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

[Right_Said_Fred]

Most traditional OEMs are taking big hits, again:

GM - 4,94%
F - 6,46%
FCAU - 5,62%
VOW - 6,66%
BMW - 5,08%
DAI - 5,64%

TSLA not doing that bad at -3,19%

 

[Unpilot]

Yesterday was cool...I worked out...went to the beach...took my family out for dinner....and avoided eating a hat!

 

[M|S|M MYP]

Yesterday was cool...I worked out...went to the beach...took my family out for dinner....and avoided eating a hat!

Today's a new day..plenty of opps for hat eating! unintentional of course....unless TSLA goes to $1500 maybe?

 

[Prunesquallor]

Broke 1000. Again.

 

[StealthP3D]

How is it possible to kill something that doesn't exist?

 

[EVMeister]

Broke 1000. Again.

Oh $1000, how I missed you.

 

[mekberg]

Although they also provide 'gliders' which provide a new chassis for an old engine without pollution controls:
New-looking trucks with old, polluting engines could get a pass from Trump

The heavy truck market is very resistant to change. We should not overstate the rate of adoption for BEV, even when the economics are overwhelming. Obvious, cheap, lifesaving, fuelsaving techniques such as skirts below trailer and truck chassis are strongly resisted in the US.

Years ago there was a DOT program for truck and bus fuel economy. One of my best friends ran the program. I remember that the skirts paid for themselves within a typical two-month use, but operators resisted and refused. My friend gave the analogy of motorcycle riders who resisted using helmets.

Now think about Tesla Semi. To use that drivers much learn how to use touchscreens etc.

Given that today long-haul drivers in the US are increasingly Sikh, there may be a better outlook than before because the new generation is better educated and more adaptable. Large corporate fleets will, as they already are, experimenting. Mass adoption depends on driver acceptance, assuming FSD does not soon arrive in widespread use.

I admit it, there are serious analogies to the F-150 sized market in terms of readiness to change. Even if only 10% accept Semi that will rapidly become a major influence.

Yes. The people who resist change will be priced out of the market by people who embrace Tesla Semi.

 

[jhm]

Really people? 10 dislikes? I'm just stating facts.

Posted this morning from Bloomberg:

Tesla Approaches Milestone of World’s Most Valuable Carmaker
By
Gearoid Reidy
June 11, 2020, 1:24 AM EDT Updated on June 11, 2020, 2:42 AM EDT

With a market capitalization of more than $190 billion, Tesla still has some distance to close to reach Toyota’s $210.5 billion valuation, which includes treasury shares, according to data compiled by Bloomberg. A rally of about another 11% in Tesla shares could see it claim the crown if Toyota holds steady, with Tesla already up 23% since the beginning of June.

Toyota’s market valuation includes the 14.3% of shares that Toyota itself holds as treasury stock, worth around $30 billion. Tesla doesn’t hold any treasury shares, according to data compiled by Bloomberg.
...

This is just silly. If Toyota were to sell it's treasury shares, it would dilute its share price, which in turn would lower the $210B figure. Even to argue that they could raise enough cash with that to offset the dilution misses the fact that Toyota does pay a dividend and repurchases shares to avoid holding excess cash. So management has already signaled that they have no higher return prospects for this excess cash than to return it to shareholders. Really the value of treasury stocks is primarily that a company has returned cash to investors by taking those shares out of circulation already.

Imagine the situation whereTesla issues 20% more shares to be held in treasury. Would anyone believe that management had magically increased Tesla's market cap by 20%? The only advantage for Tesla in doing that would be to have shares at the ready to sell whenever that had need for more capital, but really it's not that hard for Tesla to issue shares anytime it wants to raise capital anyway. So holding treasury shares would not meaningfully add to Tesla's valuation.

So claiming that treasury shares added to market cap is a silly way to do valuation. But if you could buy that silliness, then I would suggest that number of shares short, should also be added to the total number of shares. Whenever a share is sold short, there is a buyer taking up an incremental share long. So the total value of all Tesla longs is about 8.7% greater than market cap. These shares created by lending do have real value. If shorts were to close their short positions, this would push the share price up by decreasing the number of shares available to trade. So counting short shares as part of market cap makes at least as much sense as counting treasury shares.

Edit. To add to this, Investopedia, Wikipedia and others define market capitalization as the share price times the number of shares outstanding. Moreover, shares outstanding are exclusive of treasury stock.

Market Capitalization.
Learn about Shares Outstanding
Understanding Market Capitalization
Market capitalization - Wikipedia

 

[Cherry Wine]

Message on RobinHood web site.

High Traffic
We are experiencing high traffic. You can still place trades, but other functionality may be impacted.

Same message every day this week.

 

[Causalien]

To lose $13bn in 6 months is quite something.

It's a while when I stop entering or continuing any discussion with them. I believe the last time was on Reddit or in the comment section of Die Welt in German. I realized its a waste of my time and energy as they did not follow any sane thought process and facts. For that reason, I can not feel any sorrow but believe everybody is it's own lucks Blacksmith *German saying.

I'm really happy with mine though ...

Who lost 13bn? Shorting tsla?

The guy got the right idea, but you can tell it's his first time shorting and he got greedy. Tsla was pretty down during the pandemic. And he wanted that extra $300 after the stock is already down by 50%. The profit window for shorting is very narrow as downsode moves are usually more pronounced and faster.

 

[mekberg]

I had some excess cash loitering in my trading account. Tried to be cute and snipe a share at $985 when it was at $988. Of course the SP immediately reversed and I ended up caving at $1,007.

reeeeeeeeeeeeee

 

[StealthP3D]

They have proven that their product gets better AFTER you purchase it. SO.... what is Nikola's sales pitch?

Nikola's sales pitch is to all those Tesla naysayers who missed the boat.

 

[marvinat0rz]

Wonder if this runup will finally flush most of the shorts for good. Barring catastrophe, it has to happen someday. The latent buying pressure from the shorts has been on my mind for years, it can't stay there forever.

 

[mekberg]

I looked at these - $178
I bought June 21 $1200s instead at $202 - now at 207

I want to make a Battery Day play but am hesitant to do so until the date is confirmed. Good luck to you sir!

 

[dl003]

Wonder if this runup will finally flush most of the shorts for good. Barring catastrophe, it has to happen someday. The latent buying pressure from the shorts has been on my mind for years, it can't stay there forever.

I swear to God if Smeagol doesn't start talking about NKLA soon I'm gonna lose it.

 

[ZeApelido]

Meh. So in another week/month/year/whatever when TSLA is $1100/$1420/$9000/whatever they’ll have a market cap of 250B/333B/1T and it just won’t matter what Toyota bought/sold/holds/whatever.

It’s silly to squabble over a few billion in marketcap when one company is positioning for world domination and the other is splattering buy our ‘amazing hybrids’ commercials all over TV. I almost bit the dust. Note to self: don’t eat cake while watching TV.

If we don't squabble over every few billion, whatever will we talk about?


Demand??

 

[ggr]

But if you buy all the Toyota stocks you get the treasury stocks as well so the value is what you can buy all the stocks for which is around $180 billion.

I think it's not so much 'dislikes' as 'don't agree'

No, it's just plain wrong. Toyota bought back stock on the open market to bolster their stock price. Now, in the US, when you do a stock buyback, the shares just disappear. Toyota, whether because Japanese law allows this or doesn't demand this, just held on to its own shares. But shares that are not on the market don't count toward market cap. They're called "treasury shares" because they are held by the company's treasury department, not because they are government bonds.

 

[Bobfitz1]

Chrome, lots more chrome.

Thanks HG Wells. I didn't know George Miller was shooting another Mad Max movie!

 

[FrankSG]

Think Nikola picked fuel cell to differentiate themselves from Tesla because they know there are zero people out there thinks they have anything on Tesla. You can't out Elon and will look like a crazy person saying how you have some secret sauce. Fuel cell however is a mystery to a lot of people.

The company is totally fake. It's the equivalent of those online money guru subscription service. Their claims have always been "I give you all the material, all you need is to execute to be a millionaire". Slow clap for Nikola using the same business plan.

Nikola is not totally fake. In essence it's a design company that's made a bunch of designs for vehicles, and a few prototypes. I can see why Trevor is proud of these, because the designs are pretty well done. However, the enormous problems are:

1. Designing the machine that makes the machines is orders of magnitude harder than designing the machine. Elon has stated this numerous times.
2. Anyone can make a great prototype, and claim certain specs and price. Being able to produce said vehicle with those specs, at that price point, and have sufficient margin for profitability, is another thing entirely. Even if Nikola (or its outsourcing partners) are able to create the production facilities, there is no guarantee that the products will have the same specs and price as the prototypes. The Tesla Roadster had to be sold for much more than originally promised.
3. Even if they manage to build out production capacity, and produce the products as promised at the quoted prices, we have absolutely no idea if any of them will sell, because the pre-orders are a joke. We don't know if any company will buy hydrogen trucks (probably not), we don't know if any people will want to buy the electric water vehicle (maybe?), and we don't know if their truck design will be able to compete with the incumbents, the CyberTruck, and the Rivian truck.
4. Nikola is spending way too many resources, and Trevor is spending way too much of his time, on things that are unimportant. Nikola World 2019, the Tesla lawsuit, the interviews with YouTube investing channels, etc. are not what Nikola should be focussed on right now. Most of its customers aren't even consumers but businesses. You don't need to advertise and increase brand awareness to sell trucks to businesses, you just need to offer a cheaper and better product.

WIth that in mind, maybe NKLA is worth a couple dozen million dollars at best. It's basically a company with ~350 designers & PR people, who create prototypes that nobody knows whether they are actually feasible, and who create hype around these prototypes. Nikola is basically a design studio with a PR department, and perhaps a handful of (probably mediocre) engineers sprinkled in.

 

[Fobble]

Mnuchin on CNBC trying to blame economic disruption on BLM "riots and looting". What a tremendous piece of garbage.

Or you are twisting his words ... Looting =/= BLM