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

[adiggs]

...
Of the $500M remaining, I'd say
- $100M for HW3 upgrade (COGS) per vehicle
- $150M for traffic lights/signs
- $250M for City NOA

Out of this may be 75% is in the US. So, depending on what gets released in Q4/Q1, where it gets released, how much of HW3 upgrade has been done in Q4/Q1, we can get some sense of how much revenue recognition we should expect. Given seasonally low Q1 and developing timeline for FSD FC, it would make sense for Tesla to complete HW3 upgrades in Q1, release FSD FC - recognize $400M in deferred revenue. This could also make sure TSLA gets added to S&P 500 after Q1.

We should watch FSD FC closely - if it is released close to end of Q1, it would be a good sign.

A point I like to make now and then - of this deferred revenue, when Tesla recognizes ~$170M worth of it, that translates into a $1 EPS change that quarter. Very small numbers (relative to what the company is starting to push around) move the EPS of the company by a lot.

 

[Tslynk67]

FCA and Peugeot have reached a "deal", apparently.

 

[TradingInvest]

A company built a 6 MW solar power plant on my land. I recently went there to take a look, the scale is impressive. If they want, I will let them build another 50 MW. This is definitely better than burning coal and natural gas, both environmentally and economically.

For years we talked about EV is the future, we finally get to the tipping point. The future is solar+energy storage+EV. In the next few years Tesla car's all-in cost will reduce at least 30%, quality/features will continue to improve, margin will improve a lot because of software package. I consider myself fortunate that many Wall Street analysts don't understand what's happening.

Edit: Elon and Robyn both said they believe Tesla's EVs are appreciating assets. What does that mean? To me, that means they will be able to raise price in the future. When sales increase several fold, cost goes down by 30% per vehicle, retail price goes up, it will translate to high gross margin.

 

[Artful Dodger]

OK, this is going to come off as abrasive. It is meant that way. See if I care .

One of the reasons Wall Street and the shorts have so much control over TSLA is because there are so many fraidy-cat bulls.

Jeez guys. The stock literally just went up $60+ bucks in a week, and everyone is crying and in fear. We have the shorts by the balls now. Tesla's future is bright.

Hold on to those balls and squeeze 'em. The last thing you want to do when you have your nemesis by the balls is to let go of them by selling.

Hold. Buy. Squeeze those shorty testes. If you're not confident in Tesla's future, then stop calling yourself a bull...you're just a swing trader.

Yeah, that doesn't work in this universe when market makers can conjure up an infinite number of shares to sell short. They have a de facto exemption to the law of supply and demand when it comes to price discovery for an individual equity.

Your rant is touching, but naive to reality. See @Hock1 's comment earlier today about:

1. the Madoff (shortseller's) exemption
   
2. uptick rule change

IT DOES NOT MATTER if every single long holder never sells a share: market makers create phantom shares under the guise of "providing liquidity". In fact, they usurp the Company's sovereign right to be the sole issuer of equity for that company. And the SEC is fine with that.

So the game is rigged. We know that, but hold shares anyway to support the company. Now that Tesla is self-funding, market makers and their sugar-daddy/oil-baby's can't hold back Tesla's success.

That's what matters, not whether some 'swingers' gain or lose a few bux. It's about the future of our culture on this planet, and if we'll preserve a livable environment for our children. That's the battle

That's why we fight.

 

[woodisgood]

I consider myself fortunate that many Wall Street analysts don't understand what's happening.

Do you believe you would be less fortunate if the majority of analysts covering the company were not auto/transportation analysts but rather tech/software/energy analysts?

 

[Fact Checking]

FCA and Peugeot have reached a "deal", apparently.

Nice: the addressable market for Tesla's "ZEV pool" would increase significantly, as neither FCA nor Peugeot are anywhere close to reaching the 90g/km target of European CO2 emissions.

 

[Nocturnal]

Does being added to the S&P500 give the stock some protection from MM/short-selling, given the greater amount of funds that will buy? Or other advantages? I've never followed a stock during its inclusion into said index.

My understanding is that it would add a large amount of stability just due to the numerous index funds that will have to include the stock as part of the fund.

 

[imherkimer]

If Elon likes something about the sci-fi drama in question, he may well try to make it happen.

I am still waiting on that amphibious car Elon bought years ago from the estate of Bond, James Bond.
Elon said he was disappointed to learn it wasn’t really amphibious, acquired it, and said he would make it truly amphibious. Seems all forgotten now. It was just a lark of a billionaire, i suppose, ha ha.

But even if it appeared just as a limited “halo” production, imagine the market “shock“ if Tesla suddenly offered an amphibious “truck” that could also achieve a record at the Nurburgring, AND go off-road on seriously rough terrain, while hauling a load of tools and materials, arriving ready for the job at hand, autonomously.

Sure, that’s likely a ridiculous exaggeration, but one way or another, I have a feeling surprises will arise!
Again and again! I just don’t see it stopping anytime soon. Elon’s companies keep getting better and smarter. And they are getting damn good at not showing their hand.

I can’t sell any TSLA, because it’s gonna boom sometime..... timing is impossible, and enmity is very strong, so can’t trust options. Just keep holding long and strong, adding if I can, and watching the battle unfold. I think shorts are playing with big fires. Last week was just a little taste of what is to come. Shorts continue to come back so get ready to be squeezed again. In the long run it’s going to compound badly with frozen assets for fossil fuels, and collapsing markets for ice vehicles. Can’ see a big epic squeeze, but a series of “surprises” moving sp 20 - 30% and squeezing shorts again and again, because the market “didn’t see this coming.”

Ok, I suppose Bond was not really sci-fi.... so maybe I got this all wrong. I did see a video once of Model S driving, well, “sailing“ through a flooded tunnel, so it’s already semi-amphibious right?

Wait.... semi? Amphibious semi?

 

[woodisgood]

My understanding is that it would add a large amount of stability just due to the numerous index funds that will have to include the stock as part of the fund.

Right, you're essentially adding a lot of deep-pocketed longs and reducing the amount of shares available to short?

 

[TradingInvest]

Well, Buffett is primarily targeting monopolies and other rent seeking industries - or companies that can trivially be turned into rent seekers.

Fast growing companies are often at danger of not becoming a monopolist, plus buying in the growth phase means he'd pretty much always have to pay a growth premium, with the risk of buying a bubble.

Buffett prefers to always buy guaranteed, multi decade cash flows at discounted prices. Any growth premium is pretty much a deal breaker.

Note that even when Buffett invested in AAPL in early 2016, Apple was showing signs of revenue reduction and the share price corrected, with little growth premium left.

I'd have expected Buffett to invest into Tesla in Q1 or Q2 - I'm sure Berkshire Hathaway considered it seriously, and he was a fool for not doing it. I'd guess he didn't do it due to cultural bias - Elon is likely to weird for Buffett. Also because Tesla has perhaps the most complex integrated business plan in existence of all major firms, and Buffett prefers simple monopolies.

His loss.

As long as Buffett and Munger are in place, Berkshire will not invest in Tesla. I wouldn't be surprised that in future years, when Ted Weschler and Todd Combs take full control of Berkshire investment, they will start to invest in Tesla at around $3000 a share.

It's funny that Buffett in two years in a row said he made a mistake for not investing in Apple earlier (Steve Jobs even approached him many years ago. He missed it miserably). Then in the third year he said "I never said I made a mistake not investing in Apple". Then soon they disclosed they started investing in AAPL. To be fair, it could be Ted or Todd started buying AAPL.

 

[Krugerrand]

Ok, now I'm excited. And I want it.

Model Y Prototype Spotted (2019-10-25) : teslamotors

EDIT: Not sure if there's a perspective issue with the dash cam, but this looks a lot larger than I had previously thought, not just a 3 with a hatch. This makes me feel better about the differentiation.

If I recall, 66 cubic feet of cargo space. Barely bigger than a bread box.

 

[TradingInvest]

Do you believe you would be less fortunate if the majority of analysts covering the company were not auto/transportation analysts but rather tech/software/energy analysts?

Even if tech analysts are covering it, they won't get it either. People on this forum are far more intelligent than those analysts.

Very few analysts are operating in a way to look for long term investments. Some are trying to predict the stock swings, some are trying to mislead people.

 

[Doggydogworld]

Could it be the new Lathrop warehouse:

Tesla's rumored Lathrop distribution center seems poised to start operations soon
​

At almost 1 million square feet it's pretty large. This might be part of the Model Y plans where they freed up warehouse space at Fremont.

It's leased. Tesla puts leased assets on the balance sheet in some cases, but I don't think Lathrop applies. Also, Lathrop would go into service in a single quarter, not be spread over two.

 

[thait84]

I wish there were more days in the week so my weeklies have a chance of being ITM again. haha

 

[Skryll]

Well, if he treats TSLA like other highly successful tech companies, he'll start buying at about $2000/share.

2023?

 

[dgodfrey]

In fact it's the opposite of a recall. Hey, we'd like you to bring your car in so we can replace a non-defective part that will significantly improve it's performance and resale value at absolutely no charge to you (except for your time).

Has that EVER happened before? What do we call it? An glee call?

I believe the only way to get the upgraded computer is if you purchased FSD. They would be fulfilling their obligation.

 

[TradingInvest]

I don't think Tesla is a risk free investment. There are still risks. There are still chances for rough periods.

I suspect for a long time Elon was worried about hostile take over. Imagine if Saudi fund or VW start to buy shares on the open market, and turn into large shareholders. Elon would not like that situation. He could be voted out.

He said at some point Tesla will be so large that nobody will have the resource to take large chunk of Tesla. I think he is thinking about Tesla's market cap reaching half trillion and beyond. I do think the next few years will be the transition period. Those funds that missed the opportunity to build a sizable investment won't be able to do it later. People on this forum is the first group that can see what's coming.

 

[wipster]

I believe the only way to get the upgraded computer is if you purchased FSD. They would be fulfilling their obligation.

Regardless...

 

[KSilver2000]

Not advice or anything in any way, but my portfolio makes it appear the market bets for the Fed to not cut rates as desired.

As I suspected.

 

[SteveG3]

Model 3 becomes the first electric car approved for New York City taxis. Each driver can save a few thousand dollars per year on gasoline. It will reduce street air pollution too. Beijing announced they will switch 20,000 taxis to EV before the end of next year.
Model 3 is the best choice for taxi companies. A lot of people will have a chance to ride the EV.

Passenger: So how do you like the car?

99.6% of Cabbies: It's a pleasure to drive