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

[FreqFlyer]

Greenlight Capital is not having a good quarter. So this guy doesn't like Tesla, ok but he likes GM? Of all the other automakers have upside, he thinks GM?

Tesla Stock Gains Dim Einhorn’s Greenlight - Market Realist

"Tesla (TSLA) stock’s rise has brought trouble for many short sellers, including David Einhorn’s Greenlight Capital (GLRE). Tesla stock has risen 23% since the company’s earnings release in October. Short sellers lost more than $1 billion in one day as Tesla stock rose."

 

[SoGA Fan Club]

There are now 72 superchargers under construction in the U.S. alone. I know some of these are still waiting for stalls, but this is still by far the greatest number of superchargers under construction at one time. In fact, 5 started construction (or were found to be under construction) in the last 2 days, and 9 in the last 5 days. I can remember from 6.5 years ago to about a year ago, I'd wake up every morning, go to supercharge.info, get super excited if even one new supercharger under construction was reported, and then proceed to check the status of EVERY single supercharger being built (by clicking "Discuss" on the pop-up for each supercharger cone and being redirected to the supercharger's thread here at TMC). I could literally tell you what phase of construction every supercharger was at at any time. Typically, there would be 9 to 15 under construction simultaneously.

I haven't been able to do that in a LONG time. Tesla simply ran all over me!! And I love it. I can't help believe that Tesla is taking its time with the Y for several reasons - the first being to make sure it gets the car perfected as much as possible before production begins, next is to allow battery production to continue to ramp to a point they can build enough packs to supply the onslaught of demand the Y will see, and finally, to open enough superchargers to support double or triple the number of Tesla vehicles on the road today in a very short time.

Exciting times folks.

 

[EVNow]

Ok, I take that back, I now agree with @EVNow that there's measurable shorting via the options market - here's the total open interest volume of the last 24 hours, for today's options expiry (2019 November 1):

expiry: November 1
Options Open Interest

PUTs CALLs
2019/Oct/31: 114,695 88,944
2019/Nov/01: 122,729 92,154
delta: +8,034 +3,210

So in the past 24 hours there were 2.5x more puts purchased than calls.

The imbalance between puts and calls is now ~30k contracts, or 3 million shares-equivalent.

I'm particularly interested in intraday trading. I'll investigate what happened on Monday when SP ran to 340 and then fell. We won't know about causation - but I think we'll see quite a bit of correlation in minute-by-minute volumes of options & stock.

ps : For eg. just now as the SP is raising or falling - in the 315 call options market 100 contracts are being sold/bought per minute. That is equivalent to 10,000 shares - in one strike. Just a few such strikes can drive the entire volume we see today - the highest volume has been 70k.

 

[Pras]

Greenlight Capital is not having a good quarter. So this guy doesn't like Tesla, ok but he likes GM? Of all the other automakers have upside, he thinks GM?

Tesla Stock Gains Dim Einhorn’s Greenlight - Market Realist

"Tesla (TSLA) stock’s rise has brought trouble for many short sellers, including David Einhorn’s Greenlight Capital (GLRE). Tesla stock has risen 23% since the company’s earnings release in October. Short sellers lost more than $1 billion in one day as Tesla stock rose."

This is foolish of Einhorn to have shorted Tesla but even worse was to not book some profit when he had a chance.

 

[Huskyf]

Strange all others cars manufacturers are in deep green and TSLA are in RED

 

[copyhacker]

We are past this point, read the automobile trade mags, and all of the boardrooms are griping how to do EV and do it profitably. It take 3-4 years to design a car and bring it to production. The market will see them in a year or two

If this were true, we would have seen at least one of the following:

• Electronics or auto manufacturers breaking ground on (not announcing plans for) Gigafactory clones
• GM resurrecting the Saturn marque to sell only EVs, direct to consumer
• EV ads airing in volume across the country without shots of leaves or other eco-signals
• New EV models announced without the silly electric blue badging or names like "I.D. Crozz" and "i-MiEV"
• Charging stations in construction that do not require multiple cables, adapters, or NFC cards to operate
• No one using the weasel word "electrified" to talk about their upcoming models
• The Taycan would have beaten the Panamera around the Nürburgring

That last one is telling. Porsche, a brand built on engineering excellence, blinked at the moment of truth. They couldn't bring themselves to Osborne their own ICE car. I think we're going to look back at the 'ring as the end of the beginning of the end of ICE.

Business history is full of sleeping giants that were slain, not so full of sleeping giants that woke up and fought off the upstarts. Typically, by the time the incumbent recognizes the risk, it's already too late. The only exceptions coming to mind are cases where the incumbent had a natural monopoly (Windows for example).

Can anyone name a company that actually remains competitive in the field where they were disrupted? I don't know that Microsoft really counts: you could make the case that they were disrupted in the personal computing arena by the smartphone. They're mostly still around because Office has a stranglehold on the corporate environment and they leveraged their hardware expertise to build the Xbox.

 

[StealthP3D]

I cannot see Tim and Elon working together for more than about ten minutes before the blood starts to flow.

The whole idea of Tesla hooking up with AAPL is more ludicrous than Ludicrous Mode! Speculating that this might happen just makes proponents of that look like they have no idea about what's going on.

Elon Musk is in a whole different realm vs. Tim Cook.

 

[jerry33]

Can anyone name a company that actually remains competitive in the field where they were disrupted? I don't know that Microsoft really counts: you could make the case that they were disrupted in the personal computing arena by the smartphone. They're mostly still around because Office has a stranglehold on the corporate environment and they leveraged their hardware expertise to build the Xbox.

I can name one, "Goodyear". However, like your Microsoft example, they survived mainly due to their other products (plus Defense Industry contracts) and recaptured a competitive environment. These are very much the exceptions though.

 

[FreqFlyer]

The whole idea of Tesla hooking up with AAPL is more ludicrous than Ludicrous Mode! Speculating that this might happen just makes proponents of that look like they have no idea about what's going on.

Elon Musk is in a whole different realm vs. Tim Cook.

I agree but for different reasons. Mr Cook is interested in profit first. Apple makes roughly 20 cents profit off over every dollar, which is the reason ( thank you Iphone) that it has over $210 Billion dollars in CASH sitting in accounts around the world. In Apple's math, Tesla does not add to this equation. Apple big push right now is services, hence the big Netflix like streaming service Apple just started.

Beside Elon is not wired that way,

 

[Nocturnal]

Can anyone name a company that actually remains competitive in the field where they were disrupted? I don't know that Microsoft really counts: you could make the case that they were disrupted in the personal computing arena by the smartphone. They're mostly still around because Office has a stranglehold on the corporate environment and they leveraged their hardware expertise to build the Xbox.

There must be some exceptions but I can't really think of any.

 

[StealthP3D]

Mansion that will never run out of power with two Tesla Powerwalls goes on the market for $9 million | Daily Mail Online

Most mansions wouldn't even go a day with only 2 Powerwalls!

 

[Tslynk67]

Insideevs Tesla October US sales should be released tomorrow morning. It should give TSLA a boost given all the recent kooky talk about declining US sales.

Don't be so sure about that - likely that most of the production has been sent overseas...

 

[elasalle]

Insideevs Tesla October US sales should be released tomorrow morning. It should give TSLA a boost given all the recent kooky talk about declining US sales.

Didn't InsideEV say they will no longer be providing monthly numbers?

 

[ReflexFunds]

I think this is extremely unlikely. First, Tesla is very likely to be supply constrained here. Tesla is talking about growing to sell 20M units globally. Any expansion in capacity is going to be towards Tesla products.

Second, Elon and Tesla (similar to Apple) just doesn't seem like the kind of company to share their tech. Yes opensource and patents, but not make actual products for competitors. They're going to leverage all their vertical integration and proprietary tech to increase their sales as much as possible rather than help competitors. Like with Apple and Steve Jobs, Tesla and Elon are not going to allow "clones", like in the PC Wintel and Android world. If you want any of that Tesla goodness, you're gonna have to buy a Tesla. I think he was even asked this question on a CC, and Elon just seemed to shrug it off. Their EV powertrain is a significant part of their competitive advantage and I don't think they would sell that to competitors.

What Elon wants to see is other OEMs doing what he is doing. Building GFs and committing to battery and EV powertrain R&D and manufacturing. He doesn't want them coming to him for supply.

I don't really get the objections to Tesla selling Powertrains, particularly if you support the Tesla Energy division.

Tesla could easily make as high gross profit per KWh selling Powertrains + Batteries to FCA as it makes on selling Megapacks.
Tesla quite clearly has huge scale battery plans to ensure batteries do not prevent Tesla ramping up its solution to global warming in the future.

Imagine if Tesla stripped out all of its other tech leads from its cars - 1) Autonomous features. 2) Safety 3) Durability, 4) Entertainment & OS, 5) Non EV Powertrain car innovation, 6) Agile development for continuous product improvement.

This would leave a Tesla car with equivalent specs to the FCA car built on the Tesla platform. But Tesla's car would still be significantly cheaper at the same time as making significantly higher gross profit due to 1) No EV Powertrain gross profit cost. 2) More vertical integration in the rest of the manufacturing process and 3) Online sales model, no marketing and vertical integration of the dealership network.

 

[KarenRei]

Don't be so sure about that - likely that most of the production has been sent overseas...

Feel free to point any such kooks pushing that line of argument here

Nafnlaus on Twitter

 

[KarenRei]

Didn't InsideEV say they will no longer be providing monthly numbers?

If I remember right, they said they'll try, but they'll be much less trustworthy.

 

[Christine69420]

Most mansions wouldn't even go a day with only 2 Powerwalls!

I agree - but it's nice to see Tesla Powerwall beeing the most important quality of this mansion. Who needs advertising?

 

[jerry33]

I don't really get the objections to Tesla selling Powertrains, particularly if you support the Tesla Energy division.

Tesla could easily make as high gross profit per KWh selling Powertrains + Batteries to FCA as it makes on selling Megapacks.
Tesla quite clearly has huge scale battery plans to ensure batteries do not prevent Tesla ramping up its solution to global warming in the future.

The only real objection is that their previous attempts didn't last long (Mercedes and Toyota). True, it's a different world now.

 

[ReflexFunds]

I agree but for different reasons. Mr Cook is interested in profit first. Apple makes roughly 20 cents profit off over every dollar, which is the reason ( thank you Iphone) that it has over $210 Billion dollars in CASH sitting in accounts around the world. In Apple's math, Tesla does not add to this equation. Apple big push right now is services, hence the big Netflix like streaming service Apple just started.

Beside Elon is not wired that way,

I personally think at this stage it is looking more likely than not that Tesla can self fund itself to a profit higher than Apple's within 5 years time. And i don't expect Apple's profit to collapse. In fact i think it's feasible that each of Tesla's key divisions individually has higher profit than Apple - 1) Robotaxis, 2) Auto, 3) Energy.

 

[StealthP3D]

Ok, I take that back, I now agree with @EVNow that there's measurable shorting via the options market - here's the total open interest volume of the last 24 hours, for today's options expiry (2019 November 1):

That's going to hurt.

The good thing is those puts will just gently time-decay down to zero. So it won't be like getting stabbed in the back, more like the kind of slow, painful death that happens if struck by a hit/run driver on a rural road and just left to die slowly in the ditch.