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

[adiggs]

This is almost precisely my scenario. Was wondering how I would feel about this worst case scenario. Feeling pretty great doubling down at ~$362.

I just started thinking about this today. I think it's time to have a conversation with my wife (we make these decisions jointly).

I would go WAY out of the money and approach this as more of a dividend style play, with the downside of accidentally acquiring more Tesla shares at a really good price (like selling 300 strikes for $24 for example). I could take on some additional TSLA shares for $276...

Repeat monthly - that would be some really good dividend money (like 8% per month!?!).


For those not clear on selling puts to generate income, the big downside (which I narrowly avoided in '12 / '13) is you're busy collecting premium month to month, but never get assigned. Then the stock price takes off and you don't have any shares. In '12, we got assigned at a 29 strike. In retrospect, I don't know if I'd have continued selling puts until I got assigned, and about 5 months later is when the stock took off and established it's new trading range in the 130-180 range. I could have easily been on the sidelines for that. I learned therefore, that if I really want a position (long shares), then I should seriously think about just buying and getting too cute.

This works well for me because I have about as many shares as I really want. If I did get exercised, I probably start selling nearby OTM calls to turn those exercised puts back into cash (rinse, repeat). The overall trade can still go "badly", in either direction.

In my case, what makes it work is being assigned more shares that I would gladly take, and being paid in the meantime (or forever) not to take them. I won't "miss out" on a big share price rise, because I'm already positioned adequately (for me) for that big price rise.

 

[Alphacrux]

The article from the SF Chronicle was very clear:

I’d better get out for supplies here in Austin while we can. We’ve got only a couple of weeks worth of beer left.

 

[ninpb]

Anybody think mega pack projects might still go strong during these quarantine times? Maybe new projects going forward?

 

[mongo]

Gas stations and auto-supply, auto-repair, and related facilities;

I read that as auto parts stores (for repairs, oil, wiper fluid), not manufacturers.
Although, isn't Tesla the only auto plant in CA? Might have/ get a non listed exemption.

 

[Oil4AsphaultOnly]

Maybe I'm stating the obvious, but the short term financial ramifications of a 3 week shutdown would be quite significant, correct? Like on the order of a billion dollar Q1 loss? And this would obliterate any chance of S&P inclusion for maybe a year.

I'm not trying to promote FUD if someone could better estimate the costs of a 3 week loss of product, that would be informative...

I think this all gets offset by the COGS side of that equation. 18k of cars, 250M of revenue (Karen's WAG), but less 200M of COGS = $50M Q1 loss?

-- rescinded. Fact Checking's numbers are better.

 

[KSilver2000]

Just keep in mind, these loss calculation exercises are in the best case scenario that shutdowns aren’t extended beyond 3 weeks.
(I guess there’s a sliver of chance that it could also end before the announced 3 weeks.)

 

[mongo]

Just keep in mind, these loss calculation exercises are in the best case scenario that shutdowns aren’t extended beyond 3 weeks.
(I guess there’s a sliver of chance that it could also end before the announced 3 weeks.)

Q1 only lasts two weeks.

 

[SOULPEDL]

The article from the SF Chronicle was very clear:

What if Elon puts up another tent in Fremont, and declares it his home where everyone there can also live?
There's space on the roof too!

 

[Buckminster]

UK just got locked down. I'm WFH indefinitely.

 

[Fact Checking]

I read that as auto parts stores (for repairs, oil, wiper fluid), not manufacturers.
Although, isn't Tesla the only auto plant in CA? Might have/ get a non listed exemption.

Unless these are well defined terms, government orders should generally be read in the most permissive fashion. (But I don't know how to interpret county health directives.)

 

[Dutchie]

Just bought some cruise line stock. See how that goes...

 

[Kenypowa]

What if Elon puts up another tent in Fremont, and declares it his home where everyone there can also live?
There's space on the roof too!

Now we know why there is a cave in Giga Berlin.

 

[deffu]

Here's the County of Santa Clara order:

Order of the Health Officer of the County of Santa Clara - Public Health Department - County of Santa Clara
​

Tesla factory might be exempted:

For the purposes of this Order, "Essential Businesses" means:

• Newspapers, television, radio, and other media services;
• Gas stations and auto-supply, auto-repair, and related facilities;
• Banks and related financial institutions;
• Hardware stores;

If hedge funds, business rags and car dealerships can stay open, Fremont certainly looks essential as well as an "auto-supply" facility.

Great info! Please note Telsa's HQ is located in Palo Alto, which belongs to Santa Clara county. The Fremont factory is within Alameda County. But I suppose the order would be similar.

 

[mars_or_bust]

OK, Elon did the right thing, and indirectly (and in a very smart manner) admitted that his corona virus stance was wrong. He is now tweeting potential cures for the virus. I predicted (got a ton of disagrees for that) that Elon would during the weekend do the grown up thing and admit he was wrong -was off by one day

 

[Nocturnal]

Anybody think mega pack projects might still go strong during these quarantine times? Maybe new projects going forward?

I sure hope so, because my job requires utility capital projects to continue. (I'm on the software side) FWIW, utility companies are pretty much immune from market downturns. Regulated prices/costs, and people really can't decide to stop using electricity just because the market is down.

 

[Artful Dodger]

The FINRA Short Selling Volume Report for Fri, Mar 13, 2020 is out. "Short Exempt Volume" a.k.a. Market Maker's naked shorting, was again unusually high at 6% of "Short Volume", which ranks at the 128th Percentile (making it highly unlikely to occur by simple chance).

The FINRA Short Selling Volume Report for Mon, Mar 16, 2020 is out.

"Short Exempt Volume" a.k.a. Market Maker's naked shorting, was again unusually high at 7.19% of "Short Volume", which ranks at the 147th Percentile (making it highly unlikely to occur by simple chance)

Note that the -10% curcuit break was again tripped at the Open today, so the "Uptick Rule" should continue in effect for the 4th consecutive day tomorrow, Mar 17, 2020.

 

[mongo]

Unless these are well defined terms, government orders should generally be read in the most permissive fashion. (But I don't know how to interpret county health directives.)

I can dig it.
Dealerships are auto supply (and auto repair), and Tesla is related to them.

I sure hope so, because my job requires utility capital projects to continue. (I'm on the software side) FWIW, utility companies are pretty much immune from market downturns. Regulated prices/costs, and people really can't decide to stop using electricity just because the market is down.

Have you seen PCG? Down 50% in the last three weeks. Opportunity?

 

[NicoV]

France is in lockdown now, only people in essential services can go to work now.
So no Tesla deliveries in France anymore in Q1.

It seems that going to work is still allowed, so maybe the last cars can still be delivered: La France confinée face au coronavirus : déplacements réduits dès demain, fermeture des frontières de l’UE, report des municipales

There are rumours that Belgium will go in lockdown tomorrow. It’s not a question of ‘if’, but ‘when’. The question is what that means for Tesla’s operation in Zeebrugge.

 

[lklundin]

Don't be afraid to ask It's a touch over two weeks of production, almost all of it which of likely would have been sold in this quarter, unless they'd been planning to start pre-producing for Q2 overseas markets. Maybe 18k cars? Maybe $250M?

OK. Well, given the positive results of 2019Q3/Q4, with any (GAAP-)profit in 2020Q2, Tesla could have a loss of up to 248M$ in Q1 and still qualify for S&P 500 inclusion w. Q2.

 

[Nocturnal]

Have you seen PCG? Down 50% in the last three weeks. Opportunity?

I'm always worried they will do something stupid again. I avoid the sector entirely myself as it just increases my risk exposure.