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

[Bobfitz1]

Even at 100k cars revenue would be less than Q3 of last year, but probably above last quarter. As it is I expect Q3 revenue to be down both sequentially and Y/Y. That's actually pretty shocking for a seasonally strong quarter, and the death cult is going to be all over it. You can also expect to see "Is Tesla's Growth Story Over?" headlines from the media. Except CleanTechnica, of course

How do you have a good estimate of Q3 revenue when the numbers released yesterday don't break down into what % are SR+, AWD and Performance? Those splits will have a significant effect on what Q3 revenue will be I'd think. Do you disagree?

 

[jerry33]

It is absolutely pointless to talk about BMW or Nissan lowering the prices of their EVs. That is actually a negative on Tesla because it would seem to indicate that EVs are not as popular as some believe.

Basically what you're saying here is that because a Yugo wasn't quite as good as other cars and had to be sold for less, the demand for other cars was less. Having an inferior product and having to reduce the price says nothing about the actual demand.

 

[T3slaOwner]

I don’t think any rational or neutral investor can genuinely be disappointed by Tesla’s solid QoQ growth in production and net orders (despite not launching orders in any major new markets in the Q).
I think today’s stock price is driven more by Trump’s new trade war with Europe.
Tesla are vulnerable to this and I think it will be very hard to build the European GF4 as quickly as the China GF3.
If Europe does put extra tariffs on Tesla, I think ramping production faster at GF3 to supply Europe from China could be the best short term solution.
With or without a European trade war though, it is definitely time for Tesla to accelerate GF4.

In this case the stock price of TSLA is purely because of what Tesla does. You can view price history graphs in many web pages and compare it to the markets. There are plenty of times when Tesla does it's own thing and plenty of times when it is just following the market if at an amplified level. The plunge last night was because they missed their numbers.

This is pretty much an issue of not managing expectations well enough which will be very clear when Q4 numbers are out. There is pretty much no way they will deliver 360,000 cars in 2019. That was an overly ambitious forecast and even with a few thousand coming out of China no one is expecting to see them hit this target.

I'm expecting them to fall short of profit in Q3 which will be another hit to the stock price. If Tesla does enough damage control by managing the end of year expectations they can avoid a big stock hit in January. Sometimes it seems like Musk has too much pride to give up on a lost cause and rides it all the way down.

 

[T3slaOwner]

The new CFO has only been in that position for like 2 quarters. And he has been giving more clarity.

I do however wish all financial statements were from him and not have Elon answer those questions on the conf call anymore

Two quarters! That must be a record in tenure!!!

 

[T3slaOwner]

The liars are always out in force. Check out this ridiculous conclusion:

View attachment 462230

Yet: According to Tesla announces record deliveries of 97,000 cars in Q3 - Electrek (context: 97,000 delivered in same quarter):
View attachment 462231
13,000 (>13% more than delivered) more demand than supply. Simple logic!

I'm confused. Who's the liar???

 

[ggies07]

I want a tour!!

 

[StealthP3D]

Man I should've been an analyst. Hardly do any research, get paid well, no liability for what I say, and on and on

I don't know about the "paid well" part.

You couldn't pay me enough to do work that dirty. I want to finish my workday feeling like I accomplished something noble or at least useful and good. Otherwise, I would need to take a long shower every day after work and I would still feel dirty and demeaned. That's why they get paid what they do. So they can still get a date or at least a hooker.

 

[Bobfitz1]

FIFY

Thanks for the fix. How long ago did they last push out the quarter they said they would be up to 7K per week?
I pray they do reach 7K by end of this year, but preferably by next month so they can produce as many 3s as they have
demand for and show a good bump up in M3 deliveries for Q4.

 

[wipster]

I agree, and I think that the constant software updates probably do as much as the minor cosmetic changes you reference to keep the cars fresh for customers. But I may be wrong - I don't actually own a Tesla so I don't know.

I agree that the S & X need to be freshened up a bit, both on the interior and exterior, but more than anything else they (and the 3) need to redesigned to utilize all of the latest innovations that Tesla has developed since they started production, such as the newer batteries (for the S/X) and Y wiring harness (for all 3), along with anything else that's been developed that we may not even know anything about yet. I'm sure that is being planned, but it takes time for those major changes to be implemented. Would be interesting to know if Tesla took advantage of a completely new factory (GF3) to utilize the wiring harness on the 3 for the Chinese market or if that is perhaps planned after production starts on the Y. That one change can speed production up considerably while reducing COGS.

I trust all of this, and perhaps more, is on the drawing board (or screen). With the Y, Pickup, and Semi coming, all of this will definitely make the next couple years very exciting!

Buckle up!

 

[KarenRei]

I agree that the S & X need to be freshened up a bit, both on the interior and exterior, but more than anything else they (and the 3) need to redesigned to utilize all of the latest innovations that Tesla has developed since they started production, such as the newer batteries (for the S/X) and Y wiring harness (for all 3), along with anything else that's been developed that we may not even know anything about yet. I'm sure that is being planned, but it takes time for those major changes to be implemented. Would be interesting to know if Tesla took advantage of a completely new factory (GF3) to utilize the wiring harness on the 3 for the Chinese market or if that is perhaps planned after production starts on the Y. That one change can speed production up considerably while reducing COGS.

I trust all of this, and perhaps more, is on the drawing board (or screen). With the Y, Pickup, and Semi coming, all of this will definitely make the next couple years very exciting!

Buckle up!

3 is the same platform as the Y. If Y gets something, 3 will get it too.

S/X are in a constant state of being updated. You never know what will come when, but don't expect some "sudden leap forward". The Raven one was a particularly large one, by Tesla's standards.

 

[Nocturnal]

I know I'm preaching to the choir but the price drop is just so frustrating. TSLA has moved past all sorts of hurdles, production, quality concerns, demand concerns, tax credit expirations. All of that is in the rear view mirror and we are seeing steady growth of sales and production with plenty of runway left. Despite all that SP is nearly as low as it was during the times where it looked like Tesla was actually on shaky ground.

Another note. Every single major communications event results in an SP drop. (if not all then most) I can't help but feel that is pure manipulation.

Texas is right up there with you. There is so much wind excess power at night, my energy provider offers free power at night (to try to modify the demand curve). Guess when I charge my Tesla.

Yeah, Kansas and Texas being leaders in Wind Energy is amazing. Just goes to show that even if you don't care or don't agree with climate issues or don't want more pollution controls, green energy is compelling on a pure profit perspective.

 

[ZeApelido]

Replace Y with 3 and you have this board in 2016. The stock will take off when it takes off. No one here knows when that'll happen.

The stock will take off when Tesla shows it can be consistently cash flow positive. Investors thought that would happen after model 3, and it hasn't yet. When Musk claimed constently profitable going forward, and then Q1 happened, that left permanent damage to the stock that will not come back until profits come back.

 

[FreqFlyer]

I agree that the S & X need to be freshened up a bit, both on the interior and exterior, but more than anything else they (and the 3) need to redesigned to utilize all of the latest innovations that Tesla has developed since they started production, such as the newer batteries (for the S/X) and Y wiring harness (for all 3), along with anything else that's been developed that we may not even know anything about yet. I'm sure that is being planned, but it takes time for those major changes to be implemented. Would be interesting to know if Tesla took advantage of a completely new factory (GF3) to utilize the wiring harness on the 3 for the Chinese market or if that is perhaps planned after production starts on the Y. That one change can speed production up considerably while reducing COGS.

I trust all of this, and perhaps more, is on the drawing board (or screen). With the Y, Pickup, and Semi coming, all of this will definitely make the next couple years very exciting!

Buckle up!

Where does Tesla spend the bulk of its precious R&D dollars? The Y will be the new volume product, Pickup and its variants (read SUV) has the makings of being the new high profit margin product easily outselling the S/X multiple times. The Semi being a transformative force for over the road trucking.

The debut of the Pickup next month is major. The next couple of years will be exciting for Tesla.

 

[Unpilot]

I know this has been posted before but I feel it is worth doing so again.
Watch this video and tell me Tesla is not going to be a extremely wise stock to buy.

I just bought some more.

Everyday Astronaut interviews Elon Musk.

 

[Doggydogworld]

How do you have a good estimate of Q3 revenue when the numbers released yesterday don't break down into what % are SR+, AWD and Performance? Those splits will have a significant effect on what Q3 revenue will be I'd think. Do you disagree?

We have a pretty good idea of SR+/AWD/P splits in Europe from sites like eu-evs.com. @Troy's surveys also provide mix and option take rate info. Surveys suffer from self-selection bias, but that doesn't change dramatically from one quarter to the next so the trendlines are pretty good. Check out the Near-future quarterly financial projections thread for spreadsheets from @luvb2b, @EVNow and others plus good discussion of the inputs to their models.

 

[FreqFlyer]

The stock will take off when Tesla shows it can be consistently cash flow positive. Investors thought that would happen after model 3, and it hasn't yet. When Musk claimed constently profitable going forward, and then Q1 happened, that left permanent damage to the stock that will not come back until profits come back.

THIS. Want to lessen the influence of FUD , shorts and TSLAQ on the SP, put together couple of descent profitable or near break even quarters. In essence become "boring" financially speaking.

The good thing for Tesla, they have some built in good news in the way of product launches along with the battery show and tell. All of that positive press means nothing if Tesla can't get its finances in order.

 

[Svetlin]

Musk has too much pride to give up on a lost cause and rides it all the way down

Of all business leaders, Musk seems to suffer the least from the sunk cost fallacy. He gave up on battery swap when it didn't make sense, gave up on the alien dreadnaught (for now), gave up on propulsive landing for Dragon v2, radically changed the design of Starship a few times, his whole basic philosophy is that every design is guaranteed to be wrong, and they are just trying to be less wrong over time.

Edit: also eventually got rid of the "work of art" second row seats that didn't fold flat. Probably forgetting a bunch more examples.

 

[Cherry Wine]

We have a pretty good idea of SR+/AWD/P splits in Europe from sites like eu-evs.com. @Troy's surveys also provide mix and option take rate info. Surveys suffer from self-selection bias, but that doesn't change dramatically from one quarter to the next so the trendlines are pretty good. Check out the Near-future quarterly financial projections thread for spreadsheets from @luvb2b, @EVNow and others plus good discussion of the inputs to their models.

What are your thoughts on what the Model Y does for the company's financials?

 

[SOULPEDL]

A spin on words from Business Insider... (maybe old, published 2 hrs ago, just got up

These 2 bullets are almost true. But I believe there is minimal Osborn Effect between the 2 classes of vehicles for the fact that I wanted to upgrade to the model X not downgrade. There was no way I could afford or justify the X nor the newer S (post 2016 AP hardware). But then we got the Model 3 and paid anyway. In my case, Tesla got every drop they could from us. But someone bonafide wants a Tesla and can afford one, they start with the really nice ones (that can tow and camp and do other cool stuff).

Aside from a poke at the shareholder having missed "Potential" profits in an alternate universe, what the competition really doesn't like is that Tesla's growing momentum leads to every person wanting one - which puts (is putting) a dent in the oil, and Auto demand. And if we were to remove the 3 from the equation, there would be no further growth. And 3 margins for ASP are likely pretty nice (hope to hear more in the ER).

Creative at least.

Tesla is killing its potential profit margins with the Model 3

• The company is selling far more lower-margin Tesla Model 3 sedans that higher-margin Model S and Model X vehicles.
• Starving the higher-profit vehicles is a bad move that limits Tesla's ability to survive a sales downturn.

 

[wipster]

3 is the same platform as the Y. If Y gets something, 3 will get it too.

S/X are in a constant state of being updated. You never know what will come when, but don't expect some "sudden leap forward". The Raven one was a particularly large one, by Tesla's standards.

I agree with you about the 3 and the Y being on the same platform, but the Y will be designed and built from day 1 with the new wiring harness while it will take a fair amount of modification for the 3 to utilize it. I'm sure that's in Tesla's plans but it's not like you can flip a switch and use it even if they're based on the same platform. I'm sure they will convert the 3 to utilize it, but it will be interesting to see how they do it.

I'm just curious to see if they had the new wiring harness in mind as they put the new factory into use in China... would seem to make sense, but what do I know? Very little after my dream Tuesday night apparently .