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

[MC3OZ]

If you have a look at the situation today it seems more than likely that there is more room to drop. The spread in Europe is escalating, and I based on what's being reported in the US it seems that it's the same way there.

If you have a look at the measures Italy have taken you might have a good idea of what's coming in several countries. US banning all travel from Europe also seems like an extreme action.

All these actions is bound to impact the economy even more. I can't imagine that all of these measures and their consequences for the economy have been seen yet.

So yes, I expect to be able to buy bellow 500$ in the near feature. I see no reason to be rude even if its not what you want to hear.

Seems like once you claim that the stock will fall some people here gets really upset. I should be possible to discuss the possibility of future drops as well, even if we all agree on that the future for Tesla looks great.

The tricky thing to judge is why markets moved so strongly in response to the virus, if that is under-pinned by true fundamentals which will show up in company balance sheets, if there is an element of an over priced market being corrected and when the cycle will break.

IMO no one has provided compelling answers to these questions as we don't yet have the data, and part of it is a physiological human reaction that is very hard to judge..

So I don't expect the market indices to track infection rates, unless someone can explain why there is a logical connection...

 

[chrsk]

That is OK, for Plan A... but do you have a Plan B?

Short term I am making no predictions, except that we will know the bottom when we see it in the rear view mirror...

I'm all for everyone following their own strategy, that is when markets function best, so you don't necessarily need Plan B, I just don't share your conviction in Plan A, but it is your plan.

A reflected and well balanced post!

Im following the market and the stock closely and will adjust my strategy if needed. At the current point in time I see more bad news down the road, that sure will effect the market.

Btw, what about the drop in oil price. That combined with weaker economy in Teslas core market might have an impact down the road?

 

[KarenRei]

Btw, what about the drop in oil price. That combined with weaker economy in Teslas core market might have an impact down the road?

As a general rule, low oil prices boost the global economy, even though certain sectors and nations lose out. But of course, in this macro environment, anything can be used as an excuse for a freak-out.

 

[FrankSG]

If you have a look at the situation today it seems more than likely that there is more room to drop. The spread in Europe is escalating, and I based on what's being reported in the US it seems that it's the same way there.

If you have a look at the measures Italy have taken you might have a good idea of what's coming in several countries. US banning all travel from Europe also seems like an extreme action.

All these actions is bound to impact the economy even more. I can't imagine that all of these measures and their consequences for the economy have been seen yet.

So yes, I expect to be able to buy bellow 500$ in the near feature. I see no reason to be rude even if its not what you want to hear.

Seems like once you claim that the stock will fall some people here gets really upset. I should be possible to discuss the possibility of future drops as well, even if we all agree on that the future for Tesla looks great.

Maybe, but maybe stellar Q1 delivery numbers and/or earnings come out before the market is able to drag TSLA below $500 into the $400s.

If Tesla shows a strong Q1 in spite of the virus situation in China and now elsewhere, which it's looking like it might, it could brush off a lot of the virus panic that is affecting the rest of the market.

 

[lklundin]

One question that arise is how good is Tesla's leadership TEAM if Musk took a holiday away?

Why would Musk take a holiday? (_that_ would probably make him feel sick...)

At this point I am expecting that Musk and everyone in his companies that work via keyboard & screen will do so from home.

 

[Sancho]

Of course the bottom of the macro fall can’t be timed, but that doesn’t stop gamblers like us from trying, right?

So I’m literally going with my gut. If we can go a few days without new gut punches, then I’ll assume a bottom. So, for example, a bunch more universities closed campuses yesterday, but that wasn’t a gut punch, because campuses started closing a few days ago, so it’s just more of the same. But the NBA postponing its whole season: that’s a new gut punch. Once one major American city is in total Italy-style lockdown, that may be the ultimate gut punch. But it may never come to that, so rather than looking for a particular trigger, I’m looking for a few days without new gut punches.

 

[Artful Dodger]

Rob Mauer's latest Tesla Daily Podcast is now available through Youtube:

 

[aubreymcfato]

I am beyond words at this point...but of course, I will still try.

This is a massive and catastrophic failure in terms of US government response. It is not hard to see that they are (he is) focused on the markets and not the human costs of this disaster. There will be significant consequences for both.

The markets, business, and industries will not be reassured by the BS I heard this evening. Would anyone?

For now, I am not buying and definitely not selling. TSLA is still the safest harbor and Tesla is the best hope for our future.
The sky is darkening and this storm is going to last a good long while...

Wholeheartly agree. Let me repeat, as this is the third week I'm segregated in my home, and every day there are more restrictions: US are hugely underestimating the virus. Italy did this mistake, and it's paying it dearly.
Our excellent public health system (we are talking about the best public and private hospitals in Milan, 9.9/10 points by OECD¹) are overwhelmed and people die because there aren't enough machines. Sanitary personel gets sick.
Market-wise, I know nothing but I fear Wall Street it's not really understanding. If this thing hits New York, they will.


¹ Andrea Baronchelli on Twitter

 

[KarenRei]

On the upside: sooner or later, depending on how tightly we control the rate of spread - anywhere between several weeks and a couple months - almost everyone who's going to get the disease will have had it. That percentage in part depending also on how tightly we control the rate of spread, as that determines how much herd immunity you need to drop R0 below 1.

 

[lklundin]

undermining the virus

Did you intend something else?

 

[aubreymcfato]

Did you intend something else?

Yes, sorry, I meant "underestimating".

 

[Fact Checking]

Just in case it hasn't been mentioned yet, Dow futures have been halted due to hitting the -5% circuit breaker earlier today - there might be a bounce on open, or a further fall.

I'm wondering how long the Fed is going to wait with using their remaining rate cutting dry powder.

 

[Artful Dodger]

TSLA would trigger the uptick rule "curcuit breakers" if the SP touches $570.80 today.

 

[Fact Checking]

Of course the bottom of the macro fall can’t be timed, but that doesn’t stop gamblers like us from trying, right?

So I’m literally going with my gut. If we can go a few days without new gut punches, then I’ll assume a bottom. So, for example, a bunch more universities closed campuses yesterday, but that wasn’t a gut punch, because campuses started closing a few days ago, so it’s just more of the same. But the NBA postponing its whole season: that’s a new gut punch. Once one major American city is in total Italy-style lockdown, that may be the ultimate gut punch. But it may never come to that, so rather than looking for a particular trigger, I’m looking for a few days without new gut punches.

So it would be nice to be able to 'call the bottom', but there's some really big factors of uncertainty that make it particularly hard:

• Real-world economic impact of the virus will be significant - China is still not fully back up running and they had a 2 months head-start. There will be economic data release after economic data releasing showing a worsening economic scenario. Housing activity will probably go down, unemployment will keep ticking up, consumer and industry optimism metrics will keep going down.
  
• Democrats are not going to make it easy for Republicans to enact an economic stimulus of the required magnitude to counter the supply and demand shock - if they do it will be on their own terms, and I just don't see Republicans bowing to that. They'll start blaming the Democrats (this has already started ...), and this will only make the slump deeper.
• I think there's a chance the U.S. will be the worst hit among developed countries, and here I'm including China, South Korea and Italy too...
• Fed rate cutting dry powder is low and QE doesn't have enough credibility.
• Tesla might be affected more directly as well. With 40,000 workers it's only a matter of time until there's an infection at Fremont. Will they stop production lines? Will everyone be wearing masks? How about the end of Q1 delivery rush, when people don't want to go to crowded delivery centers? How about suppliers?
• Good Tesla news might keep arriving, with an unknown effect on TSLA.

So IMO it will be very hard to call the bottom, both on the macro and on the Tesla specific level. Looks harder to call this bottom than in 2008-2009.

I believe a good trigger condition would be when daily infections start slowing down in the U.S. too - and we are probably still far away from that:

# "United.States" daily new infections log:
Feb 29:     3 new cases,     62 total cases ( +4.7%)
Mar 01:     5 new cases,     67 total cases ( +7.3%)
Mar 02:    15 new cases,     82 total cases (+18.0%)  #
Mar 03:     7 new cases,     89 total cases ( +7.7%)
Mar 04:    27 new cases,    116 total cases (+23.0%)  ###
Mar 05:    59 new cases,    175 total cases (+33.5%)  #######
Mar 06:    75 new cases,    250 total cases (+29.8%)  ########
Mar 07:    99 new cases,    349 total cases (+28.2%)  ###########
Mar 08:   137 new cases,    486 total cases (+28.1%)  ################
Mar 09:   120 new cases,    606 total cases (+19.7%)  ##############
Mar 10:   233 new cases,    839 total cases (+27.7%)  ###########################
Mar 11:   171 new cases,   1010 total cases (+16.9%)  ####################

As I believe the lack of widespread testing means that the real number of cases is several factors higher and is currently spreading freely within the U.S.

 

[ev-enthusiast]

Is futures trading currently halted?

 

[JBRR]

Is futures trading currently halted?

Not halted but can't go below -5%

 

[JBRR]

Adam jonas found the time to downgrade PT from $500 to $480....
Talk about majoring in the minors.

 

[ev-enthusiast]

[...]
Tesla might be affected more directly as well. With 40,000 workers it's only a matter of time until there's an infection at Fremont. Will they stop production lines? Will everyone be wearing masks? How about the end of Q1 delivery rush, when people don't want to go to crowded delivery centers? How about suppliers?
[...]

I belive they are wearing masks.
I can not imagine anyhting else right now.
They do not want a patient to infect other individuals right now.

 

[Md90]

Available inventory is sky rocketing. Something to keep your eye on as an investor. Which makes me think the first thing people will stop buying is a car. I guess boat might be the very first

 

[vikings123]

Available inventory is sky rocketing. Something to keep your eye on as an investor. Which makes me think the first thing people will stop buying is a car. I guess boat might be the very first

This is what I worry about from a balance sheet perspective end of Q1 and the first half of Q2.

I hope they are able to deliver as many cars as possible this quarter. We might also have to adjust production rate for Q2 because of supply chain and temporary demand pullback.