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

[Krugerrand]

Now you did it. There's going to be a pissed cat err @Krugerrand once she wakes up.

Nope, I’m good. Got my mountain, while everyone was looking in the island direction. Already have my general contractor and I start building next spring. Going to try and beat Giga Texas build.

 

[Artful Dodger]

After-action Report: Tue, Dec 22, 2020: (Full Day's Trading)

Headline: "TSLA Trading Turns Technical"

Traded: $32,774,839,379.04 ($32.78B)
Volume: 51,860,980
VWAP: $631.97

Close: $640.34 / VWAP: 101.39%
TSLA closed ABOVE today's Avg SP
TSLA MaxPain (7:00 A.M.): $620 (from $600 on Mon)

TSLA S&P 500 Weight: 1.582351%
Mkt Cap: TSLA / TM $606.979B / $210.716B = 288.01%
Note: Yahoo Finance yet to update TSLA Mkt Cap re shares issued Dec 11 (SEC Filing)
​

CEO Comp. Status: (est'd Mkt Cap including Dec 11 shares)

TSLA 30-day Closing Avg Market Cap: $580.65 B
TSLA 6-mth Closing Avg Market Cap: $387.63B

Mkt Cap req'd for 7th tranche ($400B) tracking Mon, Jan 11, 2021
Nota Bene: Operational milestones are req'd for this tranche. Paging: @The Accountant
​

'Short' Report:

FINRA Volume / Total NASDAQ Vol = 53.7% (53rd Percentile rank FINRA Reporting)
FINRA Short / Total Volume = 58.0% (55th Percentile rank Shorting)
FINRA Short Exempt ratio was 0.54% of Short Volume (47th Percentile Rank Exempt)​

Comment: "Technical support at Mid-BB ($614.94); Bounce to 10-Day Moving Avg ($637.85)"

QOTD: @NicoV "Personally I found the possibility of an infinity squeeze realistic."

View all Lodger's After-Action Reports

Cheers!

 

[Bet TSLA]

Instead of endless AAPL dribble, let’s discuss something much more interesting: Expiring Jan 15, 2021 monthly options. Has anyone else looked at the $190 max pain and the huge number of calls below $200? What will the MMs do? This is not your normal weekly max pain manipulation. Thoughts experts? @Bet TSLA @Right_Said_Fred @Papafox

I don't think any of that stuff is very interesting. TA is crap, max pain is nonsense. Nobody is manipulating anything to any meaningful degree. The stock will go up because the business is growing. Short term timing is mostly gambling (which I do all the time because I like gambling).

There's my wisdom for you.

 

[FrankSG]

Nice to see @FrankSG get some love from Chicken Genius

Going to have coffee with him next week

My real-estate agent in Singapore also happens to be a huge Tesla fan, and has ~90% of his portfolio in Tesla. And Singapore is usually number 4 on highest traffic countries on my blog, after US, Canada, UK.

Lots of people love Tesla here. The store should do well once it opens, hopefully in 2021.

 

[Paul_SF]

Going to have coffee with him next week

My real-estate agent in Singapore also happens to be a huge Tesla fan, and has ~90% of his portfolio in Tesla. And Singapore is usually number 4 on highest traffic countries on my blog, after US, Canada, UK.

Lots of people love Tesla here. The store should do well once it opens, hopefully in 2021.

You guys should make a video!

 

[Bet TSLA]

You need to factor in that for most of the time they have bene operating on a very limited budget, juggling a not of different priorities with ambitious delivery dates. Also that building the cars and getting FSD working have been the priority.

I don't have to factor in any of their many excuses. They're all true, but it doesn't change that their software is at best mediocre.

Great software plays into Tesla's core strengths, attention to detail, product vision and continuous improvement.
But first it needs to be a priority.

Agreed. If Elon doesn't care, it doesn't happen.

As with cars, number one position might be taken by Apple, but below that there is plenty of market share available.

Tesla is about where Apple was in around 2001, in terms of the mechanics of software. They are way, way behind state of the art except perhaps in AI stuff. I don't know about that, other than that they seem to have put together a specific internal application that more or less works and can be improved. But it does have only one customer, which makes life much, much easier. And that customer isn't paying.

Specially the opportunity is a pre-installed Linux environment that is easy for a causal user to learn, but retains the full power of Linux.

Well, they've done a truly awful job so far with the Linux they've provided. Remember how unusable the browser was for anything? Maybe it still is. I don't know because I don't use it. Updates were horribly slow and out of date. As the MCU1 to MCU2 upgrade has shown, the whole notion of dealing with a heterogeneous platform environment is beyond them, at least in terms of QA and delivering anything usable. In general, the situation is pretty much that Tesla hasn't even been trying.

Anyway, my point stands that we really don't want Tesla shipping anything that depends on them producing and maintaining superior software. They have not yet demonstrated that they are up to the task. Adequate and "better than automotive standard" they can do just fine. Usually.

When they decide to care, then they'll do better.

 

[StealthP3D]

Yes, seriously. Outside this bubble of opinions, there exist real benefits to S&P inclusion:

• many more mutual funds are now able to buy TSLA due to their rules
• Tesla's quarterly interest expense goes down as it's credit rating goes up
• FED bond-buying inches closer with approaching 'investment grade' status
• Tesla is in the 'Bigs' now; that affects the buying decisions of the public
• Tesla doesn't have a PR department; instead headlines tout their successes

I don't deny that S&P inclusion is beneficial to the company or shareholders. It is. I'm not in a bubble, my opinion comes from observation of Elon and what he holds in high esteem.

Elon didn't spend more than 2 minutes on this before he went back to business. But it's important for a leader to recognize the accomplishments of his team, which he did.

Obviously, Elon was recognizing the hard work of his team - that is not in question. I believe he was recognizing their much more recent achievements, not that the Standard & Poor committee finally got off their butts and included Tesla in an Index they became eligible for many months ago. He simply doesn't care about stock market index committees, credit rating agencies and wealth, he cares about bringing clean renewable energy and transportation to the masses.

That's why I think Elon was celebrating more recent accomplishments of his employees and not the fact that S&P belatedly recognized the milestone that Tesla achieved many moons ago. I take this as very bullish for production and delivery numbers due to be released in about 10 short days.

 

[Thekiwi]

All the cries of manipulation and "buying dips" while the stock is still trading in the $600s is crazy talk. Tesla is currently valued at ~$600 Billion (over $725 Billion once you account for all the approved options/RSUs). We are trading at $3,200 pre split level.

It is going to take literally years of perfect execution for Tesla to grow into its current valuation. I am fine hanging on to my common stock for a long time and waiting for that day to occur and for further growth to come, but there is no way I am going to be levering up with options at anywhere close to this level. (Back under $400 a share - if it ever went there - I might start considering getting back into options.)

Feel free to disagree with this post - I know many will - but it feels like there are people on here who would still be saying "buy buy buy" even if the stock was trading at a $2 trillion valuation tomorrow. Some of you are losing your grip on a realistic valuation.

(starts digging a foxhole)

 

[StarFoxisDown!]

All the cries of manipulation and "buying dips" while the stock is still trading in the $600s is crazy talk. Tesla is currently valued at ~$600 Billion (over $725 Billion once you account for all the approved options/RSUs). We are trading at $3,200 pre split level.

It is going to take literally years of perfect execution for Tesla to grow into its current valuation. I am fine hanging on to my common stock for a long time and waiting for that day to occur and for further growth to come, but there is no way I am going to be levering up with options at anywhere close to this level. (Back under $400 a share - if it ever went there - I might start considering getting back into options.)

Feel free to disagree with this post - I know many will - but it feels like there are people on here who would still be saying "buy buy buy" even if the stock was trading at a $2 trillion valuation tomorrow. Some of you are losing your grip on a realistic valuation.

(starts digging a foxhole)

Not gonna bother with a disagree, but many of us believe Tesla will produce and deliver 1 million vehicles in 2021. It's very easy to go through the past year of earnings and see how unit growth has helped Tesla's operational and net margin grow which in turn we've seen how their EPS grow. It's pretty easy math to put two and two together to see what is going to happen to Tesla's EPS in 2021. Factor in Tesla being able to recognize FSD revenue/profits along with having much improved logistics from having operation factories on each continent, and EPS is going to explore higher.

If you believe Tesla is going to do a million P/D in 2021(which starts in only 9 days), then Tesla is undervalued right now...........yes even at 600 billion. My estimation of fair value for Tesla right now is based on actual fundamentals combined with what I expect from Tesla over the next year in unit volume growth and how it will affect those fundamentals. If you were to look forward to 2022 and 2023 and estimate Tesla's roadmap, it makes Tesla even more undervalued right now.

Note....I'm not saying Tesla should have a trillion market cap or 2 trillion right now....nothing like that. Simply that it's undervalued.

 

[Todd Burch]

They should not have said that. Elon doesn’t forgive/forget.

Also, because it makes them look like complete friggin’ morons. (Ever heard of SpaceX, Bloomberg?)

 

[Artful Dodger]

Pardon my lack of attention to the 2:1 dividend discussion in the pages here the last week or so. With the total shares outstanding now, after the two capital raises since September, there’s not need for voting for the company to again if it’s just calling call a 2:1 dividend right?

Correct. 2 Billion shares authorized in corporate bylaws, which can be exceed by +20% on a simple vote of the BoD. Tesla has ~963M shares outstanding now (est'd 8M for Dec 11 $5B Cap Raise).

So a max 12:5 share dividend is possible, although at 2:1 ratio seems more likely.

Cheers!

 

[Big Time]

Not gonna bother with a disagree, but many of us believe Tesla will produce and deliver 1 million vehicles in 2021. It's very easy to go through the past year of earnings and see how unit growth has helped Tesla's operational and net margin grow which in turn we've seen how their EPS grow. It's pretty easy math to put two and two together to see what is going to happen to Tesla's EPS in 2021. Factor in Tesla being able to recognize FSD revenue/profits along with having much improved logistics from having operation factories on each continent, and EPS is going to explore higher.

If you believe Tesla is going to do a million P/D in 2021(which starts in only 9 days), then Tesla is undervalued right now...........yes even at 600 billion. My estimation of fair value for Tesla right now is based on actual fundamentals combined with what I expect from Tesla over the next year in unit volume growth and how it will affect those fundamentals. If you were to look forward to 2022 and 2023 and estimate Tesla's roadmap, it makes Tesla even more undervalued right now.

Note....I'm not saying Tesla should have a trillion market cap or 2 trillion right now....nothing like that. Simply that it's undervalued.

can you elaborate more on all of this. You seem to have a good grasp on the EPS and how all that equates to valuation. I am not experienced in these areas or how to calculate. If your not busy, please go into detail comparing Tesla’s current valuation to future valuation.
from SALES turning to EPS turning to its TRADING MULTIPLE turning to VALUATION.

not trying to yell with caps just don’t know how to explain well....without yelling

Eagerly waiting for your response!!!! Thx

edit: Added a word or two to help explain question

 

[Mo City]

Not gonna bother with a disagree, but many of us believe Tesla will produce and deliver 1 million vehicles in 2021. It's very easy to go through the past year of earnings and see how unit growth has helped Tesla's operational and net margin grow which in turn we've seen how their EPS grow. It's pretty easy math to put two and two together to see what is going to happen to Tesla's EPS in 2021. Factor in Tesla being able to recognize FSD revenue/profits along with having much improved logistics from having operation factories on each continent, and EPS is going to explore higher.

If you believe Tesla is going to do a million P/D in 2021(which starts in only 9 days), then Tesla is undervalued right now...........yes even at 600 billion. My estimation of fair value for Tesla right now is based on actual fundamentals combined with what I expect from Tesla over the next year in unit volume growth and how it will affect those fundamentals. If you were to look forward to 2022 and 2023 and estimate Tesla's roadmap, it makes Tesla even more undervalued right now.

Note....I'm not saying Tesla should have a trillion market cap or 2 trillion right now....nothing like that. Simply that it's undervalued.

I agree 1M for 2021 is quite possible. Depends how fast DBE scales up in Berlin and Austin.

When the market concludes 1M for 2021 is very likely, TSLA will adjust accordingly. Give it a few months.

 

[StarFoxisDown!]

can you elaborate more on all of this. You seem to have a good grasp on the EPS and how all that equates to valuation. I am not experienced in these areas or how to calculate. If your not busy, please go into detail comparing Tesla’s current valuation to future valuation.
from SALES turning to EPS turning to its TRADING MULTIPLE turning to VALUATION.

not trying to yell with caps just don’t know how to explain well....without yelling

Eagerly waiting for your response!!!! Thx

edit: Added a word or two to help explain question

I'll gladly post a model when I get some free time after Christmas. In the meantime, just look at Gary's breakdown of unit volumes and how it affects EPS

https://mobile.twitter.com/garyblack00/status/1341463569959948291

Note - I give Gary a lot of flack, all because of the way he tries to predict short term movements in the stock. But his analysis is decent on how unit volume affects operational and margin as well as EPS. And he's being conservative on those unit volumes since he's estimating 840k delivered for 2021

 

[dl003]

All the cries of manipulation and "buying dips" while the stock is still trading in the $600s is crazy talk. Tesla is currently valued at ~$600 Billion (over $725 Billion once you account for all the approved options/RSUs). We are trading at $3,200 pre split level.

It is going to take literally years of perfect execution for Tesla to grow into its current valuation. I am fine hanging on to my common stock for a long time and waiting for that day to occur and for further growth to come, but there is no way I am going to be levering up with options at anywhere close to this level. (Back under $400 a share - if it ever went there - I might start considering getting back into options.)

Feel free to disagree with this post - I know many will - but it feels like there are people on here who would still be saying "buy buy buy" even if the stock was trading at a $2 trillion valuation tomorrow. Some of you are losing your grip on a realistic valuation.

(starts digging a foxhole)

With a few exceptions, TSLA has always been expensive by conventional wisdom.
I hate to say this, but the level of speculation in the market right now can rival that from the dot com days. AAPL is trading at 33 P:E with piss poor growth. By my own calculation, we are at about 100 - 110. Not at all expensive, considering the immense runway TSLA is staring down. We are in a steep long term upward trend and as long as TSLA keeps executing briliantly, we should stay with the trend.

 

[woodisgood]

With Trump torpedoing the stimulus bill, looks like tomorrow could be bloody.

 

[Artful Dodger]

many of us believe Tesla will produce and deliver 1 million vehicles in 2021

Well, it's very unlikely that 2021 production reaches 1M units. With Giga Shanghai predicted to make 150K Model Y in 2021 during the rampup, that's already 870K based on the 2020Q4 production run rate (182K/qtr * 4 qtrs = 720K/yr) + MiC Model Y (150K/yr).

It's not wise to count das Küken or Texas-fried chickens before they hatch, could be Q4 if things go well but meaningful volume will commence in 2021.

Better to lowball the numbers, then over-deliver if a surprise happens. Imagine in Tesla had guided for 550K in Jan 2020, then covid hit...

All in good time. 1M unit production in 2021 doesn't matter much. The current plan goes out to 2024. Plans before Model 2 should be result in 5 million units/yr capacity. We need to watch progress toward that goal, especially the bty ramp up. Tesla has guided for 100GWh in 2022, so that's a 2-yr (mid-term) goal:

Cheers!

 

[Bet TSLA]

It is going to take literally years of perfect execution for Tesla to grow into its current valuation.

I think you don't understand how exponential growth works. Tesla is demonstrably growing exponentially, and has been year after year. It owns a minuscule portion of its total addressable market, faces demonstrably bumbling competition, and is expanding into another area where those truths are even more extreme. The energy market will make the car market look really hard.

So I think it requires not perfect execution over many years, but rather reasonably guaranteed execution over perhaps three to five years. And if level 5 autonomy comes to pass in the next two years, with any attendant business advantages, it will outstrip that valuation quickly.

Tesla has done the hardest work already. Now it just needs to slot in all those top drawer newly minted engineers desperate to work for the company and put them to work making it happen. Possibly the hardest job for Tesla now is managing hypergrowth.

 

[Artful Dodger]

With Trump torpedoing the stimulus bill, looks like tomorrow could be bloody.

Not so fast:

"7 mins ago — Trump did not explicitly threaten to veto the bill, but said he was dissatisfied with its final state. The President's position could threaten to torpedo the carefully ..."​

Covid relief bill: Trump throws stimulus in doubt by asking Congress to amend it - CNNPolitics

EDIT:

POTUS asking for $2,000 checks for individuals instead of $600. House Dems already declared unanimous support. This issue is NOT going to stop a Bill from completion this week. Macro dump after-hrs is algo's.

 

[TheTalkingMule]

TSLA is worth precisely what the market is willing to pay for it. With the Fed pumping for at least another 1.5yrs and a record amount of cash STILL on the sidelines, I'm not betting against the clear #1 preferred stock and brand of humans <45.

We're entering an era of sustainable abundance where technology collects and stores energy replacing the likes of XOM or Peabody or Saudi Aramco. Energy technology is developed by engineers, and all the engineers want to work at Tesla because they innovate and execute at an unfathomable pace. I don't see that changing in the next 5 years.

Now that Tesla can build "the machine that builds the machine" and has even printed one in China in 11 months, it seems silly to think they'll do anything other than grow 30-50% annually for quite some time. I know we all love production estimates for, and thinking about the value of robotaxi, but the global energy supply is a big market.

I'm looking forward to a slight rebound in SP so I can sell a few covered calls and eject myself from this world of debating the merits of Elon Musk with the wider "analyst" population every day. We are all quite literally insane to still have any doubts about the long run potential of Tesla.