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

[TheGrimSweeper]

There's no logic behind the stock price. I'm preparing a buy but will wait and see a bit longer. I expect it to keep dropping or at least hovering around 200 until Q2 report.

 

[Singuy]

Whether if it’s a buyout or take private, anything under the price of $420 is shady on Elon’s part as he decided to reverse course, especially when $420 was within striking distance months ago. He has publicly stated that the funding was there, VW was one of the presumed parties involved, and he turned them, along with his bankers down. With Elon stating recently that Tesla will be a $500 billion company within 5-10 years, why would he sell for anything less than $420? Especially with over $4 billion in cash to take us beyond Model Y.

Take private or buyout, it’s shady business if the price is under $420.

Going private is different than a buy out.

 

[ZeApelido]

Trying to quick rest of 401k monies transferred to self directed IRA to take advantage of this...

 

[EVNow]

A partner with a lot of money or a deal that is obviously cash flow positive.

You mean like the FCA deal ?

 

[FreqFlyer]

This. I think meeting Q2 guidance will get us back to $250+ in short order. It's that simple.

Bingo, and I bet someone has told EM to stop talking, just give Shorts more FUD to print. An easy way for Tesla to change the narrative is announce the Pick Up debut this summer. Maybe it will be done at the Shareholders meeting next month. And have some specifics as to when and where it will be built. Talk about China and have lots of pictures at the Shareholder's meeting. It will slowly start to change the narrative.

 

[Motor Mouth]

There's no logic behind the stock price. I'm preparing a buy but will wait and see a bit longer. I expect it to keep dropping or at least hovering around 200 until Q2 report.

While I suspect you are right, I decided to buy in halves. 50% at $195 today and sit on the other half for a bit to see what happens in the short term. I wouldn't be surprised if you are correct and it either stays flat or drops a bit further - at which point the other 50% goes in.

 

[MarcusMaximus]

Have ships started arriving in Europe yet this quarter? I really need to bookmark that spreadsheet...

 

[sundaymorning]

Thanks for the correct link, and now I know what you’re referring to.

You’ve misunderstood/disregarded the important context.
He was saying that taking orders online only would reduce prices—as a result of reduced expenses from closing retail stores. Not because of going to online only sales per se. And it’s not just “more” as you wrote, it’s completely online only.
Well, as you should also know by digging in a little more, just 1-2 weeks after that announcement, they’ve pretty much walked back on the entire idea. Only a single digit % of stores closed and as a result, they announced prices would go UP to offset the retail location expenses.

Not blaming you. Context is key.

I agree, I was digging around 3 different CC to try and find info on the Shanghai factory when Elon stated that he thinks Shanghai will produce 2,000 cars around end of 2019 when I stumbled upon the cost savings on Model S and X. As a result I got the dates as well as context of the info mixed up. But I can assure you that there are cost savings beyond going online. In the Q1 CC Elon also stated what @Factchecking wrote below, it might be the reason I mixed up the CC. The answer to cost savings is in the upgraded power train similar to M3 drive units. Although I doubt it’s a 5-6% savings, but it’s only one example. Since inception, Model S and X has had many price drops due to efficiencies.

Here's what I was able to find in the transcript of the Q1 call about S/X costs and prices:

Elon Musk

"Yes, I should mention that the upgraded powertrain for S and X was actually launched in a significant cost down because we essentially took the high volume, we’re driving units of the Model 3 which is extremely efficient magnet motor and product electronics and we made a version for that for the contract unit of S and X. And so, we’re actually able to get cost reduction while improving range and [indiscernible] of the car. That’s just 1 example."​

I.e. sharing part of the power train drives down S/X costs.

 

[sundaymorning]

Going private is different than a buy out.

Yes I get that, and Elon better vote “No” on his 20%. Voting yes on anything less than $420 is unacceptable when he’s turned down $420. Elon’s answer to a buyout should be similar to what he gave the Saudis when they first approached him for a $1 billion capital raise: buy on the open market. Period.

 

[mongo]

Yes I get that, and Elon better vote “No” on his 20%. Voting yes on anything less than $420 is unacceptable when he’s turned down $420. Elon’s answer to a buyout should be similar to what he gave the Saudis: buy on the open market. Period.

Not that I support a buyout, but a buyout by a public company would allow private investors (and certain funds) to stay in. That is a HUGE difference, and one of the main reasons going private didn't happen. Also, Elon did not turn down $420, he was going to offer $420 to people that wanted to (had to) cash out. Those that stayed in would not get anything other than private shares.

 

[Sparky]

Yes, they did.

From the report:

We enabled the feature and drove on several highways across Connecticut. In the process, multiple testers reported that the Tesla often changed lanes in ways that a safe human driver would not—cutting too closely in front of other cars, and passing on the right.

OT:

It does not appear to be categorically against the law to pass on the right in CT:



2005 Connecticut Code - Sec. 14-233. Passing on right.
Sec. 14-233. Passing on right. The driver of a vehicle may overtake and pass upon the right of another vehicle only when conditions permit such movement in safety and under the following conditions: (1) When the vehicle overtaken is making or has signified the intention to make a left turn; (2) when lines of vehicles traveling in the same direction in adjoining traffic lanes have come to a stop or have reduced their speed; (3) upon a one-way street free from obstructions and of sufficient width for two or more lines of moving vehicles; (4) upon a limited access highway or parkway free from obstructions with three or more lanes provided for traffic in one direction. Such movement shall not be made by driving off the pavement or main-traveled portion of the highway except where lane designations, signs, signals or markings provide for such movement.

 

[TradingInvest]

I ask myself to always follow sound investment rules, though sometimes I tend to forget my own rules. Don't get into gambling mode. Selling a lot of Puts, no matter how safe it seems, could get you into margin call at the worst time.

A few rules I follow:
1. Diversification, have at least 5 positions, preferably 10
2. Don't use margin
3. In general don't throw good money after bad, the stock that looks cheap could go lower
4. For value investment, give adequate safety margin, assume things could go wrong
5. Use trading profits or dividend to start speculative positions
6. Make plans and follow through, don't invest based on "hope"

 

[oneday]

Just picked up some shares and June 28 calls. I don’t think we can go much lower without some kind of force majeure event. Now I think we will need some news to get out of this hole. Hope it comes soon.

 

[Unpilot]

Can't seem to find this on Yahoo news front page

BMW recalls 106,000 X1 crossovers for B-pillar problems

 

[azaz]

need China to resolve, stock needs to get out of this danger zone or after Q2 earnings could see 15X

 

[anthonyj]

need China to resolve, stock needs to get out of this danger zone or after Q2 earnings could see 15X

Could see that Friday if Elon sends an email

 

[azaz]

Could see that Friday if Elon sends an email

lol, S/X price cut and throwing in free supercharging coupled with minimal Raven deliveries so far got me concerned Q2 gonna be a miss too.

 

[Boomer19]

Morgan Stanley (Adam Jonas) call with institutional clients:
https://www.dropbox.com/s/p4xy3002jfup74v/TSLA-Morgan Stanley call-5-22-19.MP3?dl=0

burning cash
nobody cares about the model Y (because tesla didn’t give much detail)
no strategic buy-in

by their garnered feedback, said was one-sided, they’ve gone from a growth story to a distressed credit and restructuring story

demand is the “first domino”
also have cost and debt problem,
but demand fell 1/3 from q4 to q1

couldn’t be worse time to depend on china for demand vaccum - (jonas says they raised the question of national security for tesla cars and technology in china)

sounds like the foundation of his bear case assumption is on 300k vehicles next year?

also, strategically, if it got to that point, nobody wants to buy a company and take on the liability that it’s electric cars may kill a pedestrian, run into a building, and there’s a lot of stored up energy in electric cars (fires!!!) - the roads aren’t a safe place, and auto industry has a dark side (where regulation is behind and unable to regulate such a fancy thing like tesla - akin to analysts just don’t know how value tesla. there’s just no way to value it! is it a car company? a tech company?...
sound familiar?)

even mentioned elon’s interest in SpaceX isn’t relevant to bailing out tesla (scty bailout nod)

MSt trader then comes on and explains the trading history (uh, yeah, you’re one of the ones slamming it around). as if one hand doesn’t wash the other.

the problem is - market rules.
we’re the ones living in bizarro world, unfortunately. the street doesn’t want tesla to succeed. they just want to bleed the pig.

they’ll tell you 1500 reasons the stock sucks, meanwhile they’re swallowing 100,000 lots whole to subsequently push it up.

bunch of so-so questions and silly answers (oh, and model x doors need re-engineering - jonas)

oh and tesla has best in class brand awareness (literally laughed out loud)

maybe not all of it was misinformation. but these guys are completely full of sugar

they slammed it. didn’t even talk about bull case. completely lopsided from the public note he wrote yesterday. slimy

i listened while trying to work. encourage you to listen yourself. maybe your take isn’t as foul as mine - def interested on hearing who will punch holes in the thesis)

 

[FreqFlyer]

GF3 opens up much needed breathing room for Tesla. Its been stated GF3 is for ASEAN market consumption but I bet it also includes Europe ( who forsaw model Y possibly being built at Freemont, things change). GF3 will help even out the peaks of cars going to Europe. The profit margin should be larger on cars coming from China to Europe. And its all about margins per unit now, why else the uproar about sales of S and X.

 

[TheMrX]

Anybody selling right now is insane. At some point, someone with a lot of money (im thinking billions) is going to just snap and buy a *sugar*-ton of TSLA and its going to go bananas. Could be Larry Ellison Could be Sergey/Lartry. Could be saudis or someone similar. This is a stupid bargain at this price.
I remind you that Uber, which has no tech to speak of, no path to profitability, and serious competition is valued dramatically higher right now. Thats literally insane.

Could be a big part explaination of this low price : tech pockets rotating to lyft and Uber. Elon was probably aware of this and then we got investor autonomy day.

I didn't follow Lyft or Uber but it could be interesting to see if there is a correlation between spike of sell in TSLA versus spikes of buys in Uber/Lyft.

Of course this is on top of the bad Q1 and all...

Another thing that investor probably correlated is the price cut and cut cost in Q1 and the result we got versus the at the moment lack of Raven deliveries correlated with Elon's cost cut this quarter. If you do a cause/effect association it does not signal a good Q2.

I personnally think that this correlatio might be real because of regulatory problem with Raven that might transform Q2 from "ok" results to "bad" (but better than Q1) results.

The good thing is that Elon explained that in Q1, they almost had zero deliveries in January and did half of their deliveries in March (I'm on mobile so please indulge that lack of quote). So an OK Q1 can still be in the bag. By "OK" quarter I mean Q1 sales, but add 8000-10000 S/X deliveries and remove all one time expenses.

An OK quarter might get us some big bulls (slowly) aboard and stabilize the share price. Then we could return oscillating 300-400 in Q3 if small profit.


Worst case we get bad Q2 (neg 300-400 millions) and macro gets bad and, never thought Iwould think that 2 months ago, we might get to aroundd 100$ a share or even bellow because nothing will support the share price.

But that won't prevent Q3 to be shiny and we could (finaly!) See the famous short burn of the century.