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

[powertoold]

Who's gonna set up a call to Alameda county to protest?

 

[BornToFly]

Now if you had bought those 1000 shares 41 days ago when I bought my last shares you would be up over half a million dollars by now!

Don't remind me!

 

[Rammstein]

Reference ?

I looked up your claim -- it is conspiracy theory garbage disseminated by the Russian propaganda outlet Pravda.

Here is peer reviewed science:
Life and death during the Great Depression

Fair enough. So you think a depression would be better than a methodical plan to open the economy back up?

Not sure why this is Russian propaganda...

 

[MC3OZ]

I was under the impression they’d want a second Giga in Asia before a fourth one in the US

They want to build Cybertruck and Model Y at the next US GF.

Shanghai is going great, they are more likely to expand that factory, looks like land is available nearby.

If they do another major Asian factory it will almost certainly be in China, I'm not sure how much of a factor internal logistics in China are, one factory is probably easier to manage for now..

Fremont is the only US car factory, space is limited, it can;t be expanded further, Nevada and Buffalo are not that suitable for vehicle production at present...

The semi may still be built at/near Nevada...

In the earnings Elon call Elon said expect an announcement on the next US GF soon.

 

[Artful Dodger]

Gene Munster to be on CNBC in a few minutes discussing TSLA. 5:13 now.

Generally, this was hilarious with only Gene getting it! 5:33 now

"Loup Ventures' Gene Munster weighs in on Tesla's earnings report"

Darn, missed it.
Any feedback you can offer?

Paging @X Fan

Cheers!

 

[StealthP3D]

I said it this morning, but I invest in Tesla, not Elon.

So the reason my net worth has increased more in the last 24 hours than most people make from years of full-time work is not due to Musk but rather in spite of him?

OK, got it.

 

[MC3OZ]

Now Karen is looking to distort Icelands CT delivery statistics;-
Nafnlaus on Twitter

She has run amok since escaping from here...

 

[wipster]

The transcript is up on Sucking Alpha...

 

[ZachF]

That's a very good point I hadn't considered. Still it sounded to me like there will be another Giga announced on top of the one in Texas. But then I'm a little unsure why they'd do 2 in the USA, one for the east coast and one in Texas. Perhaps they expect Cybertruck demand to be so high that they want one on both coasts? Perhaps the semi is also going to be built in one of these new factories? And what will the rest of the space at Giga Nevada be used for then?

I have more questions than answers

Perhaps Giga Texas will be battery cells + battery storage.

There will be plenty of demand in NA for Cybertrucks and Ys to necessitate a new factory.

Hell, if Tesla expands the Cybertruck into a Cybervan and Cyberute they could probably sell a million+ of those per year in North America.

I also wouldn't be surprised to see GigaTexas be a million+ capacity giant just so Elon can stick a finger in California's eye...

 

[FrankSG]

I was under the impression they’d want a second Giga in Asia before a fourth one in the US

Elon explicitly mentioned the new Giga announcement in the next 1-3 months will be in the USA. We can expect this to be on the east coast, because Tesla has mentioned before they want a second Giga in the USA to more efficiently serve the east coast.

Shanghai is going great, they are more likely to expand that factory, looks like land is available nearby.

I think it's more likely than not a new Giga in China will be announced by the end of 2021, if not end of this year or early 2021.

It seems as if Giga Shanghai is designed to do ~500k vehicles per year, and it looks to me like demand in the country, and certainly APAC, will far outpace 500k/year.

Once Tesla confirms this level of demand, and has the available resources, they should start working on a 2nd Giga in China.

 

[CaliBear1]

Maybe because he includes in his "team" the tens of thousands of employees at Tesla who cannot work from home and are struggling to make ends meet while Alameda County ignores its largest private sector employer's known ability to manufacture and operate safely under pandemic conditions and imposes conditions more onerous than even the state.

What a massive bummer it must be for the team to have him walk all over their hard work in q1 and selfishly shift the headlines to this crap. Chamath, give him a call please!!!

 

[mickificki]

 

[mongo]

That's the impression I got from listening to the call. Especially when Elon later said that the next Giga will be announced within 1-3 months, and would be for the USA.

My interpretation is that the one in Texas will be for batteries, as he said they would hopefully hold Battery Day there. And the other one that will be announced within 1-3 days will serve the east coast and probably produce Cybertrucks and Model Y for the east coast (and maybe semi too?).

My interpretation could be wrong, but I'd think that he wouldn't talk about holding batter day at a factory in Texas and then a few minutes later talk about a new Giga announcement if these factories were one and the same.

Texas is the potential battery day site because they may not be able to hold it in Cali.
https://seekingalpha.com/article/43...k-on-q1-2020-results-earnings-call-transcript

We think probably the right timing will be the -- probably the third week of May. Not giving a firm date, but we think that probably that's the right timing. And depending upon what we're allowed to do, it will either be in California or Texas.

Next US Giga makes Y and Cybertruck:Twitter

Twitter

Note: that was clarified to be one location not two.

Most likely with pack/ cell on site, like Shanghai and Berlin:
Twitter
Twitter

 

[Big Dog]

There will be plenty of demand in NA for Cybertrucks and Ys to necessitate a new factory.

Hell, if Tesla expands the Cybertruck into a Cybervan and Cyberute they could probably sell a million+ of those per year in North America.

I also wouldn't be surprised to see GigaTexas be a million+ capacity giant just so Elon can stick a finger in California's eye...

There's no question that Tesla needs more capacity, so it makes business sense to look outside of CA. (I've posted previously about CA not being a good place for manufacturing and have gotten a lot of dislikes, but I stand by my pov. CA is just a difficult and extremely costly place to conduct business. Brilliant engineers, and great for R&D, but....) Whether Elon looks to Texas or another state depends on the money or if a nearly free plant like NUMMI is sitting around. If Texas, they'd have to step up and allow direct sales.

One of the beautiful things about the (derided?) tent product line is that it's in a tent. The tent line can be taken down and relocated as fast as it was put up. That line alone gives Elon some limited negotiating leverage with the State.

 

[Prunesquallor]

Now Karen is looking to distort Icelands CT delivery statistics;-
Nafnlaus on Twitter

She has run amok since escaping from here...

She's getting a Cybertruck? Her options strategies must be working well (of which I have no doubt).

I wish I could stay in touch with her, but Twitter makes my skin crawl.

 

[troym]

My take on earnings:

Financial results were solid, but pretty much exactly in line with what I expected if you exclude the $200M in additional credits sales. I had read through the ER before I looked at the SP, and I was expecting it to most likely be between $850 and $900, maybe $900+, because I expected the market react positively to the net income beat, even though it's largely attributable to credits sales. This turned out to be spot on.

Other than that there were a few negatives and a few positives that stood out to me in both the report and during the call:

Negatives:

• FCF was quite a bit worse than I expected. I knew the increase in inventory would have a negative impact, but I was still expecting about break even, rather than almost negative $1B. I'm not worried about Tesla's cash position though, so I don't care too much about this.
• It appears as if Fremont is going to cap at 500k 3+Y per year. I was expecting/hoping they'd go up to 750k. It sounds like they believe long term M3 demand in North America might be 200-250k, and MY demand about double. So I now expect Fremont to do 5k/week of each, and a 2nd Giga in USA to produce an additional 5k/week MY.
• Looks like the near term Shanghai production target is 4k/week rather than the 5k/week I anticipated.
• The answer to my Solar Roof question was a little disappointing. I was secretly hoping for more ambitious targets after seeing the 1k/week production tweet last month, but it sounds like Solar Roof will only reach 1k/week installations by late 2020 or early 2021, and perhaps 2k/week by the end of 2021. The long term potential seems great, but it sounds like Tesla does not have enough resources to ramp this product as fast as its automotive products.

Positives:

• Elon continues to be very bullish about FSD on every call. He is only barely walking back some of the targets he set out during the Autonomy investor day. Sounds like he expects somewhere in between feature complete and hands-off this year, and hands-off robotaxis next year. Although I don't believe this will happen, his comments make me want to be very bullish on "safer than a human" FSD in at least some geographical regions in the 2022/2023 time frame.
• An increase in order backlog both for automotive and battery storage, in spite of COVID-19, is a very strong sign. I remain quite optimistic about Tesla achieving at least 500k vehicle deliveries this year. If the Fremont shut down is extended by another month, that could cut it quite close, but these are great signals about demand nonetheless. I also like the way they're handling guidance. Happiness = Reality - Expectations seems to be their motto as of right now.
• The hype around battery day remains as strong as ever. "The best day in Tesla's history". And it sounds like the Gigafactory in Texas will be exclusively for battery production.
• Another Gigafactory announcement within 1-3 months is almost just as much hype. I took it as being a different factory than the battery Gigafactory in Texas, probably the Eastern USA factory for Cybertruck and Model Y we've been hearing rumors about.
• Elon's answer to the 50% growth rate and 4M+ in 2025 and 20M+ in 2030 was also very positive to me. Although I personally was already expecting ~4-5M by 2025, and by 2030 12M+ in a worst case and 20M+ in a best case, Elon more-or-less confirming this bodes well for Tesla's internal long term aspirations.

All in all, a solid earnings. Nothing too unexpected financially, and as always some negatives and some positives. I'd rank this as a slightly better earnings than Q4'19, but a lot worse than Q3'19. In my opinion, Tesla's Q3'19 ER still ranks as the best in its now almost 10 year history as a public company.

Great points but I believe the comment on largest automotive backlog ever was as of end of q4 19, no? I assume many cancellations since then...

 

[ZachF]

They want to build Cybertruck and Model Y at the next US GF.

Shanghai is going great, they are more likely to expand that factory, looks like land is available nearby.

If they do another major Asian factory it will almost certainly be in China, I'm not sure how much of a factor internal logistics in China are, one factory is probably easier to manage for now..

Fremont is the only US car factory, space is limited, it can;t be expanded further, Nevada and Buffalo are not that suitable for vehicle production at present...

The semi may still be built at/near Nevada...

In the earnings Elon call Elon said expect an announcement on the next US GF soon.

Tesla wants to eventually make 20m cars... So you're talking about probably 40 gigafactories eventually. Many more in USA, China, Europe, India, Brazil, Mexico, Indonesia...

Queue the Oprah meme...

 

[bubb]

Maybe because he includes in his "team" the tens of thousands of employees at Tesla who cannot work from home and are struggling to make ends meet while Alameda County ignores its largest private sector employer's known ability to manufacture and operate safely under pandemic conditions and imposes conditions more onerous than even the state.

Please spare us your outrage on behalf of Tesla employees: the state (with federal support) has implemented a special unemployment scheme of up to $4200 per month in benefits through July exactly for this situation. It's not surprising to see the Elon flailing and desperate for a nearly billion dollar payday based on stock performance, but the bad PR and bad will with local authorities will far outweigh any benefits for our shares.

I have been on this rodeo with the stock price since $30 and change, but have bought shares as high as $800, so please understand I have near-total confidence in the long-term prospects of this company, but a few of us are going to vent today about how upsetting it is to see the figurehead compromise the humanist values at the core of what we invested in. I'll go back to lurking now, all the best.

 

[FrankSG]

• An increase in order backlog both for automotive and battery storage, in spite of COVID-19, is a very strong sign. I remain quite optimistic about Tesla achieving at least 500k vehicle deliveries this year. If the Fremont shut down is extended by another month, that could cut it quite close, but these are great signals about demand nonetheless. I also like the way they're handling guidance. Happiness = Reality - Expectations seems to be their motto as of right now.

I want to update my stance on 2020 (and 2021) deliveries after re-crunching some numbers. I do believe that if Fremont opens on May 4th, 500k in 2020 should still be very achievable. However, based on this Q1'20 ER it now appears that Fremont will cap out at 500k 3+Y, so I think they could miss 500k deliveries in 2020 if Fremont opens late May/early June.

Here's what I'm expecting now for 2020 & 2021:

2020 Bear

S+X: 45k
Fremont 3: 200k
Shanghai 3: 160k
Fremont Y: 65k
Total: 470k

2020 Bull

S+X: 60k
Fremont 3: 230k
Shanghai 3: 175k
Fremont Y: 95k
Total: 560k

2021 Bear

S+X: 60k
Fremont 3: 250k
Shanghai 3: 250k
Fremont Y: 250k
Shanghai Y: 125k
Berlin Y: 15k
Total: 950k

The main risk to this 950k in my opinion is insufficient battery cell supply.

2021 Bull

S+X: 75k
Fremont 3: 250k
Shanghai 3: 250k
Fremont Y: 250k
Shanghai Y: 175k
Berlin Y: 50k
Total: 1,050k + Cybertruck? + Semi?


So a range of 470-560k for 2020, and a range of 950k-1,050k for 2021.

 

[Drumheller]

Please spare us your outrage on behalf of Tesla employees: the state (with federal support) has implemented a special unemployment scheme of up to $4200 per month in benefits through July exactly for this situation. It's not surprising to see the Elon flailing and desperate for a nearly billion dollar payday based on stock performance, but the bad PR and bad will with local authorities will far outweigh any benefits for our shares.

I have been on this rodeo with the stock price since $30 and change, but have bought shares as high as $800, so please understand I have near-total confidence in the long-term prospects of this company, but a few of us are going to vent today about how upsetting it is to see the figurehead compromise the humanistic values at the core of what we invested in. I'll go back to lurking now, all the best.

The payout has already been postponed. This has nothing to do with Elon's stock earnings.