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

[StarFoxisDown!]

Let's say by Q4, everything is going to great and according to plan at Tesla(Giga 3 is up and operational, they hit their gross margin target on Model 3 including Short Range, and they're generating more and more FCF on a quarterly basis yet the stock is still priced at 300/share or lower...……….I would actually be ok with Tesla starting a buyback program. Ideally it would be combined with insider's announcing a plan to increase their stakes as well.

I know, I know...….it's almost always better for a company that is growing to use cash on their growth. But if Wall st is so irrational that they would actually value Tesla at 50 billion by Q4, then Tesla would be able to start buying back their shares at one of the biggest discounts in wall st history. I'm not saying Tesla should use a lot of money to do the buyback but the float of available shares on the market for Tesla is pretty low. This is like giving Amazon the option to buy back stock right now at like $400/share. I think if you gave Amazon that option, they would maybe start a small buy back program. Thoughts?

 

[aznt1217]

Enjoy the sale day

- The CR report is completely and totally overblown. We're going back to when they pulled recommendation for Model S again
- The refund thing is an absolute joke. Too many unsophisticated customers out there (my friends included). Literally one went to the Tesla store and asked for a refund only to find that it was already issued via credit card. Some people who sat and cancelled 2 years later need to wait for a check or use a debit card (which a lot of people don't use). The absurdities of that CNBC article are unreal
- Nothing Material has changed. Cars are still being delivered. Almost every car if not all are already sold that are shipping to Asia and Europe.
- In the US, it's not like Tesla stopped doing business. It's not like any of us stopped driving our cars (which are fantastic btw)

For those who are panicking. Don't Panic. We're in a luill period where we're waiting for a catalyst. The sentiment is just truly horrible in the public realm right now in regards to the stock. The gap between reality is so large right now it's insane.

 

[TradingInvest]

Also the lack of owner authentication is concerning: does this mean that for the price of about 250 CR subscriptions, which is 250x $55 = $13,700, one can knock off 1.5 billion dollars from the market cap of a publicly traded company?

Another question is CR's recommendation priorities: by unrecommending the Model 3 they are basically telling their subscribers to buy less satisfying and less safe cars.

I.e. even if the Model 3 feedback from the July-September 2018 time frame is accurate, CR is recommending subscribers to buy cars in 2019 that can get them killed due to lower safety because of complaints over ... panel gaps and paint flecks?

This new editorial logic of CR is IMHO deeply irresponsible and borderline criminal.

The fake responses in CR survey is a major problem I guess even Tesla doesn't realize it. I have personal experience to show CR doesn't/can't authenticate the replies. If I were an ICE car dealer, or a TSLA short, of course I would pretend I own a Tesla, which had tons of issues.

This problem is not too significant for most products, but for Tesla, it's significant and can get worse because more and more shorts, paid bashers, car dealers, legacy car makers, oil/coal interest, will learn the trick. This problem will continue to damage Tesla's reputation until Tesla realize and do something about it. I'm not saying Tesla cars don't have issues, I'm saying those fake responses can easily mess up the results and change public perception about the brand.

What Tesla should do is to conduct their own survey through emails and publish the real results, and work diligently to address the issues. Hoping CR and other websites to address the authentication issue will lead to nowhere.

 

[K_Dizzle]

Is there anyway to check how often CR has not recommended the car with the highest satisfaction score? Maybe going back to the year 2000?

 

[adaptabl]

Why are you here on TMC? Can you disappear and take your shorty trolls with you?

I want Tesla to improve and succeed. I think they have the best technology in an EV at this time but are not that great at producing consistent quality products with good customer support. Those who refuse to acknowledge any problems are not helping Tesla improve. Are they better than a year ago? For sure. Do they have more work to do? For sure.

This change from Consumer Reports is a reflection of this. Recently even some of the largest Tesla fans published information on the poor service experiences.

 

[Joe F]

Honestly though I can imagine that some less technical buyers might be confused at the lack of an ignition key or a start/stop button if they did not receive enough information from their delivery specialist. It drives me crazy in my wife's Volt that I have to move the shifter to park instead of just hitting the off button. I'm sure some people just aren't ready to give up those old-world conventions. (Not having owned a Tesla, I wouldn't be able to tell anyone how I turn it off, and ironically enough I've done a test drive in a Model X a year ago. It was all a blur.)

Quote from the hit piece:

"When they drove the car back to their office, they couldn't turn it off. It sat running in their driveway for hours before Indu Chhabra drove it back to the Tesla store.

Tesla offered a loaner while they serviced the car, but the Chhabras found the issues with it so alarming, they asked to return it and swap it for a fresh one."

One would think that anyone at Tesla would have instructed the new owners how the car worked, not offered a loaner while they serviced their new M3 that had nothing wrong with it.

 

[Wnuk]

Yesterday and today, TSLA seems to have found solid support at $300. See if it holds.

That didn't age well at all......

Sorry, my bad

 

[CorneliusXX]

New Electrek article about Tesla's efficiency and range lead over competitors, via efficiency testing conducted by a third party:

'Tesla’s incredible efficiency lead is becoming clear with range test against Audi e-tron and Jaguar I-Pace'
​

That Chart is incredibly disappointing. If ever there was a chart which should start at nought the distance traveled by vehicles should be it. It's great that Tesla is better by poor that the benefit is exaggerated

 

[RobStark]

That the Model 3 is the most loved car by CR subscribers is a simple fact.

That CR 'unrecommends' the Model 3, based on problems whose "vast majority" Tesla says are already fixed, and which car owners are the most satisfied with despite teething problems of a brand new product, is breathtakingly bad logic by CR that should be called out...

CR is consistent.

They remove recommendations for cars with below average reliability.

And they never take an OEMs word that problems are fixed.

It needs to show up in the data. Tesla said Model X FWD reliability was fixed years ago and FWD still show up in CR data as a problem.

On another note, not FC post, but I find it odd those that dispute the validity of CR's method assert Model 3 is the most loved/highest satisfaction car based on CR's data.

I have watched Big Three go from 90% market share to 45% market share as Big Three executives and their fans bash CR and insist there are no problems.
I hope Tesla does not follow in that tradition.

 

[Papafox]

Remember the nearly $100 million in options that billionaire Stanley Druckenmiller bet against TSLA? These options expire tomorrow, Feb 22. It doesn't take much imagination to figure out what information Druckenmiller used to justify this bet.

 

[RobStark]

Does CR list the number of M3 owners who responded to their surveys? All I see is "locked" where those numbers might be disclosed.

Sure there are problems, with all cars, but if only 10 people replied to their Tesla M3 survey, that would put the report into a new realm of FUD.

CR has been doing this a long time. If they don't have a statistically significant sample they say so. Not every new car sold in America gets a reliability rating.

 

[K_Dizzle]

Remember the nearly $100 million in options that billionaire Stanley Druckenmiller bet against TSLA? These options expire tomorrow, Feb 22. It doesn't take much imagination to figure out what information Druckenmiller used to justify this bet.

View attachment 379390

So is stock price manipulation just an open secret?

 

[AlMc]

Enjoy the sale day

- The CR report is completely and totally overblown. We're going back to when they pulled recommendation for Model S again
- The refund thing is an absolute joke. Too many unsophisticated customers out there (my friends included). Literally one went to the Tesla store and asked for a refund only to find that it was already issued via credit card. Some people who sat and cancelled 2 years later need to wait for a check or use a debit card (which a lot of people don't use). The absurdities of that CNBC article are unreal
- Nothing Material has changed. Cars are still being delivered. Almost every car if not all are already sold that are shipping to Asia and Europe.
- In the US, it's not like Tesla stopped doing business. It's not like any of us stopped driving our cars (which are fantastic btw)

For those who are panicking. Don't Panic. We're in a luill period where we're waiting for a catalyst. The sentiment is just truly horrible in the public realm right now in regards to the stock. The gap between reality is so large right now it's insane.

Nice to see a TSLA veteran back!

 

[humbaba]

Nice! /me starts digging in the couch cushions. C'mon, gotta find me some dry powder!

woohoo! Found some dry powder. Now to start lining up the buy orders. @tivoboy was expecting $270 or so in the not so distant future, so that will factor in. Thinking cap on.

 

[RobStark]

Also the lack of owner authentication is concerning:

It is a survey not an interrogation.

And Tesla prevents JD Power from accessing Tesla owner's DMV records in California and other States that require OEM consent.

If Tesla did we would have JD Power and Strategic Vision numbers to verify.

Tesla will likely say they want to protect Tesla owner privacy but more likely they don't want these numbers published until they are consistently good.

 

[erha]

Regarding refunds for reservations: I know somebody who cancelled their reservation two weeks ago in Norway (liked the car but the timing didn't work out). The money arrived in a week. And it arrived on a monday, so the weekend probably delayed it a bit. That is nearly as fast as it is even possible to do an international wire transfer.

 

[Cherry Wine]

Pure speculation: but I think it clear that a sizeable group (no idea what percentage) of folks are still convinced that Tesla is reliant on the share price for payback of the March convertibles -- so any drop in stock price could be amplified right now, seen as not just a negative in its own right, but for also making the "needed" share price for conversion as that much more elusive.

Just look at the article @Papafox just posted as quoted below. Whether the author is willfully ignorant of Tesla's repeated admissions that they are paying the debt off with cash or not, this indicates to me that people mistakenly believe that the share price, on its own, with regard to the March 1st deadline somehow plays a role in Tesla's continued solvency. If a subset of investors believe this to be true, I think it credible to believe they would bail on the stock in the event of any downturn that makes reaching the $360 conversion target seem very unlikely.

Anyway, just throwing thoughts out there.

Tesla has $920 million in convertible debt coming due on March 1, which is expected to put pressure on the company, which has previously struggled to maintain a positive cash flow.

Convertible issues give bondholders the right to trade their debt for equity after shares rise over a certain price. Tesla shares are currently more than $50 below the $359.87 conversion price after closing on Thursday at $303.77.

 

[TNEVol]

Lol they chose the period of July to Sept 2018!? The specifically targeted that time period because they knew that's when the initial ramp was happening and would likely have the most issues. I'm sure they were paid behind the scenes to conduct the survey during that time period. They knew if they did it from Oct to Dec 2018, the results would have been much different.

I completely disagree with the CR survey results because their instrument is inappropriate for the Tesla product
It is fixated on comparisons with the dealer system, other models, no OTA updates etc. In effect it compares a car that is complete and gets worse from delivery to one which gets better. The concept of beta and update is totally alien
I have been unable to answer these surveys and others because the questions want you to compare rear vision via the mirror when I use the rear camera

That being said there is a complete misunderstanding of the survey and the process. It comes out addressed to all subscribers at the same time and reviews all listed products from vacuums to cars at the same time. CR is a publication of the Consumers Union which is a nonprofit scientific based organization. It buys all its products for testing and accepts no advertising or endorsement
When comparing like items I have found it to be incredibly accurate. The problem here is CR has nothing appropriate for comparison to the Tesla car or purchase and in my opinion wrongfully attempts to compare it to a old line car and system. A good example was on one survey, not CR, which asked if everything on the car worked fully. Well I bought FSD and EAP neither of which worked fully but I knew that and expect much improvement in the future but the answers do not envision that response
I use CR regularly on buying other items and if I ever buy another ICE pickup, I will use it to compare Ford Chevy and others but i will not use it to compare against Tesla

 

[Papafox]

So is stock price manipulation just an open secret?

A few months ago, members of this community sent scores (probably hundreds), of manipulation concerns to the SEC and I haven't heard of a single one that has been acted upon. When Cramer was speaking loudly that Musk had nothing to worry about with the SEC going after his "funding secured" comment in a timely fashion, and with tons of shorts jumping on the SEC about Musk's statement, that afront to the SEC's illusion of adequacy in securities oversight necessitated a response (whether right or wrong). None of the alleged manipulations by shorts and others betting against Tesla get much press, and so the SEC sweeps them under the rug. The agency lacks the personnel to do an adequate job of policing the markets and rather than rolling up their sleeves and making an example out of the few most flagrant violations with the most shorted stock in the markets, the SEC has mostly sat on their hands and continued to pursue their usual subjects, such as those guilty of ponzi schemes.

 

[KarenRei]

What confirmation do you need? It's going to be paid off in cash. Too unlikely that any bond holder would want to convert with the stock price being what it was/is.

Pure speculation: but I think it clear that a sizeable group (no idea what percentage) of folks are still convinced that Tesla is reliant on the share price for payback of the March convertibles -- so any drop in stock price could be amplified right now, seen as not just a negative in its own right, but for also making the "needed" share price for conversion as that much more elusive.

Indeed. Shortsville is still packed with people talking about Tesla's imminent need for a capital raise due to the convertibles.

I've also run into quite a few people over the past months in various contexts who have said that they want to wait out the convertible payoff before jumping into the stock.

That Chart is incredibly disappointing. If ever there was a chart which should start at nought the distance traveled by vehicles should be it. It's great that Tesla is better by poor that the benefit is exaggerated

What I am continuously frustrated at is how many car reviewers just take the car for a spin and talk about performance, handling, comfort.... but completely ignore comparative ranges and charge speeds. It's like, okay, if you only want a city car, fine, but most people actually want to be able to go a significant distance in real-world conditions, recharge quickly, and keep going. This latter aspect almost never gets reviewed. I don't know if reviewers just assume that it's the same for all EVs, or that EV drivers never go on road trips, or what.... but it's a huge problem.

It's not enough to just take the car for a spin around the block. Reviewers need to get this through their heads. Go on a half-day road trip in the car before you write up your review.