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

[Artful Dodger]

BTW, with this whole debate regarding the secondary offering. Why now?

Lol, Big Boys got theirs for $767. Underwriter's Money Train jus' keeps on chuggin' along...

 

[pz1975]

Smells like a $800 pin today.

 

[elasalle]

TSLA SEC Filing Details: Form 424B5
Filing Date: Feb 14, 2020

"Form of prospectus disclosing information, facts, events covered in both forms"

0001193125-20-036491 | 424B5 | Tesla, Inc.

View attachment 511072

So the war of words b/w TSLA and MM is kinda over. More credit to new CFO I guess ..
(a cozy relationship will not hurt)

Next up some credit rating improvements ...

 

[Cirrus MS100D]

Anybody have any insight on what the "latest" information request is about? I presume 'Qers have been throwing countless FUD at the wall and something "new" stuck? I've lost track of the conspiracy theories at this point.

In particular, the SEC had issued subpoenas to Tesla in connection with (a) Elon Musk’s prior statement that he was considering taking Tesla private and (b) certain projections that we made for Model 3 production rates during 2017 and other public statements relating to Model 3 production. The take-private investigation was resolved and closed with the settlement with the SEC described above. On December 4, 2019, the SEC (i) closed the investigation into the projections and other public statements regarding Model 3 production rates and (ii) issued a subpoena seeking information concerning certain financial data and contracts including Tesla’s regular financing arrangements. Separately, the DOJ had also asked us to voluntarily provide it with information about the above matters related to taking Tesla private and Model 3 production rates.
(From page 120 Q4 2019 10-K)

 

[Fact Checking]

Coincidentally that’s the exact price I paid for my shares when I bought them yesterday. I bought them about 30 minutes after the open, so I wasn’t quick on the draw or anything. My point being that you’ll see headlines today saying the offering price is at a 5% or so discount to shares today. That’s meaningless and just an attempt to make Tesla look bad as if they had to discount their shares. There was no discount. That price (and even lower) was available to any retail investor yesterday after the share offering announcement.

$767 was the TSLA closing price two days ago, and the basis if the prospectus.

In the final offer they simply didn't change that price, so the equity round was closed immediately.

 

[TheTalkingMule]

Coincidentally that’s the exact price I paid for my shares when I bought them yesterday. I bought them about 30 minutes after the open, so I wasn’t quick on the draw or anything. My point being that you’ll see headlines today saying the offering price is at a 5% or so discount to shares today. That’s meaningless and just an attempt to make Tesla look bad as if they had to discount their shares. There was no discount. That price (and even lower) was available to any retail investor yesterday after the share offering announcement.

Right on cue.....Bloomberg teasing coverage of Musk changing direction and selling shares at a discount.

 

[Artful Dodger]

More on topic: lots of talk about a Texas Gigafactory and while Texas was in the running against Nevada for Giga 1, I’d think a more centralized eastern location would better serve logistically. As well several eastern states are economical and have plenty of workforce.

Elon did tweet something about a "Tri-State Area" as a prospective location for a new Giga, but that wasn't in conjunction with the CT project specifically. So there may well be a new Gigafactory at some point east of the Mississippi, but it could be several years before an announcement. Product selection for a new Giga is also an issue.

In the mean time, IIRC, about 1/3rd of all Pickups sold in the U.S. go into TX/OK. A TX Gigafactory would be ideally located to serve this huge local market.

Texas also has this other super secret source of bty cell raw materials from natural gas production (note that SpaceX Raptor rocket engines will be fueled by methane):

New lithium extraction method could reuse fracking wastewater | Mining-Technology.com

Shale boom could fuel batteries | Earthmagazine.org

Cheers!

 

[KarenRei]

Right on cue.....Bloomberg teasing coverage of Musk changing direction and selling shares at a discount.

It wasn't a "discount" when this was announced yesterday... :Þ

 

[Chocochip]

Another good video by Rob Maurer on Tesla Daily Podcast:

Tesla Raises $2+ Billion: Everything You Need To Know (TSLA)

I see your Rob Maurer and raise you Dave Lee on Investing:

@DaveT goes into some detail on the timing (relative to SP) and motivation for the raise. An interesting analysis for sure, I found it quite educating!

 

[dw4ngg]

Why are people saying "sold at a discount"??? It is only a discount when comparing apples vs. oranges.. when comparing apples to apples.. COB Wed price was ~$767... so offering is at par...there is no discount.

 

[Nurkbonis]

I could see that. Elon said Cybertruck demand is unlike anything they've seen before and I'm sure Elon would LOVE to get Cybertruck at full production before any other EV truck is at scale as well (F150, Rivian, Hummer, Etc.) If Cybertruck is first to scale production, it will eat a ton of the reservations from other brands due to better range for the price.

If it's not Cybertruck, it's something else that will help the company grow faster - batteries, solar, etc. I am excited as an investor.

BTW, with this whole debate regarding the secondary offering.

Why now? Maybe ... and yes I'm guessing here.

Tesla realizes the demand for cyber truck is greater than expected .... wants to get it off the ground faster than originally planned. In addition we know that Model Y is ahead of the original timeline. Tesla needs somewhere to make the cyber truck ... TX perhaps ??? (just a little guess) .... ok TX it is .. how do we fund? well a secondary offering would get it off the ground very quickly.

Just a thought ...

Cheers to the longs

 

[elasalle]

I see your Rob Maurer and raise you Dave Lee on Investing:

Kudos to Dave. His is best channel for long term mind set.

 

[Prunesquallor]

Lol, Big Boys got theirs for $767. Underwriter's Money Train jus' keeps on chuggin' along...

View attachment 511074

Awesome photo. The Big Boys were just incredible locomotives.

Don’t know if you’re aware, but the one in your post (Number 4014) has been restored and is used for PR runs.

http://www.railgiants.org/docs/UP 4014 Information.pdf

 

[Cosmacelf]

Can anyone explain why we even have pre-market and after hours trading? I never really understood how this is allowed given that not everybody can trade. To me it’s no different than some people having access to non-public information and trading on it before it’s made public. It also seems like it makes it super easy to manipulate a stock.

I don’t know, but volumes in pre and post market are very, very low compared to regular trading. I think you’ll find that prices are not very indicative of the previous and next day trading. Not very good price discovery. When a dislocation happens like an earnings release, it is hard to get a better price than next days regular trading.

 

[elasalle]

$767 was the TSLA closing price two days ago, and the basis if the prospectus.

In the final offer they simply didn't change that price, so the equity round was closed immediately.

Do the underwriters have the option to buy themselves? Similar to Firewall, can one side sell and other side buy?
Asking because if MS, GS can buy @ $767, they will likely sell in a few weeks for instant profits ...

 

[EV forever]

Here comes today’s hit piece in

Tesla raises capital two weeks after Elon Musk said it wasn't needed — FORTUNE


Tesla raises capital two weeks after Elon Musk said it wasn't needed

the gist or the article is Musk went back on his word quote
“A surprise? Not really. Musk u-turns are hardly new”
Then it goes non with the usual FUD, Musk’s contrarian nature, SEC looking into financials etc.

 

[TheTalkingMule]

If Cybertruck is first to scale production, it will eat a ton of the reservations from other brands due to better range for the price.

I don't think you want to scale CT per se, it'll be more effective to have a long limited release period at the advertised price points. That will do two things, set the performance benchmarks and put a cap on market price points for Ford/etc.

 

[X Fan]

Continuous Improvement.......continues:

View attachment 511054

The chart above includes the sales and warranty expenses for all of Tesla's products (Auto, Solar, Storage, etc).
Not only are sales increasing but quality is improving as well, demonstrated by the continuous drop in warranty costs...now at 2.1% of sales.

Makes sense. The Model 3's simplicity facilitates a lower warranty cost vs. the more complex X & older line S.

 

[KarenRei]

New lithium extraction method could reuse fracking wastewater | Mining-Technology.com

Shale boom could fuel batteries | Earthmagazine.org

Cheers!

I estimate from the numbers given in that article that they're talking about water that's something like 6ppm lithium. A typical lithium resource today (whether you're talking salars, spodumene or lithium clays) is usually several hundred to several thousand ppm Li. Of course, Li concentration isn't the only thing that matters - concentrations of other salts matter too, and they don't give any indication of those.

I'd love it, mind you, if MOFs ultimately could render such low-concentration lithium available at economically competitive prices to conventional lithium sources, for one reason having nothing to do with fracking: selectivity and low-concentration absorption are key to making seawater lithium extraction economically competitive, and that's a limitless, minimal-impact resource. But it seems we're far from that point. For the time being, low quality lithium resources = comparatively expensive lithium.

I wonder if Boring Company could turn the Qattara Depression into a gigantic fractional-crystallization seawater salt extractor... I estimate it'd yield about 10t of lithium per day on a metal basis, or 54 tonnes of carbonate, or about $540k/d at current prices, or ~$200M/yr. Plus tons of other minerals, and hydropower potential (conventional and pumped), and increasing middle eastern rainfall, and potential recreation / real estate possibilities.

 

[Cosmacelf]

Anybody have any insight on what the "latest" information request is about? I presume 'Qers have been throwing countless FUD at the wall and something "new" stuck? I've lost track of the conspiracy theories at this point.

In particular, the SEC had issued subpoenas to Tesla in connection with (a) Elon Musk’s prior statement that he was considering taking Tesla private and (b) certain projections that we made for Model 3 production rates during 2017 and other public statements relating to Model 3 production. The take-private investigation was resolved and closed with the settlement with the SEC described above. On December 4, 2019, the SEC (i) closed the investigation into the projections and other public statements regarding Model 3 production rates and (ii) issued a subpoena seeking information concerning certain financial data and contracts including Tesla’s regular financing arrangements. Separately, the DOJ had also asked us to voluntarily provide it with information about the above matters related to taking Tesla private and Model 3 production rates.
(From page 120 Q4 2019 10-K)

SEC is likely just making sure Tesla is dotting their i and crossing their t. It’s a nuisance investigation to make sure Tesla disclosed everything “properly”. There may or may not be any basis for it. The worst that could come out of of it is likely that Tesla disclose more information.