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

[UkNorthampton]

A lot of rich kids today, a lot of phantasizing about how to spend that new found wealth. But remember, it's all still on paper. Nothing in your pockets until you sell. The price targets are still far away and it could (will) be a rocky ride. Once you start thinking about what you could do with all that paper money, you're stepping on thin ice. When the SP starts plummeting, for days on end, losing hundreds of points, it may be hard for some to hold on and not panic sell, seeing those early retirements, mortgage free homes and new cars disappear again. I made the mistake once, but was lucky to get away with just a scratched ego. Keep a cool head.

I hadn't thought about it before someone here mentioned, but looks like it may be possible to borrow against investments. May not be legal to be secured against a UK ISA, but it may be possible to borrow as an unsecured loan. I just found one company that discusses it - but just lost the link!

That gives you options - one would be to work out a value that allows you to retire/take a break. Consider the break as a way to find yourself, further investment ideas or a new career. Then borrow for spending money. I think this would be untaxed. You'd have to roll it over and keep adding to it - so compound interest is against you, but you keep your shares. If you believe in faster Tesla growth, and the loan to value keeps getting smaller, this can continue. Pay back could occur in a number of ways,

1. death - as part of settling estate, although the investments (in a shares ISA - for UK tax residents) and loans could continue to the spouse
2. sell some shares when you think the time is right
3. takeover of tesla
4. dividends - eventually most shares get dividends, even a tiny yield would pay for the interest and principal from frugalish living and Tesla growing faster than borrowings. UK ISA - no tax on dividends from a quick google but that can change. Whether Tesla pays dividends in the future is a question. If they don't, they probably have a better use for the money so share price goes up from new investments - sell some shares instead.

 

[Tslynk67]

Is this an appropriate place to link to Omar Qazi's legal gofundme? Legal Defense Against Aaron Greenspan organized by Omar Qazi. Saw FC/truth tesla retweeting it.

Here's the campaign description:

After threatening and harassing me ever since he doxxed me on my birthday in 2019, Tesla short-seller Aaron Greenspan has now filed a lawsuit against me and Elon Musk.

This legal defense fund will be used to defend against Aaron Greenspan's frivolous lawsuit and bring light to the unlawful conduct of Tesla short sellers like Greenspan.

I don't expect anything from anyone, but if you want to chip in thank you so much for reducing the burden on myself and my family. I can never thank you enough.

Even one dollar helps. I appreciate you all a lot

–– Omar Qazi

I would hope Elon would pick-up Omar's tab, but donated anyway, just in case.

Note sure how Greenspan could afford to take legal action given the losses on his short positions - and none of his pals would have anything to donate either.

 

[Tslynk67]

For those that didn't notice, Elon has updated his description as being a "Budgie Smuggler"

Aussie slang:
What does budgie smuggler mean?
(swimming costume): A jocular reference to a man's tight-fitting swimming costume or swimsuit appearing as if he has a budgerigar concealed inside it, ie. his bulging genitals.​

 

[tinm]

LG converting a factory to build Tesla batteries. Tesla eating up global capacity.

Battery squeeze anyone?

LG Chem to produce Tesla batteries in South Korea this year as demand grows: source

Has me wondering...

• The original GF1 is only, what, 30% built.... and there’s been no external indication of any major expansion there.
• Lots of new EV competition coming out this year and next.
• We’ve seen Tesla cutting deals with two major battery suppliers, CATL and LG... that the competing OEMs need.

So the question is, could Tesla be doing this deliberately, as a competitive maneuver? Rather than be self-reliant and make and use only its own batteries, save some capex while eating into the much-needed supply the other OEMs are counting on?

 

[HG Wells]

If your real job is not fun change your real job. It is possible to have only jobs that make you happy to have them. I have been very lucky in that respect.

If you do have a job like that DO NOT tell your boss !

In the 1990's I LOVED my job. Running around the country demoing the software.
The only application engineer who was also a salesman.
I told my boss I really really loved my job so much I would do it for FREE.

Never say that to anyone. Never !

 

[vikings123]

Two quick analyst notes including Adam haha.

Morgan Stanley analyst Adam Jonas raises $TSLA PT from $650 to $740 writing: "Over the past week, the company is adding to its valuation an amount roughly equal to Ford’s entire market cap on a daily basis. We’re struggling to play catch-up here with the valuation..."

Barclays on Tesla "While we still believe TSLA is fundamentally overvalued, we see nothing to prevent the shares moving higher in the coming weeks and urge our bearish friend (perhaps emboldened by a $1,400 stock price) to remain in the shelter of their caves.”

 

[CorneliusXX]

I am hopeful that in the future Tesla will be in a similar situation as Apple in that they will be throwing off enough cash each quarter to where it no longer makes sense to keep piling it up. I'd love to be able to live off of divvies instead of periodically divesting of shares.

Honestly I think Elon's ambition is so great and the capex required to fully achieve the sustainability mission is so large that it's unlikely they will be in a position to have additional profits.

Think of the capex they need to produce an autonomous fleet when they're not selling these vehicles.

How much would it cost to design and build zero emission aircraft or shipping. What if they need to get into mining.

 

[Todd Burch]

Morgan Stanley analyst Adam Jonas raises $TSLA PT from $650 to $740 writing: "Over the past week, the company is adding to its valuation an amount roughly equal to Ford’s entire market cap on a daily basis. We’re struggling to play catch-up here with the valuation..."

Sheesh, that's an understatement of the century if I've ever heard one! Jonas has been struggling to play catch-up with TSLA for 5 years now!

Pro tip: Try putting out a price target ABOVE the current share price for once. Then you'll find, for a brief moment, you're actually ahead.

Bonehead.

 

[EV forever]

So the only question in my mind today at this 5 am morning time here in CA is - will we see a repeat of Black Tuesday Feb 5. This price action feels so similar to that week. Want to be prepared for any such shenanigans that MMs May try today.
For those who don’t remember or are new here, @Papafox post from that day for reference. Papafox's Daily TSLA Trading Charts

 

[UkNorthampton]

Honestly I think Elon's ambition is so great and the capex required to fully achieve the sustainability mission is so large that it's unlikely they will be in a position to have additional profits.

Think of the capex they need to produce an autonomous fleet when they're not selling these vehicles.

How much would it cost to design and build zero emission aircraft or shipping. What if they need to get into mining.

Even if this is true, it's great! Teslas scope, market cap increases. I'm all for it rather than dividends and share buybacks that less ambitious companies do just because they have no idea how to use the money for investment and they just stand still or worse.

 

[charlesgres]

Thanks - opposite of what some others have said, so who knows!

I'll be happy to stand corrected, but at least it answers your question of when to sell: it doesn't really matter.. by rolling up you replace your calls by cheaper ones, so you can buy more contracts or you pocket the difference as a way of taking profit.. Either way you remain in the game if the SP keeps rising.. And by buying an expiry six months or further, they're kind of long as well, so a temporary dip has time to correct with theta to spare..

Edit: e.g. last Thursday, I replaced two calls 1280 jan 2021 with four 1880 jan 2021, with still left me 9k in cash, from which I bought 5 shares.. These four 1880's doubled in value in the meantime.. (So I sold one and bought 10 more shares..) It would not have mattered a lot on thursday when exactly I made the switch..
Edit2: as long as you switch while it plateaus a little..

 

[hoang51]

So the only question in my mind today at this 5 am morning time here in CA is - will we see a repeat of Black Tuesday Feb 5. This price action feels so similar to that week. Want to be prepared for any such shenanigans that MMs May try today.
For those who don’t remember or are new here, @Papafox post from that day for reference. Papafox's Daily TSLA Trading Charts

I'm in the same boat as you are. During that run up, by luck, I had a stop loss set up due to the crazy run up in order to prevent any shenanigan by the market, which worked well near the end of the day.

What differs is that today's broad market is down. I'm thinking there will probably be a limited gain compared to that last run up.

 

[Words of HABIT]

S&P500 inclusion will force S&P500 index funds to purchase TSLA. That is a given. I have yet to hear any talk about other funds that clearly stipulate in their prospectus that companies within their funds must be included on S&P500, and there are many. Let's take four funds with this requirement and call them Fund A, B, C and D. Once Tesla is added S&P500, Fund A adds TSLA to their portfolio mix. Due to TSLA's running high return, and considering the four funds are in competition with each other knowing their clients can jump ship to the firm generating the largest return, funds B, C and D will most likely want a piece of the action to ensure they don't get left behind and lose their customer base.

I remember this happening with technology company Nortel Networks back in the late 90s. NN at that time was Canada's most valuable company valued at $100B. This was before the word Trillion was invented. Back then to spread my risk, and because I had no idea what I was doing, my investments were in mutual funds at the time in Health & Science, Technology, Industrial and (agas!) Oil & Gas. What puzzled me is that the annual reports of my holdings showing the breakout of these funds into individual stocks, each of these funds diverse in their special area of expertise, all showned NN at 5% of their fund, which was the maximum allowable (think ARK at 10%) . If the fund did not have the maximum 5% allocation to NN, no matter what the fund's focus was on, they would underperform their peers and then lose their customer base. Everyone wanted a piece of NN.

 

[Unpilot]

Snip-it from a Market Watch article:

Analyst Ryan Brinkman at JPMorgan raised his stock price target by 7.3% to $295, but that was still 78.5% below current prices. Brinkman’s target remained the lowest of the 32 analysts surveyed by FactSet.

Tesla’s stock soars to 4th-straight record as Wall Street’s biggest bear raises price target

Can't make this stuff up!

 

[TheTalkingMule]

We're approaching market hours. Can we take the tax discussion to another thread?

 

[elasalle]

I'll be happy to stand corrected, but at least it answers your question of when to sell: it doesn't really matter.. by rolling up you replace your calls by cheaper ones, so you can buy more contracts or you pocket the difference as a way of taking profit.. Either way you remain in the game if the SP keeps rising.. And by buying an expiry six months or further, they're kind of long as well, so a temporary dip has time to correct with theta to spare..

Thats my understanding as well, OTM's will have better leverage (but more RISK). Here is simple formula I picked up googling a while back. and sampled prices with. The other greeks are not considered here, but they too will impact the Option Price.

Leverage = (Delta*SP – OP)/OP ... where SP is the Stock Price, and OP is the Option Price.

 

[LJS22]

So the only question in my mind today at this 5 am morning time here in CA is - will we see a repeat of Black Tuesday Feb 5. This price action feels so similar to that week. Want to be prepared for any such shenanigans that MMs May try today.
For those who don’t remember or are new here, @Papafox post from that day for reference. Papafox's Daily TSLA Trading Charts

I think all dips will be bought up. It’s really as simple as do you think Q2 is profitable? Is S&P inclusion real? Any attacks on the stock will be met with heavy buying. I don’t put it past them to try, but it could be the equivalent of stopping a train at this point.

 

[Twooz]

I'm in the same boat as you are. During that run up, by luck, I had a stop loss set up due to the crazy run up in order to prevent any shenanigan by the market, which worked well near the end of the day.

What differs is that today's broad market is down. I'm thinking there will probably be a limited gain compared to that last run up.

Do you have another stop loss set now?

 

[TheTalkingMule]

Solar energy company Sunrun to buy peer Vivint Solar for about $1.46 billion

$3.2B including debt is quite an amount to pay for an entity with a similar bloated sales model. The combined entity is valued at something north of $9B, with no path to sustainable profits.

With an average cost basis of around $3.50/Watt, I see Tesla(priced at <$2/W) eating their lunch over the next 2 years and buying them out cheap. My price point was about $1.5-2B in 2022. We shall see ...

 

[mongo]

Solar energy company Sunrun to buy peer Vivint Solar for about $1.46 billion

$3.2B including debt is quite an amount to pay for an entity with a similar bloated sales model. The combined entity is valued at something north of $9B, with no path to sustainable profits.

With an average cost basis of around $3.50/Watt, I see Tesla(priced at <$2/W) eating their lunch over the next 2 years and buying them out cheap. My price point was about $1.5-2B in 2022. We shall see ...

What value would two bloated companies have to Tesla (especially with direct/ on-line sales and their own supply chain)?
Tesla could hire the installers directly and avoid the technical and fiscal debt.