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

[Unpilot]

Thank you for the explanation. It sounds like the Tesla equivalent of Jade Helm or the child trafficking ring under a pizza parlor

Ha Ha .....Jade Helm...that was a funny one.

 

[anon]

I'm really surprised it's not up more - not just because of the 90k guidance in the e-mail, but more that the production target for 7k/week Model 3 is now end of Q2 instead of end of the year in the most recent guidance.

 

[Highway2Heel]

Margin calls, end of month and low volume during a 4-day trading week. Those will all conspire to continue downward pressure.

If we just maintain 194ish and stay above 50% retracement for the next 8 days, that’ll be a huge help. Anything more is gravy...and the gravy would be a fairly quick bounce back to 215-221ish...that’s the next resistance it appears...

 

[Cloxxki]

Seriously? Thats like amazon shareholders ignoring AWS when it was starting out.

Will Energy make a big splash onto 2019 revenue, according to you? They're cell limited. Let's be realistic. I'm sure they could find demand for 5x or 10x the sales they achieve today if they only had product on the shelfs. It's extremely say, your own cell factory that's the biggest in the world, S/X stick to imported cells as since 2012. And then still run short on cells even with barely growing Energy deliveries in a market that's totally hot for it.
Might they have been better off simply placing orders with Panasonic for fixed volumes and sell whatever they didn't have cars or Energy products for into the market?

 

[elasalle]

Possibly, but they are deep in the money, so I’m not surprised. It happens. Hang in there!

taking profits. now that there is news that SP might rise

 

[sunny-value]

I was just assigned 2 of 3 outstanding sold puts. They were for Aug 2019 $350 and Jan 2021 $420 strike. Attempts to force margin calls?

Put sellers are taking profits. Its a sign that at least some bears may think the bottom is near. It would actually be a semi-bullish thing if it were happening across the board and not just to one person.

 

[GeckOo]

I'm really surprised it's not up more - not just because of the 90k guidance in the e-mail, but more that the production target for 7k/week Model 3 is now end of Q2 instead of end of the year in the most recent guidance.

shorts won’t believe it.there is still a month to prove it. They can find sth else to attack again.

 

[KarenRei]

I'm really surprised it's not up more - not just because of the 90k guidance in the e-mail, but more that the production target for 7k/week Model 3 is now end of Q2 instead of end of the year in the most recent guidance.

The short of it? Negative macro day & it's hard to turn a train around.

 

[Crowded Mind]

Put sellers are taking profits. Its a sign that at least some bears may think the bottom is near. It would actually be a semi-bullish thing if it were happening across the board and not just to one person.

Why not just sell the put? I know it's DITM but still throwing money away.

 

[sunny-value]

That’s interesting since they could’ve just sold the puts. I guess MM bought your puts so they don’t care about time value, just to milk retail traders

One puts go that deep in the money, there isn't much time value left, and it may actually have been optimal (after transaction costs) to assign the put and sell the shares. Some brokers don't charge of put assigning but do charge a lot more for option sales than stock sales.

 

[Cloxxki]

Other than analyst speculation, what are you referring to? Deliveries will increase this quarter.

Let's be fair, a significant part of the Q2 sales will be from Q1 demand put on a vessel too late.
With more and more price drops demand may be matched to supply more or less. But that's not a way to achieve guided profits. Needed are product adjustments that are recognizing what customers within their target group actually want in a car. Model Y is 3 years late in that respects, tow hook some 2 years. Let's see how long it will take to acknowledge the 100,000s of customers who would have preferred Model 3 were less quirky in some respects affect every second you drive.

 

[kelevra]

Finally an update from Ihor: Ihor Dusaniwsky on Twitter

 

[Hock1]

Put sellers are taking profits. Its a sign that at least some bears may think the bottom is near. It would actually be a semi-bullish thing if it were happening across the board and not just to one person.

FOLKS: Unless you are prepared to buy the underlying shares at the indicated strike price, NEVER, EVER SELL PUTS. It's a recipe for financial disaster.

 

[Tslynk67]

I have no idea where the SP will go from here, but thanks to everyone on this board who enabled me (by confirming the new Musk email) to buy more TSLA this morning at a 5% discount to the price once the main media reported it.

The hundreds of hours of time I’ve spent reading this forum just paid off.

So you're skipping some posts then...?

 

[Unpilot]

Light volume so far today/S

 

[EinSV]

What's the deal with Elon and a margin call? The guy who has billions in TSLA options is buying TSLA stock on margin? I don't get it.

Others have debunked this ridiculous theory many times just based on Elon's TSLA holdings but one useful thing Adam Jonas did on his infamous conference call yesterday was throw ice cold water all over this BS theory from a different angle.

He explained that Elon could potentially secure a loan against his SpaceX shares, which are currently worth about $16-17 billion (54% of $32B market cap). The discussion was in the context of Elon potentially taking TSLA private, but he could do the same thing if he ever was at risk of a margin call.

Jonas was throwing around numbers like a $12 billion loan as an example.

The "margin call" theory is just sheer, unadulterated BS meant to scare investors. The smarter shorts realize the problem for them is that Elon's SpaceX shares are basically an insurance policy that would prevent Tesla from ever becoming a zero. He could borrow money on his SpaceX shares to facilitate taking Tesla private, or just start buying up shares on the open market, which would drive the SP up.

That's probably one reason (along with good old fashioned character assassination), that smartish shorts like Jim Chanos are always taking potshots at SpaceX and the Boring Company, which are private companies they can't short. The deeper Elon's pockets, the more firepower he can deploy if needed. And SpaceX stock has increased about 45% per year on average, so he could have significantly more firepower in the coming years.

 

[KarenRei]

FOLKS: Unless you are prepared to buy the underlying shares at the indicated strike price, NEVER, EVER SELL PUTS. It's a recipe for financial disaster.

You can always sell put spreads. Cap the maximum loss to an amount you can afford.

That said, I'm not sure how that plays out in a scenario that puts get assigned, as I've never been there.

 

[Boomer19]

It's not just theoretically BS - it was confirmed as BS during the capital raise. It was premised on Elon having borrowed over a billion dollars, when it turns out he's only borrowed a bit over half that.

It's also premised on Elon being required (for no reason whatsoever) to borrow no more than 15% of his shares that back his loans - half the maximum. And that he can't go to a higher percentage (why? no reason at all).

It's also premised on Elon not being able to back loans with any of his private corporate holdings (such as SpaceX).

It's also premised on the notion that even if something suggesting a margin call were going to happen, that Tesla's board would prefer Musk to dump stock on the open market and hurt the SP rather than just simply... you know... raising the maximum amount of his shares that they'll let him use to back his loans.

It's also premised on the notion that Musk would rather dump shares than sell personal assets.

It's a short fantasy with no bearing in reality whatsoever.

it also ignores the fact that an option exercise is an equity-neutral transaction

 

[EVNow]

Don't forget that increased production increases margin due to amortized fixed costs of manufacturing. And that it is the last cars (sold) off the line that generate the bottom line profit.

Not that much.

Tesla, TSLA & the Investment World: the 2019 Investors' Roundtable

If we use the numbers from that post, moving from 63k to 78k production nets us $380 less in allocated fixed cost. That is good for 0.7% margin on an ASP of $52k. So, if the margin goes up from 20.3% to 21%, it makes a difference of about $50m in p&l. So, still a loss of $200M.

We are ignoring here the whole FCA payment that went into the margin in Q1. We don't expect a repeat in Q2, right ? Obviously that makes a bigger difference than this 0.7% and we get a margin of less than 20%.

 

[JohnDinger]

I hope Elon's email was reviewed by Tesla's counsel... The SEC settlement wasn't limited to Twitter, and they seem to be eager to eat Elon alive.