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

[CHGolferJim]

There was a recent NPR program/podcast that I caught part of, about whether advertising actually works or not. I think it was Freakonomics. They mentioned the famous saying "I'm sure that 50% of our advertising budget is wasted; I just don't know which half." 50% of zero is...

Heard that for the first time 35 years ago in corporate product management “school”.

 

[Artful Dodger]

Are you suggesting the Public Relations Society of America has a PR problem they need to deal with?

"The best PaRt is no PaRt".
-- Elon Musk

 

[ABCTG]

Time for a new poll?
I thought it's helpful to gather what the current expectation of the folks paying special attention to this catalyst is for the Share Price (SP) in the next 2 weeks. What everyone thinks SP can get to with >=80% chances.

TSLA S&P SP Prediction - Conducted Dec-12th weekend

Tagging a few folks that are quickly crossing my mind.
@All, I request you to join.
This information will likely be helpful for many (of course myself). Among other things with not getting carried away with unrealistic views and loosing money on crazy short term bets, and/or having upset week(s).

@adiggs @Artful Dodger @BlackS @Bet TSLA @FrankSG @ @generalenthu @ggr @juanmedina @lafrisbee @Lycanthrope @Papafox @Right_Said_Fred @Singuy @StarFoxisDown! @StealthP3D @TheTalkingMule @Tim S @Tyler34 @vikings123

I put in my estimates, which were mostly flat, since I have (yes, most likely misplaced) faith that the big buyers have planned for this S&P event by use of hedging or agreements with large stockholders-dark pools etc.

My estimate for the next few months in the new year after that is at $1,000+

2 main reasons for the $1,000 stock price are;

1) FSD. I myself who is a TSLA stockholder, owns a Tesla Model 3, and have paid for FSD, still cannot believe that FSD is a possibility. On city streets, there are so many obstacles and curveballs, that I wonder how can a machine navigate through that?
Why buy FSD if I don't think it's a possibility? Because we are in a time of major disruption, and I know that major change is possible. Just 30 years ago, the sole communication option for the masses was a telephone landline, and u were cool if u had a second line for a fax machine, and a pager on your hip.

I always believed that SpaceX could reuse rockets, (which a lot of people didn't believe was possible), but my brain will have to see FSD to believe it, which I think is how it will be for the general public, and once they see FSD, then the TSLA stock price will go up.

2) The pace of improvement/change at Tesla.
Sandy Munro said when he worked at Ford, the rate of improvement was at best 2-3 years, or never. When he talked about the octovalve in the Tesla he was blown away, by so many departments that would have to work together at a traditional automaker, that it would never happen. And then he went back to the octovalve a few months later it already had a number of additional improvements, he said that would NEVER happen at a traditional automaker. Sandy says Tesla improves close to the speed of thought, and that is something that may happen at a software company, but is a big deal in manufacturing.



In my mind Tesla is still a growth company, and it's stock can still be volatile.
Growth stocks can go from $50 to a $100 in less than a week, or $600 to $1,000.
TSLA can easily soon get to a Market Cap of $1trillion.
It wasn't that long ago that it was big news that AMZN, MSFT and AAPL were approaching $1T, and now AAPL is at $2T, AMZN at $1.5T, and MSFT at $1.6T, and nobody even mentions it.

 

[ggr]

No, I don't want to sell covered calls when the stock is volatile. Unless of course you want your shares to be called away. And then have to buy back in at a higher price. I have the experience on this my way and your way. Your way guarantees you lose more often. This is not speculation, it is just simple math. The math that you collect premium when your sell is executed and if the stock doesn't go up past the strike + the premium you keep your shares and your premium. If it does you keep the premium but you lose your shares.

During the flat period, I sold covered weekly calls and kept accumulating cash and bought more shares. Then one day the stock turned up and all my shares got called away. If you want to lose often, sell weekly covered calls into a rising bull market. My way is low risk. Also, my philosophy is not driven because I'm in love with Tesla and believe it can never fail. I recognize that even the #1 investment opportunity today, my be a dog in the future. Implied Volatility is just a guessing game. I really don't want to rely on guessing. I look for catalysts in the fundamentals rather than look into a crystal ball. What I did has worked for me. Everyone has their game so if yours is working that's fine.

Buying Calls when the stock is on a run up can be a winner too. But I don't keep enough cash to make that bet. Usually when I sell to collect a profit I have some other stock I want to buy as it is in a pull back. I admit this is probably not the best strategy for big gains, but I have less stress that way. At my age I play it much safer.

Here's my simple way to look at it. Selling covered calls is a mildly bearish outlook. If you are bullish on Tesla, and you're right, you will lose on those options.

 

[CLK350]

I put in my estimates, which were mostly flat, since I have (yes, most likely misplaced) faith that the big buyers have planned for this S&P event by use of hedging or agreements with large stockholders-dark pools etc.

My estimate for the next few months in the new year after that is at $1,000+

2 main reasons for the $1,000 stock price are;

1) FSD. I myself who is a TSLA stockholder, owns a Tesla Model 3, and have paid for FSD, still cannot believe that FSD is a possibility. On city streets, there are so many obstacles and curveballs, that I wonder how can a machine navigate through that?
Why buy FSD if I don't think it's a possibility? Because we are in a time of major disruption, and I know that major change is possible. Just 30 years ago, the sole communication option for the masses was a telephone landline, and u were cool if u had a second line for a fax machine, and a pager on your hip.

I always believed that SpaceX could reuse rockets, (which a lot of people didn't believe was possible), but my brain will have to see FSD to believe it, which I think is how it will be for the general public, and once they see FSD, then the TSLA stock price will go up.

2) The pace of improvement/change at Tesla.
Sandy Munro said when he worked at Ford, the rate of improvement was at best 2-3 years, or never. When he talked about the octovalve in the Tesla he was blown away, by so many departments that would have to work together at a traditional automaker, that it would never happen. And then he went back to the octovalve a few months later it already had a number of additional improvements, he said that would NEVER happen at a traditional automaker. Sandy says Tesla improves close to the speed of thought, and that is something that may happen at a software company, but is a big deal in manufacturing.



In my mind Tesla is still a growth company, and it's stock can still be volatile.
Growth stocks can go from $50 to a $100 in less than a week, or $600 to $1,000.
TSLA can easily soon get to a Market Cap of $1trillion.
It wasn't that long ago that it was big news that AMZN, MSFT and AAPL were approaching $1T, and now AAPL is at $2T, AMZN at $1.5T, and MSFT at $1.6T, and nobody even mentions it.

Agreed 110% - add to this

1 - the runaway US Fed printing press/ inflation getting closer and closer to hyperinflation LA style: where can you park your USD that are losing value at an accelerating rate? Real estate, PM (precious metals), BTC, .. and stocks, yes stocks that now Central banks are buying

2 - the irrationality of the market - imagine, if Trevor M can raise $B's on hype alone, once TSLA is in the S&P 500 how many people may suddenly "wake up". For many the big argument against Tesla or TSLA was it not being there, or that there weren't enough charging stations to make it practical.

All in all I'm more inclined to believe there will be a huge volatility in the coming weeks - despite the nagging real possibility that the hedge funds et al have prepared for this and are ready to cap it - or are they just ready to capitalize on *any* SP volatility around the S&P inclusion?

For grins this is what a friend of mine relayed - the comments of her broker when she asked him to buy some TSLA (I generally give up on discussing TSLA to newbies, except once in a while to gauge public perception):

" ..Regarding Tesla, I’ve never bought into it, so you know whence I speak.

No doubt Musk is a genius, but the valuation has always been a problem, and it’s worse now that it’s going into the S & P 500.

There have also been major corporate governance issues which remain obstacles (which S & P’s inclusion seems to ignore).

Institutional and public interest is very high and is propelling the shares to even higher valuation.

In short, it’s more than fully valued.

HOWEVER, because electric vehicles are likely to be widely adopted over the next ten years (in my opinion), I have been buying preferred shares of Porsche for the following reasons:

1. Largest shareholder in holding company that owns Volkswagen, Audi, Porsche, other badges, including 2 largest European truck manufacturers and Ducati motorcycles;
2. As largest shareholder, has dividend preference rights over all other share classes.
3. Cheap valuation, the result of the punishing VW emission measurement scandals from two years back (still recovering);
4. VW aims to be all electric in cars in 5 years, trucks in 10 years.
5. Huge dealer network, supply lines and production facilities on 5 continents, including 2 in China with more on the way.
6. Favorable European and Asian consumer and manufacturing incentives to encourage mass development.
7. A story not widely known or appreciated as yet.

If you don’t believe Electric Vehicles and battery improvements are in the future, this idea will not work. .. "

 

[22522]

Will Elon Musk's move to Texas affect Tesla brand? - CNN Video | 4 hrs ago

It is worth mentioning.
A lot of expensive vehicles are written off as small business expense.

Texas will likely end up with more than California. And he mentioned small trees.

Elon's pitch communicates "I am smarter than the average bear" and "I root for and believe in the small business."

That helps stock price and sales to entrepreneurs.

There is probably a truck coming that can work a little better for a small business than the cyber truck. That vehicle is perhaps too distracting from the messaging a small business needs to project - or thinks they need to project. But I have been wrong on styling before.

They need to design one in Texas.

 

[Lessmog]

For grins this is what a friend of mine relayed - the comments of her broker when she asked him to buy some TSLA (I generally give up on discussing TSLA to newbies, except once in a while to gauge public perception):

Well, I hope you are a better friend than her broker seems to be!

 

[M|S|M MYP]

Time for a new poll?
I thought it's helpful to gather what the current expectation of the folks paying special attention to this catalyst is for the Share Price (SP) in the next 2 weeks. What everyone thinks SP can get to with >=80% chances.

TSLA S&P SP Prediction - Conducted Dec-12th weekend

Tagging a few folks that are quickly crossing my mind.
@All, I request you to join.
This information will likely be helpful for many (of course myself). Among other things with not getting carried away with unrealistic views and loosing money on crazy short term bets, and/or having upset week(s).

@adiggs @Artful Dodger @BlackS @Bet TSLA @FrankSG @ @generalenthu @ggr @juanmedina @lafrisbee @Lycanthrope @Papafox @Right_Said_Fred @Singuy @StarFoxisDown! @StealthP3D @TheTalkingMule @Tim S @Tyler34 @vikings123

Appreciate the mention....honestly, i think anyone trying to predict the SP is just throwing darts (like myself ) Could a squeeze happen? definitely....will the SP rise next week? Probably. The only thing that puts a little fear in me is that "EVERYONE" saw this coming when it was announced, and when "EVERYONE" knows something, it normally does not end well.

 

[PeterJA]

Excellent! But here's my dilemma:
The strategy above doesn't address age of the investor. As many mature investors claim your age can and should influence your portfolio balance. Disclosure- I'm in my mid 70's. Have achieved enough to live my lifestyle until age 125 with no market crashes and flat to 5% growth. My portfolio is diversified with Tesla this year being at 50%. but 30% of all assets.

What's the point in high risk if I don't NEED the money? IMO, that is what young people should do because they have the years to make it back when they lose.

So with Tesla, I believe the future is not guaranteed as many here do. I see at least two ways Tesla will fail.
1. The economy collapses due to natural disaster or political errors causing huge ( much greater than the pandemic) loss of employment that harms sales of Tesla cars. If Tesla has a couple quarters of terrible sales due to a deep depression, then the long devotees will HODL until the company is bankrupt.
2. Elon Musk leaves the company because he has new interests, or dies. And, his replacement is like a Steve Balmer was at Microsoft when Bill Gates left. A failure! Tesla needs to do what Steve Jobs did, train a bright replacement who will be a better leader than he was. I don't see Elon doing this yet.
3. Is there another? Maybe Chinese Communist government taking control of GF3 operation and kicking Tesla out or just confiscating the profits. Europe too?

So therefore, I will take my profits off the table as Tesla grows. Keep it below 50% of my portfolio of 25 stocks with those sales. The cash gained will be in my tax exempt account or at least in my tax deferred account. Here I will invest in Gold. Gold metal and hide it physically and off the books. But physical assets to enjoy life, including travel. Love your environment and toys, not your numbers on your balance sheet.

As I said, young people here probably won't understand this mindset until they get older and wiser. But even the young, really smart people need to avoid falling in love with Tesla and the stock because you'll grow much more over the long haul if you never have a high risk go bad.

A few additions to what others have replied:

1) Covid provided a test case for how Tesla will fare in recessions. In Q2 this year, US auto sales collapsed for every make and model except Tesla.
Seeing Red: U.S. Auto Sales, Q2 2020 - The Truth About Cars

Also, a depression that destroys all auto sales would be a boon for robotaxis priced at cents per mile. Elon said he expects robotaxis next year, and the FSD beta makes that plausible to me.

2) Elon has trained his entire company to succeed without him. The corporate culture I mentioned includes incentives for innovation and trying things without fear of failure. That culture will not disappear instantly if he does.

(minute 17:50)

If Elon dies, the stock will tank because most people don't understand this, and I will sell everything else to buy more and ride it back up. I doubt that yes-men like Ballmer would last a week at Tesla. Elon danced in Shanghai, but not like this.

 

[JustMe]

Appreciate the mention....honestly, i think anyone trying to predict the SP is just throwing darts (like myself ) Could a squeeze happen? definitely....will the SP rise next week? Probably. The only thing that puts a little fear in me is that "EVERYONE" saw this coming when it was announced, and when "EVERYONE" knows something, it normally does not end well.

Hmm . . I did not know that

 

[bkp_duke]

Will Elon Musk's move to Texas affect Tesla brand? - CNN Video | 4 hrs ago

Typical CNN tripe. The point out (correctly) the Republicans drive a lot of trucks, but when they photoshop in those same drivers in front of Tesla vehicles, they completely omit the Cybertruck.

It's not quite a Tesla hit job, but you can tell who butters their bread in the back office (big oil and ICE autos).

My take, Tesla is expanding their brand appeal with the Cybertruck, and people that buy S3XY will still gravitate to that brand. Those that want a "Big Powerful Truck" will find appeal in the Cybertruck, and some of them will take that plunge.

 

[StarFoxisDown!]

Agreed 110% - add to this


HOWEVER, because electric vehicles are likely to be widely adopted over the next ten years (in my opinion), I have been buying preferred shares of Porsche for the following reasons:

1. Largest shareholder in holding company that owns Volkswagen, Audi, Porsche, other badges, including 2 largest European truck manufacturers and Ducati motorcycles;
2. As largest shareholder, has dividend preference rights over all other share classes.
3. Cheap valuation, the result of the punishing VW emission measurement scandals from two years back (still recovering);
4. VW aims to be all electric in cars in 5 years, trucks in 10 years.
5. Huge dealer network, supply lines and production facilities on 5 continents, including 2 in China with more on the way.
6. Favorable European and Asian consumer and manufacturing incentives to encourage mass development.
7. A story not widely known or appreciated as yet.

If you don’t believe Electric Vehicles and battery improvements are in the future, this idea will not work. .. "

Doesn't Porsche have more Taycan's sitting on used car lots in the UK right now than the Model 3?....despite the Model 3 haven already been out there for a couple years and exponentially sold already more vehicles.

I wish your friend would inform this guy of reality (and to do some obvious due diligence)

 

[M|S|M MYP]

Hmm . . I did not know that

Then....i have some swamp land that you will definitely be interested in buying

 

[vikings123]

Time for a new poll?
I thought it's helpful to gather what the current expectation of the folks paying special attention to this catalyst is for the Share Price (SP) in the next 2 weeks. What everyone thinks SP can get to with >=80% chances.

TSLA S&P SP Prediction - Conducted Dec-12th weekend

Tagging a few folks that are quickly crossing my mind.
@All, I request you to join.
This information will likely be helpful for many (of course myself). Among other things with not getting carried away with unrealistic views and loosing money on crazy short term bets, and/or having upset week(s).

@adiggs @Artful Dodger @BlackS @Bet TSLA @FrankSG @ @generalenthu @ggr @juanmedina @lafrisbee @Lycanthrope @Papafox @Right_Said_Fred @Singuy @StarFoxisDown! @StealthP3D @TheTalkingMule @Tim S @Tyler34 @vikings123

I honestly want to see what happens on Mon/Tue of next week. Right now I don’t have a great conviction.

I agree with Frank that people should be OK to lose whatever they are betting in the short term, no emotions, very similar to how you place a bet in poker or manage your bankroll.

Here’s a random thought: We know MMs like citadel have owned more than 5% of TSLA. What is stopping them from running the price up next week, spike IV, sell lots of call options and then dump all of their shares to S&P at a pre negotiated price on Sep18th? You get a great price on your shares and you kill all the options for the week of Dec 24th. I haven’t thought this through yet but would love for someone to poke holes in this theory.

 

[JusRelax]

Is anyone else bummed we haven't seen a new beta build in 2 weeks now? I was enjoying seeing the progress each release. Three possibilities come to mind:
1. They consider the current beta good enough for a wider release and are preparing it for the masses with the xmas update.
2. They don't consider it good enough to expand but think they need more data than they were getting with 1 week builds.
3. They finally gave the autopilot team some much deserved pto.

Fingers crossed for #1

You'll have to forgive the Tesla AP team... they took a little longer on this one, but the new beta FSD software is released and there are multiple confirmed reports of downloading the update within the past 2 hours... we'll see how much of an improvement it is!

 

[Curt Renz]

EV - today:

 

[hobbes]

Time for a new poll?
I thought it's helpful to gather what the current expectation of the folks paying special attention to this catalyst is for the Share Price (SP) in the next 2 weeks. What everyone thinks SP can get to with >=80% chances.

TSLA S&P SP Prediction - Conducted Dec-12th weekend

Tagging a few folks that are quickly crossing my mind.
@All, I request you to join.
This information will likely be helpful for many (of course myself). Among other things with not getting carried away with unrealistic views and loosing money on crazy short term bets, and/or having upset week(s).

@adiggs @Artful Dodger @BlackS @Bet TSLA @FrankSG @ @generalenthu @ggr @juanmedina @lafrisbee @Lycanthrope @Papafox @Right_Said_Fred @Singuy @StarFoxisDown! @StealthP3D @TheTalkingMule @Tim S @Tyler34 @vikings123

Quick spreadsheet calculation of conviction-weighted averages gives $752/$853 for the two weeks´ highs.
And before anyone asks - I did not make my entry after calculating this .

 

[cusetownusa]

Doesn't Porsche have more Taycan's sitting on used car lots in the UK right now than the Model 3?....despite the Model 3 haven already been out there for a couple years and exponentially sold already more vehicles.

I wish your friend would inform this guy of reality (and to do some obvious due diligence)

I agree...

My experience, at least with the brokers I know, nice guys with some of them being my friends...not much due diligence or deep thought is put into making stock buy/sell decisions. At first, I was somewhat surprised about this, but quickly realized that they are really just salesmen.

obviously I am just generalizing based on my experience, I am sure there are some brokers that do deep dive into a company before recommending a buy/sell.

The wealth of knowledge I have gained from here and places like Tesla Daily are orders of magnitude greater than anything I would have obtained from any of the brokers I know.

 

[JustSaying]

Needs flowchart. Small one on decision to HODL, larger for how to tap out credit country by country

A few additions to what others have replied:

1) Covid provided a test case for how Tesla will fare in recessions. In Q2 this year, US auto sales collapsed for every make and model except Tesla.
Seeing Red: U.S. Auto Sales, Q2 2020 - The Truth About Cars

Also, a depression that destroys all auto sales would be a boon for robotaxis priced at cents per mile. Elon said he expects robotaxis next year, and the FSD beta makes that plausible to me.

2) Elon has trained his entire company to succeed without him. The corporate culture I mentioned includes incentives for innovation and trying things without fear of failure. That culture will not disappear instantly if he does.

(minute 17:50)

If Elon dies, the stock will tank because most people don't understand this, and I will sell everything else to buy more and ride it back up. I doubt that yes-men like Ballmer would last a week at Tesla. Elon danced in Shanghai, but not like this.

What finally happen to the Walt Disney Productions" company after Walt died? O never mind...

 

[JBRR]

*TESLA MODELS S, X PRODUCTION TO SHUT DOWN FOR 18 DAYS: CNBC

Tesla tells employees Model S and X production will shut down for 18 days