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

[Tslynk67]

But the company is worth $5B more than it was before, which is also a bit more than 1%. The value of your shares is unchanged.

If I understand it well, the shares are created as of yesterday at closing, so $498.something, if Tesla sell them at a higher price on market, the dilution could be significantly less.

No?

 

[Gabos]

The truth is that nobody here (or anywhere so far as I know) has been unable to conduct their trading as they wish, barring certain unusual circumstances involving foreign banks and proxies who warned their customers in advance that it would take some time. There's just no there there. Simply idiotic conspiracy theories. And all while people here are making money like crazy.

...well...

So I just bought 1 share using my share.com account.
Let's say I had 10 shares before the spilt. My account today still shows 10 shares (not 50) but the value is the post-split value.
I just bought one for the post-split value and now I have 11.

 

[mickificki]

If Gali needs to liquidate 10% of his TSLA position to buy a MY, that means he is not even a Teslanaire yet... We really should start a GoFundMe campaign for the guy

He’s also an investor in spacex, pretty sure he’s not hurting for money.

 

[Dancing Lemur]

There is so much volume and buying pressure. Is this buying from:

• Retail
• Institutional
• Hedge fund/momentum traders
• Other?

There is plenty of retail FOMO, but the vast amounts of cash being poured in lead me to believe a great deal is due to the bigger players. The question is, what kind of split is there between the institutional (primarily buy-and-hold) and those trying to front-run S&P inclusion?

Depending on the amount of front-running, there may be plenty of liquidity available to the index funds, and the inclusion announcement (or inclusion date) may be a near term top — Q3 and battery day notwithstanding.

On the other hand, AAPL has been tearing it up since announcing their split, and it continues to, with no other catalyst and in a more mature space with fewer growth prospects. So maybe the “entire market is a bubble” theory is more likely.

As a shareholder, I’m very happy with how management is navigating this period so far. For most companies, I’d be here shaking my fist and demanding to know why they haven’t done a split or raised capital at the inflated SP. They’ve done both, and not to any extreme, remaining flexible and lean.

Being critical of management decisions and style used to be one thing the bears could hang their hat on that was difficult to refute. It is now a strength.

 

[engle]

Thanks for this! Even though this is so poorly written with grammatical errors.....anytime GJ speaks about $TLSA....$TSLA rockets

In that case, we should all email Al Root to write more stories quoting GJ! Noticed GJ said "demand is drying up". Is that "drying up" like an oil well? He might be on big oil's payroll lol.

 

[Stretch2727]

And/or slow down stock rise a little to make it a more healthy sustainable rise. I see a lot maturity in this move from multiple perspectives.

Tend to agree. I think this was structured for the S & P 500 inclusion.

Keep in mind $5B is just 7% of the approximately $65-70B they need to buy just for the index funds assuming a SP of $500.

Will it help, yes, but $70B is still a lot more than $5B.

We maybe able to see the min price Tesla has set during the transition period. My guess it the price will rise easily and level off around the min price as the index funds try to manage the transition. They may reset the min price limit daily depending on well the transition is going.

 

[mongo]

If Gali needs to liquidate 10% of his TSLA position to buy a MY, that means he is not even a Teslanaire yet... We really should start a GoFundMe campaign for the guy

Gali needs a car loan...

If I understand it well, the shares are created as of yesterday at closing, so $498.something, if Tesla sell them at a higher price on market, the dilution could be significantly less.

No?

No, they are generated on demand as Tesla allows them to be sold. The dollar value is capped though, so the higher they sell for, the less shares total.

 

[Bet TSLA]

The point is other beneficial owners DO NOT have their shares, and have only vague promises that they will receive them at an indeterminant future date.

You are just making this up. If not, provide evidence that some shareholder was unable to sell their shares when they wanted to. Seeing wrong numbers online means nothing.

 

[Boomer19]

.. funnily enough I decided to 'just ask chuck' about this a couple of weeks ago, but the process is not straightforward if you want to transfer shares without incurring CGT. There is likely going to be a gap of many days where I'll be unable to trade which is just as bad as the situation I am currently in with the UK broker.

.

yes i thought about moving my acct from IB to fidelity, or at least moving a part of it.

ib and fidelity are typically #1 and 1a in the Barrons yearly brokerage rankings. and while i’m fine with IB there’s always some little annoying things.

but now i’ve seen some here give examples of their accts being inaccurate at fidelity, or not being allowed to trade their options!

so i think i’m sticking with full acct at IB for moment, since they seemed to be amongst the best at handling this properly.

but to circle back to your scenario, it’s tough. because you’re right, that transfer period could be 2-5 business days where your shares are in limbo between brokerages. plus the broker who you are transferring out from usually charges you a fee which is kinda salt in wound

 

[Singuy]

If Gali needs to liquidate 10% of his TSLA position to buy a MY, that means he is not even a Teslanaire yet... We really should start a GoFundMe campaign for the guy

The guy most likely have less than 100 pre split shares. It was 68 a year ago and it became pretty unaffordable for a good portion of this year.

 

[Green Pete]

You are just making this up. If not, provide evidence that some shareholder was unable to sell their shares when they wanted to. Seeing wrong numbers online means nothing.

Many people here have said they they themselves where unable to trade on their assets during this period.

I'll admit the conspiracy theory sounding stuff with naked shorting sounds questionable but it's also well beyond my understanding of how the markets work. And @Artful Dodger is a person on this forum I don't have confidence to place much doubt in.

 

[smorgasbord]

Here's something worrying .. I just called my UK broker ...

So TSLA is offering an extra ~9M shares, accounting for about 1% dilution. The volume in the first half hour of trading today is over 26M, with the price down about 4% (not including the over 7% up in pre-market). Let's agree this is not caused by the secondary offering.
Also, can we resume regular service?

I'm in exactly the same boat with 4/5th of my shares missing and no one will even clarify when they might arrive! Not that I want to sell anyway, but it's a poor show. Your brokers response was also telling!

Blah, I've €10k heading to my trading account, but don't think it will arrive there until tomorrow.

Why this isn't instantaneous these days is totally beyond me...

Have to say, I'm really happy with my broker, Degiro. It's supercheap and you get exactly what you pay for, which is shares and absolutely nothing else. I was so sure they'd bungle up this split, but monday afternoon/US morning, I had all the shares I were supposed to, at the price they were supposed to be.

Trivial and yet RBC, again the largest financial institution in Canada (and a Top 10 institution globally), has not done it.

I appreciate that seeing the 1s and 0s in your account does not constitute you HAVING the shares, but one would think that much the same way that the DTCC can credit an account before settlement, that such an institution would be able to do the same to their customers. The fact that IBKR Canada and Questrade have both done that, and yet the only Canadian bank with a bearish note on the stock has not, does lend some level of credibility (albeit circumstantial) to the theories being floated on this forum.

.. funnily enough I decided to 'just ask chuck' about this a couple of weeks ago, but the process is not straightforward if you want to transfer shares without incurring CGT. There is likely going to be a gap of many days where I'll be unable to trade which is just as bad as the situation I am currently in with the UK broker.

So, if we were really seeing manipulation from Naked Short Selling, would this be happening in US accounts as well? I just read a half dozen pages in this thread, and ALL the complaints are from non-US broker accounts.

So, smells more like issues with handling foreign stocks than from brazen Naked Short Selling. But, heck, I know nothing.

 

[luckyruby]

Gali needs a car loan...

If I were him, I'd borrow the cash on margin (<= 2% through M1 Finance or Interactive Brokers) to buy his Y since it's only 10% of his portfolio and pay it down over 5 years.

 

[engle]

In that case, we should all email Al Root to write more stories quoting GJ! Noticed GJ said "demand is drying up". Is that "drying up" like an oil well? He might be on big oil's payroll lol.

Here is what I just InMailed Allen Root on LinkedIn:

"Subject: Curious: Why do you quote Gordon Johnson?

Hi Al,

Thanks for your extensive coverage of TSLA I always read your articles.

Just curious why you quoted Gordon's opinion today of the cap raise. Gordon's PT of $17.40 is an outlier being the lowest on the Street. He isn't representative of analyst coverage of the name.

When I posted this to Tesla Motors Club dot com's investors' roundtable, one of the forum members replied, "... anytime GJ speaks about $TSLA...$TSLA rockets". I replied in that case, we should all email asking you to write more stories quoting him! haha

Russ

PS. I'm an individual $TSLA investor since 2011 (average $30 cost basis). I can see Tesla's Fremont Factory below my master bedroom window in Fremont. Bought Model X P90D in 2016 and now have a Model 3."

I reached out to Andrew Ross Sorkin last year about one of his NYT articles on the illegal guns after my credit card number was somehow obtained and used to order guns online and stay at a hotel near Disneyland (FBI investigated this). Andrew wrote back.

 

[Nocturnal]

Why does Dow Jones quote this moron?

From:
Tesla Is Raising Cash. This Isn't Your Typical Stock Offering. -- Barrons.com

"The offering is a little different than other stock sales. "At-the-market" means "investors who purchase shares in this offering at different times will likely pay different prices." There is no one block of stock being allocated by bookrunners.

That is a bad sign to some. GLJ analyst Gordon Johnson believes it's a sign that institutional demand is drying up for Tesla stock, and that retail investors are driving the offering. "If they need the cash, that's a problem with the story," Johnson tells Barron's.

It's a bearish take, but Johnson is indeed a bear. He rates Tesla Sell and has a mere $17.40 price target, the lowest target price on Wall Street for a stock that trades around $500. Not everyone fells as Johnson does. New Street Research analysts Pierre Ferragu is fine with the capital raise."

Let's all flood Barron's author Al Root with email:

Write to Al Root at [email protected]

Here is Al's LinkedIn:

https://www.linkedin.com/in/allen-root-b0030313/

"About

I am (was) a portfolio manager and equity analyst working on Wall St since 2001. I have passed the Series 86/87 qualification exams.

Now I work at Dow Jones writing (incisive) stories about financial markets. "

Nah, bothering him directly doesn't do anything. Respond to this sort of thing on Twitter or Facebook and @barrons. Embarrass the publication enough so that they get better writers.

 

[Unpilot]

He rates Tesla Sell and has a mere $17.40

If this is the new standard GJ unit then we should have no trouble going up several multiples a day.

Thanks GJ .......the fool that keeps on giving!

 

[Cherry Wine]

yes i thought about moving my acct from IB to fidelity, or at least moving a part of it.

ib and fidelity are typically #1 and 1a in the Barrons yearly brokerage rankings. and while i’m fine with IB there’s always some little annoying things.

but now i’ve seen some here give examples of their accts being inaccurate at fidelity, or not being allowed to trade their options!

so i think i’m sticking with full acct at IB for moment, since they seemed to be amongst the best at handling this properly.

but to circle back to your scenario, it’s tough. because you’re right, that transfer period could be 2-5 business days where your shares are in limbo between brokerages. plus the broker who you are transferring out from usually charges you a fee which is kinda salt in wound

Ironically, the meme broker Robinhood has handled this all very well.

 

[insaneoctane]

IMHO Elon and his CFO, Zach will do what they believe is best for Tesla financially, simple as that. Isn't that their responsibility?

The possible impact on the shorts should not factor into this decision.

Agree. I think Elon would love to taunt the shorts, but wouldn't do anything other than the best decision for Tesla.

 

[Chocochip]

You are just making this up. If not, provide evidence that some shareholder was unable to sell their shares when they wanted to. Seeing wrong numbers online means nothing.

Several UK-based shareholders (including myself) have reported we can’t see the extra 4 shares for each one held pre-split in our accounts, and we’ve been informed we won’t receive these shares until later this week (my broker, specifically, mentioned Friday the 3rd as the earliest we’d be provided with these extra shares).
Which means that regardless of what the stock does these days, I can only buy more or sell a maximum of 20% of my actual TSLA holding at post-split share prices until Friday at the minimum, but possibly until next week. No way around it. And we’re supposed to be fine with that.

 

[engle]

More from DJ & Co: (Barrons.com)

"Tesla converts have a junk-grade rating of single-B-plus from Standard & Poor's. Tesla bull Gary Black, the former CEO of Janus and Aegon Asset Management U.S., argues on his Twitter account that Tesla's planned $5 billion equity sale will bolster its balance sheet and lead to an upgrade of its credit rating."

I wonder if a credit rating upgrade will move the stock higher? It certainly blows a huge hole in the deranged "short" thesis!