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

[Pezpunk]

“The children now love luxury; they have bad manners, contempt for authority; they show disrespect for elders and love chatter in place of exercise. Children are now tyrants, not the servants of their households. They no longer rise when elders enter the room. They contradict their parents, chatter before company, gobble up dainties at the table, cross their legs, and tyrannize their teachers.”

― Socrates 469-399 BC

yes, obsolete old farts have been railing against their rising replacements since the dawn of time.

 

[dgodfrey]

Let's take a typical Porsche car shopper as an example. They go into the Porsche dealer and take a test drive. What about the Porsche test drive would make that 15% say, "I'd rather buy a Tesla"? If they really thought that, they probably weren't a Porsche buyer to begin with.

Lack of competing autopilot/FSD software? Lack of supercharger network? They should have known that already before stepping into the Porsche dealer. Very, very few will cross shop an $80,000 Tesla with a $110,000-plus Porsche.

That kinda makes sense and you get that a lot on the Porsche forum about the Porsche mystique that no other car can duplicate. So for existing Porsche owners, only the purists IMO will be able to justify a Taycan over a Model S based on their learned appreciation of all things Porsche. However, there are a large number of Porsche owners that still hold value as a worthy justification to spend that kind of money. I believe they will find it's not a large enough difference between say a M3P and the Taycan and enough left over to buy a ludicrous Model S for the girlfriend.
So for the new Porsche buyer, I can definitely see them cross shopping the two and going with the Model S, 4 out of 5 times. We shall see how the numbers play out.

 

[Pezpunk]

That kinda makes sense and you get that a lot on the Porsche forum about the Porsche mystique that no other car can duplicate. So for existing Porsche owners, only the purists IMO will be able to justify a Taycan over a Model S based on their learned appreciation of all things Porsche. However, there are a large number of Porsche owners that still hold value as a worthy justification to spend that kind of money. I believe they will find it's not a large enough difference between say a M3P and the Taycan and enough left over to buy a ludicrous Model S for the girlfriend.
So for the new Porsche buyer, I can definitely see them cross shopping the two and going with the Model S, 4 out of 5 times. We shall see how the numbers play out.

the problem is there's so much embedded hatred of Tesla's touchscreens, and "fit and finish problems", from people who have never even used one or been in one for that matter. It's unlikely they'll go out of their way to seek one out to test drive.

 

[Nocturnal]

Porsche releases new cheaper Taycan. Stock drops on fears of lower margins, clear sine of lack of demand, cannibalization of existing models.

Oh wait, that only happens to TSLA.

 

[mongo]

the problem is there's so much embedded hatred of Tesla's touchscreens, and "fit and finish problems", from people who have never even used one or been in one for that matter. It's unlikely they'll go out of their way to seek one out to test drive.

However, their friends with Teslas will.

 

[M3Rider]

How about now?

First, I never pretended to be an Oracle.
I don't remember this post, but if it was 6 month earlier, smth like Apr then it seems the SP was higher than now, so it was in fact true that you could buy cheaper 6 months later. What exactly are you questioning?

Many people here have an opinion that there's a good chance SP might walk back some after the ER. So, the truth is nobody knows right now what's going to happen in the very near future.

Some are waiting for the imminent breakout, but nobody will be so bold as to put a date on it.

By breakout I mean more than $260 obviously.
My ASP is $350; I've added some, but unfortunately that's peanuts compared to when my new car first hand experience coincided with the take private statement and I was under the impression I won't have much time to invest into TSLA.

 

[PeterJA]

Tesla relies on defections for 100% of their growth.

No. Young folks enter the car-buying market for the first time every day. These folks are internet-savvy, appreciate innovation, and reportedly love Tesla.

If Porsche and the other carmakers could prevent all defections Tesla would die.

When Porsche and other carmakers fail to prevent young folks from choosing Tesla (cars or robotaxi rides), they will die. Old folks are leaving the car-buying market every day.

 

[Thumper]

Now that the volume is down, will manipulation begin?

 

[jerry33]

That kinda makes sense and you get that a lot on the Porsche forum about the Porsche mystique that no other car can duplicate.

I dunno. Tesla seems to be doing a pretty good job on the mystique front--at least with actual owners.

 

[MFranc123]

Hi, I'm a "short" (a student with only peanuts I can afford to lose at stake, a very small fraction of the position size most of you likely have).

I come in peace! I'd like to have respectful conversations, ask questions about the current bull line of thinking, and provide answers about the current bear line of thinking if anyone would like to know. I hope that's OK.

More specifically, I had one question in mind about revenues. Since deliveries are up YoY, do bulls generally expect revenue also to be up? I've seen some chatter and modeling suggesting revenues to be around $6.5B, which would be below 2018 Q3. I have no idea if this is going to be correct or not; just offering what I'm reading on my feed. Any thoughs on whether this is possible, expected, or unlikely would be appreciated.

 

[dgodfrey]

the problem is there's so much embedded hatred of Tesla's touchscreens, and "fit and finish problems", from people who have never even used one or been in one for that matter. It's unlikely they'll go out of their way to seek one out to test drive.

Unfortunately you are probably correct. I remember this being a common complaint with Bolt owners before the Model 3 hit it's stride. They were so certain that every feature on the Model 3 that was different than anything they've ever used before was going to be the end of civilization. They couldn't even conceive of looking to the side to see how fast they were going, much less grasp that the wipers could be controlled from the stalk if you wanted to override the auto setting.

It was a bizarre justification that I presume was their way of convincing themselves that buying a traditional, boring, mediocre, hatchback clone was the correct decision. They are still at it.

But...... for those curious to see what the fuss is about, if they are honest with themselves, will usually see why the Model 3 is worthy of all the accolades, awards and attention. That holds true for every current ICEV owner of which we've only exposed the tip of the iceberg. I really believe that the momentum is unstoppable at this point. It's almost a blessing in disguise with all the FUD that has made the common man aware of the company Tesla. What starts out as someone starting the conversation with me about some negative headline they read, knowing that I drive a Tesla, turns into an opportunity to educate them to "the rest of the story". Those that are reachable are intrigued and eventually start to come around. I know this from experience and from some very skeptical friends. It's a truly compelling car that not only saved the company but preserved it's fate. We live in a special time in history to be a part of this story.

 

[sparcs]

Since deliveries are up YoY, do bulls generally expect revenue also to be up? I've seen some chatter and modeling suggesting revenues to be around $6.5B, which would be below 2018 Q3. I have no idea if this is going to be correct or not; just offering what I'm reading on my feed. Any thoughs on whether this is possible, expected, or unlikely would be appreciated.

There was some discussion a few days ago. Read a few pages before and after this post: Tesla, TSLA & the Investment World: the 2019 Investors' Roundtable

 

[anthonyj]

Hi, I'm a "short" (a student with only peanuts I can afford to lose at stake, a very small fraction of the position size most of you likely have).

I come in peace! I'd like to have respectful conversations, ask questions about the current bull line of thinking, and provide answers about the current bear line of thinking if anyone would like to know. I hope that's OK.

More specifically, I had one question in mind about revenues. Since deliveries are up YoY, do bulls generally expect revenue also to be up? I've seen some chatter and modeling suggesting revenues to be around $6.5B, which would be below 2018 Q3. I have no idea if this is going to be correct or not; just offering what I'm reading on my feed. Any thoughs on whether this is possible, expected, or unlikely would be appreciated.

Going short into Q3 earnings might be a great trade for the reason you state. Weaklings might panic sell off of headlines. However, revenue will continue to grow after with GF3 and Model Y

 

[MFranc123]

There was some discussion a few days ago. Read a few pages before and after this post: Tesla, TSLA & the Investment World: the 2019 Investors' Roundtable

Thanks!

Going short into Q3 earnings might be a great trade for the reason you state. Weaklings might panic sell off of headlines. However, revenue will continue to grow after with GF3 and Model Y

Interesting! I'd actually think the opposite. Since the revenue decline might be baked in the price, it might take an exceedingly big revenue miss to significantly move the price. Makes me think about getting less short into earnings.

 

[Right_Said_Fred]

Hi, I'm a "short" (a student with only peanuts I can afford to lose at stake, a very small fraction of the position size most of you likely have).

I come in peace! I'd like to have respectful conversations, ask questions about the current bull line of thinking, and provide answers about the current bear line of thinking if anyone would like to know. I hope that's OK.

More specifically, I had one question in mind about revenues. Since deliveries are up YoY, do bulls generally expect revenue also to be up? I've seen some chatter and modeling suggesting revenues to be around $6.5B, which would be below 2018 Q3. I have no idea if this is going to be correct or not; just offering what I'm reading on my feed. Any thoughs on whether this is possible, expected, or unlikely would be appreciated.

The shorts you consult have moved the goal posts to ‘lower revenues’, now that sales keep going up. It is one of the last straws they hang onto. But sales and margins are what matters to investors now. And from mid 2020 revenues will start going up again too, really fast.

As a moderator: you are welcome for civilized discussion - which you say is your intent - but please show an open mind. If you cannot have an open mind, this is not the place for you.

 

[mongo]

Hi, I'm a "short" (a student with only peanuts I can afford to lose at stake, a very small fraction of the position size most of you likely have).

I hope you realize that a short position via stock has unlimited liability (theoretically, your broker will force you out well before infinity). A bear position via puts is bounded though.

 

[M3Rider]

Hi, I'm a "short" (a student with only peanuts I can afford to lose at stake, a very small fraction of the position size most of you likely have).

Are you short as in day trader or based on the fundamentals?

Most people here are bulls based on long term vision an will not help you with the short term trades.

If you truly believe that Tesla is doomed based on revenue fall compared to the Q3 18 when only top-optioned cars were sold and after the prices fell by over the phased out tax credit amount, you are not seeing the big picture, which is these price drops are what is reinforcing the fate of ICE. The more the prices drop, the sooner this fate will come.

 

[AlexS]

Hi, I'm a "short" (a student with only peanuts I can afford to lose at stake, a very small fraction of the position size most of you likely have).

I come in peace! I'd like to have respectful conversations, ask questions about the current bull line of thinking, and provide answers about the current bear line of thinking if anyone would like to know. I hope that's OK.

More specifically, I had one question in mind about revenues. Since deliveries are up YoY, do bulls generally expect revenue also to be up? I've seen some chatter and modeling suggesting revenues to be around $6.5B, which would be below 2018 Q3. I have no idea if this is going to be correct or not; just offering what I'm reading on my feed. Any thoughs on whether this is possible, expected, or unlikely would be appreciated.

So you are from Italy. If in Italy it is still warm enough to wear short shorts you are OK, because while shorting Tesla you can lose your pants.

 

[Pezpunk]

Hi, I'm a "short" (a student with only peanuts I can afford to lose at stake, a very small fraction of the position size most of you likely have).

I come in peace! I'd like to have respectful conversations, ask questions about the current bull line of thinking, and provide answers about the current bear line of thinking if anyone would like to know. I hope that's OK.

More specifically, I had one question in mind about revenues. Since deliveries are up YoY, do bulls generally expect revenue also to be up? I've seen some chatter and modeling suggesting revenues to be around $6.5B, which would be below 2018 Q3. I have no idea if this is going to be correct or not; just offering what I'm reading on my feed. Any thoughs on whether this is possible, expected, or unlikely would be appreciated.

Revenue should be in the $6 - $6.5 billion range. Q3 Revenue will be lower year over year than 2018 because Q3 2018 in particular was exceptional -- they delivered an insane ratio of P3D cars. For the full year, though, 2019 revenue will still blow away 2018 revenue.

They will probably only just barely reach the lower bound of their oft-repeated guidance of 360k-400k deliveries this year, but this is a company that in the aggregate is growing steeply and steadily in sales and revenue, while its (ICE) competitors falter and erode.

Focusing on tiny slices of the bigger picture, such as one quarter's YoY revenue, is missing the much more important bigger picture of sales and revenue increasing by ~50% every year, and the new China gigafactory coming online any minute now.

To zoom back in -- I don't think anyone's expecting a profit, or revenue to exceed Q3 2018, but I'm thrilled with the direction of the company overall. The 97,000 deliveries for Q3 was a new record, and exceeded all expectations at the start of the quarter. Elon's email unfortunately recalibrated expectations too high, frustratingly allowing for the "miss" narrative to form after what was in reality a record quarter for them. Wall Street had been talking about 85k deliveries as the target just a few weeks prior. But then 97k was suddenly disappointing. Whatever.

 

[Curt Renz]

Hi, I'm a "short" (a student with only peanuts I can afford to lose at stake, a very small fraction of the position size most of you likely have).

I come in peace! I'd like to have respectful conversations, ask questions about the current bull line of thinking, and provide answers about the current bear line of thinking if anyone would like to know. I hope that's OK.

More specifically, I had one question in mind about revenues. Since deliveries are up YoY, do bulls generally expect revenue also to be up? I've seen some chatter and modeling suggesting revenues to be around $6.5B, which would be below 2018 Q3. I have no idea if this is going to be correct or not; just offering what I'm reading on my feed. Any thoughs on whether this is possible, expected, or unlikely would be appreciated.

Welcome to TMC. Playing TSLA based on upcoming quarterly reports is essentially just gambling no matter whether long or short. With an innovative young growth company intent on disrupting long established industries, a prudent investor really should consider only the long term potential.

I first wrote a similar post here in early 2013. I was chastised by one of the regulars for being a newbie attempting to advise long-time TMC members. That regular later apologized; we became friends after sharing a pleasant phone conversation.