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

[traxila]

I don't think that they'll be able to breach much beyond 234. The FUDsters will want to push the stock as far down as they can, and apply heel to throat any rise. They dropped a lot of their ammo in AH, but I don't think they dropped all of it.

Allowing the stock to rise from that initial depression will just give the impression that it was the immediate reaction that caused it to drop, and the more tentative buyers will be like "maybe it wasn't so bad" and buy.

Yeah, but that's the thing. They can't short anymore now for a couple of days. Ammo can only be obtained with true long positions liquidating. I agree that this is a big deal for them, if the SP were to start rising as this report actually was exactly was it was advertised to be, then the shorts could truly find themselves in a very bad position. The short float is really very high now.

 

[dc_h]

Why leave?

—> 16 years in not simply “start up mode” stress, but “Elon Musk start up mode” stress. The last 6 years of this daily tension while knowing you, and generations to come, are ridiculously wealthy.

—> Since I’ve been following the company closely (2012), perhaps basically all of Tesla’s history (even while others were CEO) it had been very clear that JB was Elon’s “number 1,” so to speak. That is, his most trusted and valued contributor and companion on Tesla’s journey. Then Jerome was made head of automotive last year. What’s more autonomy has clearly by far become the most captivating area of development for Elon, and he seems quite taken with its driver, Andrej Karpathy. (gratuitous speculation, but I wouldn’t be surprised if Musk looks at Karpathy and thinks, “hmm... there may be someone with a more capable mind than myself... and must be nice to be so consistently “chill” yet energetically positive”).

It seems JB has basically gone from sort of Elon’s little brother, always by his side (literally brought on global trips and at his side 2013-15) and presumed heir apparent when Elon leaves CEO role for more SpaceX time (which once was a strong possibility once the Model 3 hit volume production, but not too likely for years with the CEO agreement Elon made with Tesla a year or two ago)... JB seems to have gone from that to part of the second tier orbit around Elon’s focus, barely noticed amid all the energy around day-to-day drama for which Jerome is his key player, and Tesla’s perceived FSD future, led by Karpathy.

—> Elon and JB seem to have such different personalities. Somewhat speculative, but I suspect Elon’s behavior towards people grates to some extent with JB. Given the first two points above, it’s probably become harder to ignore. The intensity of the last two years and rough treatment/letting go of large groups of employees have probably also made it harder to ignore.

I hope Elon will create a place for thought leaders like JB. Something like the Canada battery team working on long term projects. If recycling is JB's big thing, Elon or Tesla should buy a stake (if JB's interested) and help him scale up. Bell Labs in the glory days had people that worked more like DARPA research jobs then a corporate gig. Creating a safe space, away from Elon's go fast or go home world could give Tesla some long term advantages and keep some key people from going elsewhere. Best thing would be if JB was doing a Jerome (the Semi project) and is going to focus on the 1TB goal in the background, while Drew focuses on knocking out the shorter term goals.

 

[dc_h]

+1. As Rob Stark mentioned a few pages ago, Model X is fine (still light years ahead of the competition) but Model S needs a refresh (370 miles aside).

Why not X doors on the S? Who doesn't want a car that greets them?

 

[StealthP3D]

It's pretty clear that other automakers are having a really hard time matching Tesla's range and performance numbers. It wouldn't surprise me if other automakers decided to buy/license the Tesla "skateboard" and differentiate via interior and exterior design, along with the console/dash software.

It might cost traditional makers more than you think to buy or license the skateboard from Tesla.

During the earnings call, Musk mentioned that the value of their ZEV credits are highly dependent on the other manufacturer's ability to sell their own EV's. If their EV's can't gain market volume, Tesla's credits become much more valuable because they will have to buy ZEV's from Tesla whereas if they sell enough EV's themselves, they won't.

Because Tesla can likely sell all the EV's they can produce for the next several years, they would have to price into the licensing of the skateboards the ZEV credits (which would make it very difficult for those cars to compete with Tesla's which actually earn ZEV credits). This would be true even when only considering the licensing of the skateboard.

Either way, being the technological leader of a new and fast-growing industry is definitely a very valuable thing.

 

[Christine69420]

JB leaving has really shaken my confidence in this company. Also, I think Tesla made a big mistake by not updating the S. Even a mild exterior refresh would have rekindled S demand. What a waste.

JB has been skipping school for quite a while now. Only working part time really. So Drew has been the guy actually doing the managing. And obviously he's been doing a great job with all the improvements Tesla has made.

Redesigning cars every 7 years are so old fashioned. Tesla is redesigning on the run. A mild exterior refresh they can do anytime. Or adding cup holders in the doors. Or adding self presenting doors. Or different seats. Or a new front. Or different lights.

They should not rush out anything. People buying the premium cars are IMHO more conservative. So keep the two screens. The better sound proofing. The faster speeds. Don't make them stretched TM3s.

 

[ItsNotAboutTheMoney]

How exciting is the recycling business. Makes no sense from my vantage point.

Extremely exciting. Waste management is generally underappreciated, but a huge business.

 

[Cobbler]

Extremely exciting. Waste management is generally underappreciated, but a huge business.

Umicore is a nice long term investment

 

[StealthP3D]

I mean how can someone say a company with 5 billion bucks in the bank...and growing...is going to be bankrupt in a year?

Ummm...by moving their lips?

 

[X Fan]

Extremely exciting. Waste management is generally underappreciated, but a huge business.

Is waste management/recycling a "safe" business to be in (in some parts of USA the companies are "connected")?

 

[Paracelsus]

Very helpful post regarding world's energy consumption, @jhm - a sincere Thank You!

And this is only looking at the current energy use of Electricity-only......? Lots of discussions here over the years about how many other sources of energy consumption (water heating, house heating, etc) that are currently done with natural gas, propane, etc are not even considered in this evaluation I suspect. So when we look at the scale of what Elon is proposing for new battery production, I think he must also be focusing on replacing/displacing additional fossil fuel sources with electricity. Works for me, because it can and should be done.

We don't need to frack up the earth to have some hot water at our kitchen sink. How selfish is that concept - that a little hot water is more important than future generation's drinking water? Thus his concept is once again as big as it really needs to be to shift the paradigm as far as it really needs to be shifted. I invested in TSLA because of what TE can, and will do. TM is icing on the cake in my opinion.

This helps explain why Elon & JB were so giddy happy at the Shareholder meeting - they have figured out how to get there - and they are likely already moving there. Battery Investor Day could be mind-blowing for anyone not yet connecting dots to the 1 TW comment/concept.

Elon has moved the bar once again, and with a subtle comment. But he didn't move it DOWN like all the ICE CEO's. He moved it up..........about 40x higher than GF1 targets. For me this is what the most valuable take-home of yesterday's call was about............after having a night to sleep on it

 

[Right_Said_Fred]

Tried to grab 100 more @225, but was a bit too greedy. Raised to @227. I may be chasing a moving target but that's okay.

Ok, bagged the moving target @230. What does a few dollars difference make anyway if you have decided you want to buy...

(Had a nice long drive this morning in my S, a good time to think about what was said yesterday and to ponder Tesla's future. I could not come to any other conclusion than that I had to add to my position).

 

[Remus]

How exciting is the recycling business. Makes no sense from my vantage point.

Given the increasing demand for raw material and limited supply, compounded with the green imagine, very exciting.

 

[ggr]

No more shorting allowed for two days.

That's not what the Uptick Rule says. It basically prevents dumping short shares to drive the price down, "icicles" as @Papafox would call the sales. But short sales can still happen, they just have to happen at or above the current price.

 

[Steve m]

I would wait to do an X and S refresh until the next gen battery is available and the wirering harness plus software for the Y is proven.

 

[MP3Mike]

No more shorting allowed for two days.

Shorting is still allowed, they just can't drive the price down the same way. (Since they have to short at/above the current price.)

 

[Hock1]

That's not what the Uptick Rule says. It basically prevents dumping short shares to drive the price down, "icicles" as @Papafox would call the sales. But short sales can still happen, they just have to happen at or above the current price.

That is correct.

 

[jerry33]

Don't agree with that. What is the alternative? Cash basis accounting? Then Tesla would have to expense all capital improvements immediately causing far worse net loss each quarter while growing. Can you imagine expensing every dollar they are putting into the gigafactory in china right now? Billions of dollars in net loss would be the result

Obviously I didn't explain myself well. In a stable state company like Ford or GM, GAAP works very well to show the financial position. In a growth company, many items that GAAP shows as expense are more like capital outlays because their value is only realized in future periods. I don't know of any accounting system that can measure this correctly. The point is that for growth companies you have to be aware of GAAP's steady state bias.

 

[Singuy]

You are twisting around what Musk said and that's the last thing we need here.

While he did say "cash flow positive" except at new product launches, he was not including the Model 3 in Shanghai as a "new product". Because it's not a new product.

You can bet Musk will put his nose to the grindstone and apply everything learned from the initial production of the Model 3 to Shanghai. The initial launch of the Model 3 was a very slow ramp because they were too ambitious about how it was going to be built and automated. I think it's clear that the forecast Shanghai production numbers, being lower than Freemont, are not implying anything but a mirroring of how they build them in Freemont. Labor is less expensive and the workers follow instructions better and are more dedicated to company goals. I think the production ramp will more closely resemble the building of GF3 than the initial Model 3 production ramp. It's a very different thing to launch a new product, with new everything, then it is to make exactly the same product, with the same parts and tolerances, in a different location.

As to building a "fat piggy bank before Q1 2020 to weather the storm", well, that's being overly dramatic because Tesla has more cash on hand right now than any time in their history. And it's growing. And the Model 3 in Shanghai will be additive to their cash position in Q2 as they start flooding China with Model 3's.

But you are pretty good at twisting Musks comments to paint the bleakest possible picture.

It took 2.5 quarters to get model 3 out of production hell. I am already being very bullish(following what musk is expecting) to have China gigafactory to be out production hell in one quarter. I am also accounting that Y will be out of production hell in a quarter. Even with these bullish projections, Tesla will bleed q1(due to model 3 Shanghai) and q2( due to model Y). Tesla business remain the same. Workers need to be trained, massive amount of new people hired in China..even with low labor cost they are taking a paycheck before the model 3 ramp. Lots of engineers need to be paid to optimize the robotic line. Lots of money needs to be spent on materials prior to production. And if batteries/power train are not being produced at scale from giga Shanghai, then add 3 weeks of working operational cost of producing power train from Nevada and shipping it to China. It is going to suck and musk said it's going to suck. I don't know why you are trying to paint it with a rosey picture.

 

[StealthP3D]

Tried to grab 100 more @225, but was a bit too greedy. Raised to @227. I may be chasing a moving target but that's okay.

I always use market orders whenever buying or selling a stock with healthy trading volume. I learned a long time ago it wasn't worth trying to scalp a few pennies on the purchase/sale. That's not why I'm buying the stock. If using a limit buy order, you are likely to acquire the stock if it changes direction and goes down. But, if the thing is really hot (meaning you really want to own it) then you never get your shares. I do time the trade to hit a favorable point in the price fluctuations but it's always a market order for me.

 

[traxila]

That's not what the Uptick Rule says. It basically prevents dumping short shares to drive the price down, "icicles" as @Papafox would call the sales. But short sales can still happen, they just have to happen at or above the current price.

OK, gotcha thank you for the clarification, they cannot drive the price down by just smashing the bid like the did AH, but they can cap the price. Sorry to the board for the misdirection on my part