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

[wipster]

B just buys any old share and returns it to A. He doesn't have to return the specific share he received from A. So it wouldn't impact D's, or anyone else's short position directly.

Of course it can be more insidious. A loans share to B, B sells it to A, A loans it to B, B sells it to A, lather, rinse, repeat.

My head hurts...

 

[StealthP3D]

Elon's new concerns were actually new. It was the first time he talked about cash flow +, from this point forward vs GAAP+.

That's not true. Some time ago Musk said it made sense to pour profits back into the business. And that's a no-brainer anyway, given their business model, he shouldn't have to tell us that.

 

[MarcusMaximus]

B just buys any old share and returns it to A. He doesn't have to return the specific share he received from A. So it wouldn't impact D's, or anyone else's short position directly.

Of course it can be more insidious. A loans share to B, B sells it to A, A loans it to B, B sells it to A, lather, rinse, repeat.

In that latter scenario, consider what happens if A recalls all their shares.

 

[StealthP3D]

I'm a little surprised at the negative mood here today. It's normal for rallies to be followed by profit taking/selling. A little consolidation is a good thing. To put things in perspective, we had a very nice run up from the $170's and now it's trading where it was trading on Monday afternoon.

 

[Nocturnal]

I am certainly looking forward to the Roadster 2.0 being out on the streets. Talk about a halo effect.

The level of whining and excuses from the hardcore ICE crowd is insane. I've heard many times that it doesn't matter if an EV is fast, because it's just an RC car or golf cart. Those idiots forget that the point of performance cars is speed, not how they are powered. I suppose that's the old issue of fanboys vs enthusiasts. Enthusiasts will appreciate any quality product in their hobby, a fanboy has to tell himself that the item he doesn't own is garbage.

Not to go too far off topic but Progressive Dems are listening, and getting elected, and not taking PAC money. Further discussion can be had in the politics thread if desired.

OT, I am seeing some positive movement there.

I'm a little surprised at the negative mood here today. It's normal for rallies to be followed by profit taking/selling. A little consolidation is a good thing. To put things in perspective, we had a very nice run up from the $170's and now it's trading where it was trading on Monday afternoon.

Heck, the dip from the autonomy investor's day happened DURING the presentation. I'm feeling great myself. The media is still reporting that Wall Street is "mixed" on whether or not there will be solid deliveries this quarter. End of Q2 will force the others to change their tune.

 

[Singuy]

That's not true. Some time ago Musk said it made sense to pour profits back into the business. And that's a no-brainer anyway, given their business model, he shouldn't have to tell us that.

Except last ER call he guided GAAP+ for q3 and q 4..and expect cash flow + for q2.

 

[Doggydogworld]

Not so much that. A's share gets loaned to B, who sells it to C. But now C's share can get loaned to D, who sells it to E.

Yes.

But now think about what happens when B wants to cover...

Nothing. B buys a share on the open market and repays it to A. That part of the transaction is closed. D still owes a share to C.

The issue comes when A sells the share he lent out. He effectively (through his broker) tells B to return the share. B (via his broker) must now locate someone else willing to lend him a share. If he can't, he must buy in the open market or else his broker will do it (aka buy-in).

Shorting GM's worthless old stock post-BK was free money if you could hold the position. Free money attracts a crowd, though, so it became nigh-impossible to hold the position. Some I knew.were getting partially bought in every day and the negative short rebate got as high as 130% if I recall.​

 

[mongo]

I'm a little surprised at the negative mood here today. It's normal for rallies to be followed by profit taking/selling. A little consolidation is a good thing. To put things in perspective, we had a very nice run up from the $170's and now it's trading where it was trading on Monday afternoon.

I'd gladly sell on Tuesday, the stock I hold today.

-Blimpy

 

[StealthP3D]

Except last ER call he guided GAAP+ for q3 and q 4..and expect cash flow + for q2.

I was just pointing out this was not new information like you claimed. It was during the last Investor Conference when he said it made sense to pour profits back into the business. It was not new information.

Don't expect a dividend for at least 7 years.

 

[RobStark]

The main thing that advertising would do would be to let them raise prices (for a constant number of sales), and thus margins, to offset the advertising costs. But this runs counter to Tesla's goal of lowering prices, so...

I agree with the Tesla team. I don't want to see it now.

Advertising would allow Tesla to increase ASP without raising prices.

And added income would far outpace small advertising budget.

Elon has a goal to be less stupid over time. I wish he would get less stupid with regards to advertising over time.

Still, Tesla is the least stupid of the automakers. By a wide margin.

 

[Singuy]

I was just pointing out this was not new information like you claimed. It was during the last Investor Conference when he made the remarks I was referring to. It was not new information.

Well musk say a lot of things in the past. You can find "this is not new" just cherry picking what he said in the past. You can't just write off what he said just a month ago with "well he said this 2 years ago".

He guided GAAP+ from q3 2018 forward.
Then he guided GAAP+ only q3 and q4 of this year. Now he is saying forget gaap+, it's hard so we are just focusing on cash flow +. So yes, what he said yesterday was totally new info.

 

[Larry]

Not to go too far off topic but Progressive Dems are listening, and getting elected, and not taking PAC money. Further discussion can be had in the politics thread if desired.

At least for now. The political arena and its realities chew up the bright eyes of most politicians unfortunately. Maybe I’m just old and seen too much but I wouldn’t get my hopes up

 

[StealthP3D]

Well musk say a lot of things in the past. You can find "this is not new" just cherry picking what he said in the past. You can't just write off what he said off just a a month ago with "well he said this 2 years ago".

He guided GAAP+ from q3 2018 forward.
Then he guided GAAP+ only q3 and q4 of this year. Now he is saying forget gaap+, it's hard so we are just focusing on cash flow +. So yes, what he said yesterday was totally new info.

No, the Autonomy Investor Conference was more recent than anything he projected during the last earnings conference call. I'm not "cherry picking" old info. It's more recent than what you're referring to.

 

[Remus]

Well musk say a lot of things in the past. You can find "this is not new" just cherry picking what he said in the past. You can't just write off what he said off just a a month ago with "well he said this 2 years ago".

He guided GAAP+ from q3 2018 forward.
Then he guided GAAP+ only q3 and q4 of this year. Now he is saying forget gaap+, it's hard so we are just focusing on cash flow +. So yes, what he said yesterday was totally new info.

If the market is convinced about the gaap+ would the stock price be like it is today??

The post you reply to talking about the SP drop after the conference. The main narrative from the short is no demand. And you simply brushed that off.

 

[EVNow]

That's exactly what the shorties were hoping for with their MMD.

The problem is, it wasn't an MMD. Its the same buy on rumor sell on news we 've been seeing all year long. Atleast this time we didn't have an overnight $20 drop, like we had after Y reveal.

 

[dc_h]

India is not going to be a large opportunity. Incomes are still quite low and import taxes are punitive for foreign built cars. Also having experienced traffic there I would not want to drive a nice car. Lanes and traffic rules are optional. 2 lane streets have traffic packed 5 lanes wide mixed with 2 wheelers trying to sneak through every free space. Autopilot is useless in that environment. Lots of people drive very small, cheap Indian made cars that lack even airbags. I’d imagine cheap low range EV equivalents of those or EV bikes are the opportunities in India. Both are way below the price point Tesla plays at.

India’s middle class is 300 million people. Not all Tesla level middle class, but I work with Indians in Delhi who are bmw owners who spend hours in traffic. Delhi and Hyderabad could support significant sales.

think that reconfirming record deliveries in reach (but not certain!) So close to the end of the Q is a very good sign. However his comments on profitability vs profit should cool expectations on getting back to black. Break even would be nice though.

bugger profits, GAAP or not. Free cash flow could result in 10 billion in cash equivalents in 18 months without a profit. The big win from surprise profits would be S&P inclusion and a short squeeze. But long term, 5+ years down the road, focusing on free cash flow and Mac growth is all that should matter. Tesla could be making 5 million cars in 5 or 6 years and that would also mean competition would have merged down to 3 to 5 global competitors.
Assuming Tesla makes a good truck, Ford could become a division of VW or a controlled partner. GM sadly has little to show for 30 years of EV research and will partner with SAIC and a Chinese consortium. Toyota will Kairatsu with the rest of Japan and Kia/Hyundai will hook up with Samsung to survive. That leaves BYD and some dark horse combining with BMW or Mercedes.

Ted Turner had great insight into media consolidation in the 1990’s that occurred over the following 20 years. EV and FSD will lead to similar or greater industry co-optation. Three years from now there’ll be a new landscape and I hope to see a Tesla organization generating cash flow and expanding while the rest or cutting dividends and merging to maintain scale and consolidate R&D and SGA.

PS: Don’t forget to say hi to jimmy the clown at CNBC on twitter.

 

[Singuy]

No, the Autonomy Investor Conference was more recent than anything he projected during the last earnings conference call. I'm not "cherry picking" old info. It's more recent than what you're referring to.

You sure he was referring to current out look? I thought he was referring to when FSD is a thing, Tesla will begin focus on building a ride sharing fleet while maintaining break even, and then realize the revenue later. I didn't think he was referring to this year.

 

[Mike Smith]

Yet another Ford recall - looks like they're the ones with the 'whompy wheels'.

Ford recalling 1.2 million Explorers over suspension issue - CNN

Edit: Yikes! It's actually four separate recalls for separate issues!

 

[KSilver2000]

I've heard many times that it doesn't matter if an EV is fast, because it's just an RC car or golf cart. Those idiots forget that the point of performance cars is speed, not how they are powered.

Point of performance is not just speed or how the car is powered. I don’t know if speed was the only thing that those “idiots” mentioned. All car enthusiasts know speed, motor, brakes, suspension, weight, and much more are all equal factors of a cars performance measurement.

Given that, if I had the means, I’d take a McLaren over my PDL any day.

 

[azaz]

Advertising would allow Tesla to increase ASP without raising prices.

And added income would far outpace small advertising budget.

Elon has a goal to be less stupid over time. I wish he would get less stupid with regards to advertising over time.

Still, Tesla is the least stupid of the automakers. By a wide margin.

At its core advertising is about increasing the customer base and there are documented ways to advertise that are cash positive.