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

[EVNow]

$47M restructuring were already announced in the Q10 of Q1 2019 - page 16


The in-process research and development (“IPR&D”), which we acquired from SolarCity, is accounted for as an indefinite-lived asset until the completion or abandonment of the associated research and development efforts. If the research and development efforts are successfully completed and commercial feasibility is reached, the IPR&D would be amortized over its then estimated useful life. If the research and development efforts are not completed or are abandoned, the IPR&D might be impaired. The fair value of the IPR&D was estimated using the replacement cost method under the cost approach, based on the historical acquisition costs and expenses of the technology adjusted for estimated developer’s profit, opportunity cost and obsolescence factor.In April 2019, the Company determined that it would abandon further development efforts on the IPR&D and will impair the remaining $47.0 million in the quarter ending June 30, 2019.

Missed that. Still restructuring is $70M more than this amount. There were no restructuring plans announced in Q2 (unlike in Q1).

 

[Boomer19]

Bought 100 shares at 238 after hours. This is a massive short attack on low volume. I see the stock being down tomorrow, but not like this.

Hello! 600 million in FCF? Projections of much bigger numbers going forward. Self funding! 5 Bill in the bank account and FCF going forward means bankruptcy is NEVER EVER (never say never...). In fact, with a bill per Q FCF going forward, why do you need capital raises?

I read the letter again. Good fiscal numbers and nothing unexpected. They even reduced projected CapEx. GAAP losses can kiss my ass if Tesla is generating big cash every quarter. China coming. Hold tight and believe or sell and never look back. You choose.

with you on that at 238

 

[SOULPEDL]

I've seen several people say they should have sold today and bought back tomorrow (or later). Easy to say with what we know now. But what if the -1.12 per share had been 0.00 or +0.50. That would have been beaten expectations and you would have been chasing a moving target. Sit tight and hold is the best advice if you are in it for the long term.

I agree mostly. Which is why I picked higher prices in case there was a slight pop. Back in 2017, I think I made about $45K from these smaller TSLA trades (and some LinkIn). But this same logic got me to a 100% TSLA position last month/ zero cash, so I backed off to about 85% TSLA. I definitely caught a few knives this year. Not a problem, FCF!

Hoping for some good news shortly, pump it back up a bit tomorrow.

 

[goinfraftw]

No ICE references allowed here, sir. Update your metaphors!

lol fine fine, done

 

[Stars aligned]

I've seen several people say they should have sold today and bought back tomorrow (or later). Easy to say with what we know now. But what if the -1.12 per share had been 0.00 or +0.50. That would have been beaten expectations and you would have been chasing a moving target. Sit tight and hold is the best advice if you are in it for the long term.

Sure. Otoh, that's what TA and dividing the holding in a core position and trading position is about. Indicators were a warning sign, you might also check my post in the TA thread.

 

[SOULPEDL]

with you on that at 238

OK OK OK, I hesitated but picked up 50 at $239.22 anyway. Just now.
Now let's hear something amazing on the automation front, shall we?

 

[Drumheller]

Does anyone here have a spreadsheet of analyst estimates over time? I'm looking for evidence of analysts inflating their estimates near the end of the quarter to ensure Tesla is always a "miss".

Thanks!

 

[Fact Checking]

CRS-18 scrub due to weather - Elon should be on the ER call in time.

 

[elasalle]

Sold covered calls will fund Calls tomorrow morning if price holds ...

 

[Steve m]

Demand is being destroyed and that is why they had record sales.

 

[kengchang]

Not much interesting. Energy installs are finally going up a bit.

However, Tesla admits that most remaining reservation holders have cancelled and gotten their money back (!!!!!!) That's pretty bad news, frankly.

Tesla doesn't understand that they are destroying demand with their awful service communications, and are actually bragging about underspending on service.

So, management is out of touch with the major issues the company is having. Wall Street probably won't notice though.

Customer deposits declined to $631 million in Q2. This includes an increase in our order backlog offset by a sequential reduction in customer pre-payments (i.e., customers paying more than the minimum deposit) as well as reservation cancellations as order generation has shifted nearly entirely to non-reservation holders

 

[SpaceCash]

Everything is super good bros.
I don't materially care what the price does for the next 12 months; I set a goal to accumulate a certain amount of TSLA by next July and will be very happy to be able to achieve it.

TSLA today is approximately where AMZN was at in 2015.
But it's a way more interesting company so I'm parking my money here. Shorties are doing the same stuff the always do, nothing to see here. We've seen these plays before.

 

[Todd Burch]

Note that Tesla increased 2019 guidance of Model 3 production from 7k/week to 8k/week:

"The production rate of Model 3 continued to improve gradually throughout the quarter, breaking a monthly record in May and then again in June. All manufacturing equipment in Fremont has demonstrated capability of a 7,000 Model 3 vehicles per week run rate, which we continue to work to increase. We aim to produce 10,000 total vehicles of
all models per week by the end of 2019."​

If S/X production is 2k/week then Model 3 production is 8k/week.

As suspected, after market trading is used by shorts to generate a big drop and dictate the Q2 narrative.

I think this is in-line with what they've been saying. 7k at Fremont, 1k in China, and 2k S/X.

 

[SpaceCash]

Call is live https://edge.media-server.com/mmc/p/ao8x4poq/dmediaset/audio

 

[Hock1]

Sure. Otoh, that's what TA and dividing the holding in a core position and trading position is about. Indicators were a warning sign, you might also check my post in the TA thread.

BS. "Trading shares" are nothing more than a justification for a gambling instinct. You will never, in the long run, beat buying and holding.

 

[TheTalkingMule]

If we can hold in this $240 region through August, Jan2021 $400s will look pretty damn good by Labor Day.

 

[neroden]

Earnings call:

OK, so Musk is saying a lot of totally uninteresting things so far. Babbling about how people have difficulty "feeling" an exponential. (Speak for yourself, Elon.) Zero useful information so far.

 

[SpaceCash]

Musk is in full-on hype mode, and I'm fine with it

 

[Fact Checking]

Oh, good catch!

Production seems to be going well. They just have to stop making a mess of service and they'll be golden.

There's also another bullish production guidance update:

"Depending on the timing of the Gigafactory Shanghai ramp, we continue to target production of over 500,000 vehicles globally in the 12-month period ending June 30, 2020."
​

Note the (hidden) update there: this 12 months period includes Q3, i.e. the current quarter.

To make 500k in the next 4 quarters, assuming ~100k units in this quarter and Q4 (85k+15k), if China ramps to ~3k/week by Q1'2020 that's 150k+150k units for H1'2020 to reach 500k units.

150k per quarter is 11.5k/week and 600k/year production (of all models) by mid-2020 - without Model Y production included.

 

[Drumheller]

Elon on the call:

Q3 expected to be about break-even (change from previous estimate of profitable).
Q4 expected to be profitable.