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

[Cosmacelf]

60 Megapacks hanging outside of Lathrop Factory and now there is a tent.

It just got real.

Before I was thinking ~5 / day production rate, but I doubt these have been parked for 12 days.

Maybe 10 / day now? Factory would be almost at 20 GWh of the 40GWh annualized run rate already.

Wow, that video showed trailers in pretty much every loading bay. That’s a busy factory.

 

[Ogre]

60 Megapacks hanging outside of Lathrop Factory and now there is a tent.

It just got real.

Before I was thinking ~5 / day production rate, but I doubt these have been parked for 12 days.

Maybe 10 / day now? Factory would be almost at 20 GWh of the 40GWh annualized run rate already.

“But I know a guy who paid a homeless dude to sit and watch how many trucks leave the place and only 3 left the factory before the guy demanded the bottle of rum I promised him. No chance there are 60. That’s like 6 months worth.“

 

[loquitur]

What gets me is all of the articles talk about a “Shareholder lawsuit”, but the attorneys for the class action paid large sums of money to explain to the juries how options work. That makes me doubt they were able to track down enough shareholders who sold and somehow lost significant money.



Occasional reminder: Options holders (calls or puts, short or long) are not shareholders, they are not TSLA investors, they are speculating on share price over a time period. Short “holders” are not shareholders either, nor are they TSLA investors.

Astute observation there! There is a clue from the prior SEC lawsuit (and $40M settlement) over the *exact same tweet*.
The "class period" there was defined as occurring over 2 days only, not 10 days as in this case. Usually similar cases are
consolidated together but that one was not, perhaps because it was settled early (under duress, according to Elon.)

It's interesting that this earlier SEC case settlement was not allowed to be brought up before the jury,
presumably because the erstwhile settlement admitted "no wrongdoing" so might prejudice the newer
kids in town.

So, who were the shareholders in the earlier SEC suit? This is part of my own bias, because I was one myself, having
added to my own long-held TSLA position the next day, August 8, 2018, figuring the whole dustup was a good omen.
The difference (speaking only for me, myself, and I) was that I held, even until now through a downturn.
Yup, up 8X since that tweet. Was I representative of those who bought (more) that day? Who knows, but
I figure I'll get 1-2 cents on the dollar for the SEC settlement, even though I held and never took a loss. Strange.

 

[Max Plaid]

This is not good.

I totally disagree - Sasha's video explain why:

 

[kelly]

Astute observation there! There is a clue from the prior SEC lawsuit (and $40M settlement) over the *exact same tweet*.
The "class period" there was defined as occurring over 2 days only, not 10 days as in this case. Usually similar cases are
consolidated together but that one was not, perhaps because it was settled early (under duress, according to Elon.)

It's interesting that this earlier SEC case settlement was not allowed to be brought up before the jury,
presumably because the erstwhile settlement admitted "no wrongdoing" so might prejudice the newer
kids in town.

So, who were the shareholders in the earlier SEC suit? This is part of my own bias, because I was one myself, having
added to my own long-held TSLA position the next day, August 8, 2018, figuring the whole dustup was a good omen.
The difference (speaking only for me, myself, and I) was that I held, even until now through a downturn.
Yup, up 8X since that tweet. Was I representative of those who bought (more) that day? Who knows, but
I figure I'll get 1-2 cents on the dollar for the SEC settlement, even though I held and never took a loss. Strange.

My understanding is that the SEC suit was a regulatory enforcement action by the SEC and not on behalf of actual shareholders. It wasn’t a class action suit.

 

[MikeAtkinson]

I know most people here think a TSLA share price of $1000 is low for 2030, but it's actually what my model predicts. That is assuming the following:

1. Total revenues of ~$2 trillion.
2. 17.5 million cars produced in 2030.
3. 2,700 gWh of batteries used between auto & storage.
4. 1,500 gWh of storage produced in 2030.
5. TSLA has a PE of about 18 in 2030.

Now, a lot of this is very much on the conservative side, I do that on purpose to temper my expectations as I assume things won't go as smoothly as most people expect. The super low PE is an assumption of mine based on slowed growth for Tesla by then, plus a much more hesitant market overall with respect to valuations. I concede this is probably not very realistic, and if I change that PE to 30 instead the SP in 2030 goes to $1,926 in my model, even with these conservative numbers. I also don't include anything for Robotaxi nor Optimus, this is strictly auto & FSD + solar & storage.

Honestly I'd be ecstatic with $1,000 for TSLA in 2030, but deep down I do think it will be much more than that. I'm just not counting on it.

A $1,000 price for TSLA can be discounted back to today. Assuming a conservative (high) discount rate of 12%, it would be $450 now. The current share price would be a discount rate of 25%

There is an extreme disconnect between what people on this board think the share price will be in the medium term and what the market is pricing in at present.

Edit:

$3,246

Even more disconnect with this share price forecast.

 

[petit_bateau]

It's way off-base to think there will be a 250 kWh version of the Cybertruck, especially as the launch version. It should only need 200 kWh to go well over 500 plus miles and I bet the launch version is the 300+ mile version with a battery capacity a lot closer to 155 kWH. I don't know which rumors you've been listening to but it might be a good idea to ignore those "sources" and base your estimates off what we actually know about how Tesla tends to operate.

You need to realize that some of this misinformation is created by those against Tesla to get expectations of Tesla fans so high that the actual release can only disappoint. Misinformation is weaponized to try to achieve their goals. Don't fall for it.

I've seen everything from 185kWh to 250kWh for the tri motor version with the 500-mile range. In general I find my forecast estimates over-optimistic, therefore so as to try to be a bit more conservative I used the highest of the capacity figures in general circulation (250kWh). Also I figured that Tesla would likely launch with the higher end of the specs rather than the lower end, at least that is what they have done with the Semi. The last thing Tesla want to see is lots of videos of rednecks stranded on the highway after having unrealistic range expectations towing boats and stuff. So like I say I used the 250 kWh for launch. In my modelling I am thinking how to taper that over successive years, ditto with Semi.

Detailed Modeling: Tesla Cybertruck 500-Mile Tri-Motor Battery & HP

So, how big is the Tesla Cybertruck's largest battery pack? How much horsepower will the behemoth produce? Our model provides well-researched answers.

insideevs.com

Someone at work asked me today what I think TSLA would be worth by 2030. I said that I have seen most updated targets at $1,000.
Is this the general consensus? What do you all think?

Take your pick.

Assuming the success case (but excluding full autonomy for robotics), anywhere from $400 (purple) to $2400 (red) depending on what rational approach one takes. Add in irrational factors and take your pick. Over the shorter term (~3yr) the market has tended to follow the red line (PE) but over the longer term (~10yr) it has tended to follow the puple line (NPV, i.e. discounting).

One needs to keep a sense of proportion on these things. At $2400 this corresponds to a market capitalisation of $8-trillion. The current (2022) market capitalisation of all stock markets in the world combined is about $105-trillion, and it was $93tn in 2020. Assume that global markets doubles every ten years (i.e. 7% annual growth) that means TSLA would be $8tn of $200tn i.e. 4% of world value at that point. Such concentrations of value have happened before in human history, but they are rare.

The purple line tends to get less good reception hereabouts

Ah, I see @MikeAtkinson has just made a similar point.

 

[Dave EV]

Three EV Owners Say Vehicles Were Damaged Charging At Electrify America Stations

If this was happening at Tesla chargers it would be blasted across all mass media. EA really needs to step up its maintenance of their stations.

To be fair, there has been at least a few cases that I've heard of where the Supercharger handle welded itself to the car and got stuck.

But none that I can recall, recently. I imagine it still happens on occasion.

 

[CHGolferJim]

Someone at work asked me today what I think TSLA would be worth by 2030. I said that I have seen most updated targets at $1,000.
Is this the general consensus? What do you all think?

We all hope higher, but I keep a list of projections, updating when I see changes, which has Rob Maurer and Gary Black at $1,000 in 2030 (former based on “moderate” progress with FSD) and Ron Baron $1500 by 2030-2032 (cars only at 20m in 2030).

 

[Max Plaid]

So...no one showed Farley the final product?

This might come as a shock, but in most large organisations, the CEOs don't tend to be very hands-on, and in many cases might not have much of an idea of their products and services

Occasional reminder: Options holders (calls or puts, short or long) are not shareholders, they are not TSLA investors, they are speculating on share price over a time period. Short “holders” are not shareholders either, nor are they TSLA investors.

Agree, but one can be both. One can hold long shares for years and sell very OTM calls against them, or hold core shares and trade others, etc., but it's very clear in this case that there was no case "brought by shareholders"

To be fair, there has been at least a few cases that I've heard of where the Supercharger handle welded itself to the car and got stuck.

But none that I can recall, recently. I imagine it still happens on occasion.

Really? I've been following Tesla news since 2014 and I've never heard of a Supercharger fusing to a car. Yes, sometimes the lock won't unlatch, but not the same thing, of course. I'd be interested to read about such cases if you can dig them out. Cheers

 

[Unpilot]

Thanks, but no. I know what waviness in body panels looks like - firsthand experience.

Almost TMI

 

[2daMoon]

To be clear, I'm not one of the people who is worried about the waviness, even if Tesla can't tune the production process to get rid of it by production time. That said, I think the original prototypes without the wavy appearance do have a more uniform and higher quality appearance and I think having perfectly flat panels would be a net positive for market value/demand down the road.

To see the waves as "artistic", I think Tesla would need to embrace the waves more and tune the production processes to exaggerate it. Current pre-production units have just enough wave to make it look accidental.

As for the "snowflake" aspect, I was considering the brushing as being artistically unique from truck to truck. Waves in the flat panels wasn't a part of that consideration. Though, as long as the waves are slight, they are unlikely to bother me any more than the waves on any existing vehicle's painted panels. There will be minor deviations on any piece of metal going through daily temperature cycles, won't there?

 

[ElectricIAC]

As for the "snowflake" aspect, I was considering aspects of the brushing as being artistically unique from truck to truck. Waves in the flat panels wasn't a part of that consideration. Though, as long as the waves are slight, they are unlikely to bother me any more than the waves on any existing vehicle's painted panels. There will be minor deviations on any piece of metal going through daily temperature cycles, won't there?

Model 3 makes pops and bangs while supercharging. Maybe CT will have a similar effect but external?

 

[2daMoon]

Model 3 makes pops and bangs while supercharging. Maybe CT will have a similar effect but external?

The sounds of a happy truck?

 

[Sofie]

I've seen everything from 185kWh to 250kWh for the tri motor version with the 500-mile range. In general I find my forecast estimates over-optimistic, therefore so as to try to be a bit more conservative I used the highest of the capacity figures in general circulation (250kWh). Also I figured that Tesla would likely launch with the higher end of the specs rather than the lower end, at least that is what they have done with the Semi. The last thing Tesla want to see is lots of videos of rednecks stranded on the highway after having unrealistic range expectations towing boats and stuff. So like I say I used the 250 kWh for launch. In my modelling I am thinking how to taper that over successive years, ditto with Semi.

Detailed Modeling: Tesla Cybertruck 500-Mile Tri-Motor Battery & HP

So, how big is the Tesla Cybertruck's largest battery pack? How much horsepower will the behemoth produce? Our model provides well-researched answers.

insideevs.com

Take your pick.

Assuming the success case (but excluding full autonomy for robotics), anywhere from $400 (purple) to $2400 (red) depending on what rational approach one takes. Add in irrational factors and take your pick. Over the shorter term (~3yr) the market has tended to follow the red line (PE) but over the longer term (~10yr) it has tended to follow the puple line (NPV, i.e. discounting).

One needs to keep a sense of proportion on these things. At $2400 this corresponds to a market capitalisation of $8-trillion. The current (2022) market capitalisation of all stock markets in the world combined is about $105-trillion, and it was $93tn in 2020. Assume that global markets doubles every ten years (i.e. 7% annual growth) that means TSLA would be $8tn of $200tn i.e. 4% of world value at that point. Such concentrations of value have happened before in human history, but they are rare.

The purple line tends to get less good reception hereabouts

View attachment 903520

Ah, I see @MikeAtkinson has just made a similar point.

400$? With no splits? We’re both talking 2030, right?

 

[StealthP3D]

A $1,000 price for TSLA can be discounted back to today. Assuming a conservative (high) discount rate of 12%, it would be $450 now. The current share price would be a discount rate of 25%

There is an extreme disconnect between what people on this board think the share price will be in the medium term and what the market is pricing in at present.

OK smartypants, do you care to tell us what the actual discount rate of TSLA was in the middle of 2019, assuming a price of $223.50 June 30, 2019 (split adjusted $14.90) and we assume the current price of $190 is a reasonable valuation.

Because it sounds like you are assuming the market price must be reasonable now when you judge $1000 in $2030 to be unrealistic. It sounds like you are saying that would imply an unrealistic discount rate.

The entire reason to invest in growth for the long-term is the observation that fast-growing companies are under-valued relative to their future earnings potential. Maybe I'm missing your point, but it sure does seem like you're giving the market more credit than it deserves in terms of being able to accurately value high growth companies. You are talking like a value investor that doesn't believe exceptional performance should be expected from exceptional companies.

 

[Mengy]

400$? With no splits? We’re both talking 2030, right?

Yeah, that seems incredibly unlikely to me. Given even a conservative execution of Tesla's plan up to 2030 on auto + energy alone, an SP of $400 in 2030 would require a PE well below 10, somewhere in the vicinity of 7-8 with even very conservative numbers. While possible, I do not see that happening, not with all the growth potential Tesla has along the way.

If Tesla is $400 in 2030 then many things went terribly wrong along the way.

 

[DutchDriver]

So what is the feeling for the next trading week? Should the fact that USA shoot the Chinese spy/weather balloon down, have any negative impact on the sentiment yet? Or are there other bigger events having impact? Like the record low unemployment rate in the USA?

 

[AndrewZ]

It is slightly crazy to think that a piece of Chinese surveillance technology was just shot down over our waters with a sidewinder out of a F22

 

[StealthP3D]

I've seen everything from 185kWh to 250kWh for the tri motor version with the 500-mile range. In general I find my forecast estimates over-optimistic, therefore so as to try to be a bit more conservative I used the highest of the capacity figures in general circulation (250kWh).

Forecasting the future has many potential pitfalls, therefore it makes sense to minimize the errors as much as possible. It doesn't make sense to purposefully skew estimates of things like kWh capacity of a battery pack because your estimates of other things have a bias to one side or the other. Always use the best available data for each estimated input. I'm saying we know all we need to know to be able to say anything over 200 kWh is just fantasy.

My entire point was using the highest of the capacity figures "in general circulation" is problematic because those figures are purposefully exaggerated to the upside, in order to make the actual figures, when they are announced, disappointing.

The more I see how you construct your arguments, the more distrustful I become of your perspectives. I remember in 2018-2019 this forum was full of people with similar arguments to tamp down expectations that TSLA and Tesla would or could perform exceptionally. These people always present their perspectives as being more reasonable and rational, but they don't seem that way to me. And they can prevent people from capitalizing on such exceptional performance, if and when it happens.

I could never have retired so young if I did not believe that some companies would outperform in a big way. Because it's impossible to identify those companies if you don't believe that kind of outperformance is possible over long, multi-year periods. This should be common sense.