Tesla, TSLA & the Investment World: the Perpetual Investors' Roundtable

[StarFoxisDown!]

Not passing $300 again until 2025 with a PE of 25.



I admit my model is very conservative, but I model our PE continuing to compress from here on out. My theory is Wall Street doesn't let TSLA back up off the floor again and keeps the PE low, so our SP stays down until fundamentals force it to break out simply due to financial math.

Price of $417 in 2026 with a PE of 23. EPS of $18.05, revenues of $481B, net income of $70.9B.

Now, I do think the PE will have periods of breaking out during rallys, so it wouldn't stay compressed all the time. BUT, my model is tuned with the expectation the MM's keep working TSLA back down at every chance they get to keep the PE compressed and on a downward trend over time.

I do hope reality is FAR more positive for TSLA investors. I just model the conservative case to keep my expectations low.

Good luck Starfox!

I actually agree with you on where the PE will ultimately be around 2 years from now......25-30. The PE range based on macro environment could easily warrant a 30-40 PE if interest rates drop by 2024.

Where I disagree is your actual earning estimates. EPS of $18.05 for 2026 means quarterly EPS of $4.5. I think Tesla will average that number in 2024. I'm not sure how or if you're factoring in IRA benefits to Tesla's earnings but that alone could be 3-5 billion in net income per year.......Starting in just 2 weeks.

 

[UncaNed]

Elon Musk is Tesla's brand and 'needs to pull it together,' says Loup's Gene Munster

I wasn't aware Gene Munster produced a comparable range of competitive products with Elon's on the same scale, and thus was qualified to give Elon advice.

 

[Buckminster]

Some diversions to calm the nerves:

Nothing much discussed on this subject since Lodger's post yesterday:
S&P500 rebalancing and non-index buying/selling
Seems likely that this is the droid you are looking for. Will Friday's closing cross be the end or the start of the melt up? (haha both options are fairly optimistic as usual from me).

Holiday update thread - Apple Music, Steam and even Mahong! + Tesla gaming

FSD beta V11 (now with some employees)

H/W 4.0 coming mid Jan? - new cameras, radar etc.

IRA inbound in 2.5 weeks plus China incentives announced

Tom Zhu - who?

"Quasi-infinite economy". aka bot

X.com - the future of social media

Tesla Semi - pretty sure there is more to discuss than cold weather regen down a mountain...

Buyback - will they / won't they?

Climate change - what are we here for?

FUD - stop talking and take action

Gigafactories - Berlin moving to new shifts, Shanghai build - next one in Macron's (Elon's new mate) turf?

Robotaxis - you need to know how rich you are going to get don't yer?

4680s - someone said it is all about the batteries stupid

This thread was started in 2018... Elon Musk, please STFU

 

[EVMeister]

Elon Musk is Tesla's brand and 'needs to pull it together,' says Loup's Gene Munster

You get a disagree from me here not for the Gene Munster stuff, but because you posted a video dominated by GoJo and I wasted my time listening to it. Now I'm annoyed.

 

[thx1139]

Swore never to bet against Elon back in 2014. The only thing that could discourage me is if he was romantically involved with a white pigeon.

Sounds like a prediction

 

[thx1139]

Go back a couple years. What are the changes Elon would either barely or not at all say anything about a potential break through in clean energy like the Nuclear Fusion news from yesterday?

 

[verystandard]

Last one:

https://twitter.com/x/status/1603115172293316608

Leo is the man

https://twitter.com/x/status/1603127619628584960

 

[jabloomf1230]

Go back a couple years. What are the changes Elon would either barely or not at all say anything about a potential break through in clean energy like the Nuclear Fusion news from yesterday?

One observer's comment was that because of the results of this experiment, commercial fusion is only four decades away instead of five.

 

[Christine69420]

Thanks. And you're probably right about my skin. It’s a cultural thing I guess. Following EM and TSLA is just not that fun anymore.

Oh man! You have some costly friends! But best of luck with your new adventures.

 

[ElectricIAC]

Oh man! You have some costly friends! But best of luck with your new adventures.

Some people are just allergic to money.

More for the rest of us.

 

[elasalle]

I wasn't aware Gene Munster produced a comparable range of competitive products with Elon's on the same scale, and thus was qualified to give Elon advice.

good advice can come from anywhere.

I am a nobody, but my advice to Elon would be "STFU" only science or memes please.

 

[SebastienBonny]

Not passing $300 again until 2025 with a PE of 25.



I admit my model is very conservative, but I model our PE continuing to compress from here on out. My theory is Wall Street doesn't let TSLA back up off the floor again and keeps the PE low, so our SP stays down until fundamentals force it to break out simply due to financial math.

Price of $417 in 2026 with a PE of 23. EPS of $18.05, revenues of $481B, net income of $70.9B.

Now, I do think the PE will have periods of breaking out during rallys, so it wouldn't stay compressed all the time. BUT, my model is tuned with the expectation the MM's keep working TSLA back down at every chance they get to keep the PE compressed and on a downward trend over time.

I do hope reality is FAR more positive for TSLA investors. I just model the conservative case to keep my expectations low.

Good luck Starfox!

Well your EPS for 26 is not too bad actually. It’ll depend at what PE Tesla will be trading at that time.

 

[traxila]

Go back a couple years. What are the changes Elon would either barely or not at all say anything about a potential break through in clean energy like the Nuclear Fusion news from yesterday?

Very high.

The breakthrough is great, but not currently applicable. There is a high chance that EM would not have said much about it. Why cast shade on what we can do immediately by highlighting a theoretical future energy nirvana?

Waiting 20 years for fusion is a familiar task, and ultimately useless.

We could and should be 100% renewable in 20 years with our current technologies. Fusion can arrive then if it wants to and be used to sequester the carbon. Better late than never.

 

[Mengy]

I actually agree with you on where the PE will ultimately be around 2 years from now......25-30. The PE range based on macro environment could easily warrant a 30-40 PE if interest rates drop by 2024.

Where I disagree is your actual earning estimates. EPS of $18.05 for 2026 means quarterly EPS of $4.5. I think Tesla will average that number in 2024. I'm not sure how or if you're factoring in IRA benefits to Tesla's earnings but that alone could be 3-5 billion in net income per year.......Starting in just 2 weeks.

I don't include any of the IRA direct benefits to Tesla in my model yet. I'm waiting until we get a few quarters of info to see how it pans out so I can better estimate it down the road.

Again, it's just one more way my model is a conservative expectation. I don't include anything at all for Robotaxi's nor Optimus either, even though I know there WILL be revenues from both eventually.

 

[thx1139]

Very high.

The breakthrough is great, but not currently applicable. There is a high chance that EM would not have said much about it. Why cast shade on what we can do immediately by highlighting a theoretical future energy nirvana?

Waiting 20 years for fusion is a familiar task, and ultimately useless.

We could and should be 100% renewable in 20 years with our current technologies. Fusion can arrive then if it wants to and be used to sequester the carbon. Better late than never.

He mentions Nuclear should be ramped and building a new reactor takes 10+ years. Newest in France and Georgia have been under construction for 15 years. I believe Elon of old would have at least congratulated the scientists.

 

[TSLA Siempre]

No, both of these things would be apparent in the customer deposits.

If the longer term demand was significantly weakening, customer deposits should be way down since Q4’s production was much higher than Q3. If there’s no new customer deposits coming in, the deposit amount should shrink rapidly on Q4 earnings. In fact, if customer deposits stays steady from Q3 to Q4 earnings, it means the net amount of orders coming in is higher than in Q3.

Again, if you think there’s significant demand destruction happening right now, then there would cancellations from current owners and lack of new orders from new potential customers

Appreciate the analysis, but I don't think that is quite right. The number of $ in deposits reported is a snap-shot in time. The difference in this quarter's deposits versus last quarters deposits gives a sense of what happened in the intervening months. If the deposit $ stayed the same between q4 and q3, it means they fulfilled more orders than in the last quarter (assuming deliveries were higher and accounting for changes in inventory).

What would be helpful to know regarding demand is order flow (i.e orders per unit of time like orders/day), especially for the US market. Tesla has that, but we likely wont get that from Tesla.

Yes, the order flow integrated over time (especially at the end of the quarter) impacts what the deposit $ reported in the quarterly filing, but they aren't the same.

Deposits need to grow at least commensurate with production capacity growth. Just as inventory should be expected to grow at the end of the quarter. They are making more cars, so everything should scale proportionately all else being the same.

Also, this issue might not make a difference in the near term, especially with the IRA, but could become more salient as volume increases. Also, demand changes can also manifest in other ways (ie. price changes and other demand levers). This will be confounded by the IRA, so the picture likely wont be clear unless demand is super strong or super bad.

 

[tslalala]

Very high.

The breakthrough is great, but not currently applicable. There is a high chance that EM would not have said much about it. Why cast shade on what we can do immediately by highlighting a theoretical future energy nirvana?

Waiting 20 years for fusion is a familiar task, and ultimately useless.

We could and should be 100% renewable in 20 years with our current technologies. Fusion can arrive then if it wants to and be used to sequester the carbon. Better late than never.

The fusion news is encouraging, but not a game changer. If I remember correctly, the fusion reaction required a certain amount of input energy and the output was only 20% more than the input energy. This is a good step forward, but hardly a game changer ready for prime time. It's going to take decades more before efficiencies improve and just hopefully, it might be safely reproduced in commercial settings.

Think of the millions of "game changing" battery news articles about "breakthrough" battery technology/chemistry. How many of those have made it to viable, profitable, commercial deployments? It's almost like mainstream news consistently embellishes the truth in one direction or the other (just not accurately/realistically).

 

[traxila]

He mentions Nuclear should be ramped and building a new reactor takes 10+ years. Newest in France and Georgia have been under construction for 15 years. I believe Elon of old would have at least congratulated the scientists.

Nuclear fission is available right now.

I do not agree with Elon on the new nuclear, but I assume he envisions a fast track that would actually get one built in five years time. They do have much better designs now....

He may still congratulate the scientists at some point, I dunno. He seems kind of busy.

 

[Todd Burch]

Leo is the man

https://twitter.com/x/status/1603127619628584960

That's probably the spike we saw in the afternoon, which then was pushed backed down by the you-know whos.

 

[Max Plaid]

6% down Monday, 4% yesterday, 2% today, so tomorrow we're good, right?

I listened to JHole's speech, plus the Q&A, and found it quite relaxed and optimistic, lots of talk about the strong job market and how unlikely it would collapse, just 75bps rise on the table next year which could be slower 25bps, seemed clear that the latest CPI numbers were not taken into account either, so adds more weight to slowing down in 2023

So mildly surprised by the late sell-off across the markets, the only comfort I take is that TSLA was relatively strong today, hopefully the markets reflect overnight reverse tomorrow