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

[BMW740iL]

I like the sound of that. Can you go more into P/E and how you use it to judge companies?
I agree with you. I’m a sound/lighting guy so if I was in that room I would be feeling odd at a few of the moments. More critical of the presentation than the info!

You can still read the excellent piece on Tesla P/E by Dimitris Koutsoubos on Seeking Alpha from Jan 15. His conclusion in January (TSLA @ $811) was:

Conclusion

It is easy for everybody to see both the increasing price of the stock and the tremendous growth of the underlying business. What is less obvious and very hard to determine is whether Tesla is going to reach the business size that the market has already priced in.

Under the first two scenarios, the “hard reality” and the “feasible”, the fair value comes in at $51.40 and $79.28, respectively, promising huge losses for the current buyers. Early investors who have bought much lower, have apparently secured decent profits, even if those scenarios come true. However, they may end up with less than what the market currently tricks them into believing — mostly unrealized “paper earnings”. Only the “dream” scenario justifies the current price and can sustain their huge earnings, but it does not offer any further upside.

Price is different from value, and it’s an essential part of investing to understand the tricks that the market plays on us, so we can reliably assess our performance and competence. If we can’t measure it, we won’t improve, we won’t protect ourselves.

Happy New Year!

Dimitrios Koutsoubos

Jan 15, 2021

The 3 Scenarios For Tesla's Value (NASDAQ:TSLA)

 

[Tslynk67]

Something to file under the 'very mildly interesting' category; the trailing 12 month (non-GAAP) EPS should be exactly $1.00. Which means for the next quarter the P/E ratio will just be the stock price

Thank you, Master of Coin

 

[LiveLong&Profit]

Actually VPP does solve problems that even utility grid storage doesn't. It reduces required upgrades to the infrastructure, which Elon covered on the call. (Larger transmission lines/substations/etc.)

Agree: VPP is great.
My intention was to say that using the car as battery is not in the cards as I see it.

 

[insaneoctane]

Elon has repeatedly said V2G doesn't make much sense compared to stationary storage.

Why do people keep not believing him?

Because they already own the “V” part of V2G....As in not having to buy another item (ie powerwall). Especially now that you can’t even buy a powerwall without also buying solar. Having the expensive part of the powerwall (batteries) already available in your EV seems like a waste to ignore their capabilities. Not saying this is right or wrong, but not too hard to understand why EV owners might be enamored by V2G.

 

[cyclingthealps]

Short interest increased quite significantly from the period 03/31/2021 (share price $668) to 04/15/2021 (share price $738).
The short amount also increased a lot.

• Shares shorted from 46.270.000 to 51.180.000
• Float shorted from 6.00% to 6.63%
• Amount shorted from $30.862.090.000,00 to $37.814.343.000,00

They are currently paying big money to fight Tesla.

 

[Tslynk67]

After catching up with it all this morning, my conclusions are:

Wall Street view (short term) = many small delays, nothing new, soft guidance = meh

Tesla investor view (long term) = amazing progress, incredible agility, on track for 100% growth yoy = amazing

 

[insaneoctane]

Did anyone else think how dead the rest of the industry must be if Tesla is still so constrained by batteries? IMO Tesla has battery production costs and scale under more control than anyone and yet batteries are bending Tesla’s abilities. Part of this is self inflicted by “speed of innovation” driving them to this new form factor, but the FF and dry electrode manufacturing process are necessary for the required scaling. Anyway, it continues to be about the batteries and my money continues to literally be on Tesla...

 

[Lessmog]

Elon has said Berlin would be the first to use the structural battery pack. I think it has been presumed that this structural pack would be built around 4680 cells. We find in the call that it could be 12-18 months for the 4680's to be in volume production. If the 4680s are not ready by the time Berlin is I wonder if they can use 2170's in the structural pack.

I don't think structural packs need to be 4680 cells, I'm sure Rivian had end cooled 2170s.

But a more conventional path is 4680s from other suppliers.

We need exact quote it was something like "18 months from volume production" and "not quite ready yet to go into cars".

But previously we were told Fremont 4680s would initially go into Berlin Model Ys.

There are 3 possibilities here for initial Berlin Model Y production:-

1. 2170s
2. 4680s from external suppliers
3. 4680s from Fremont

I'm not sure which of these 3 options they will use...

I think Berlin Model Y has to have castings and a structural pack, they don't have the robots or floor space, for a more conventional production process?

Now, I did not listen in -- too late for me, and don't like the bad acoustics I was expecting. So this musing is sourced from TMC comments.

Could it be that the juxtaposition of mentioning 4680 and structural pack together (several times?) implies a need for a backup plan with a different middle section in case they need to temporarily go with a smaller cell type into the first batches from Berlin & Austin? Like, some problem with 4680 delay means a new shape for the central bottom bit. They do have these huge cranes at the gigapresses so it should be possible to swap out the molds when/if the time comes.

Wild idea? IDK. I'll be happy with whatever powers my MIE MY -- hey, is that a song riff?

 

[winfield100]

t

You can still read the excellent piece on Tesla P/E by Dimitris Koutsoubos on Seeking Alpha from Jan 15. His conclusion in January (TSLA @ $811) was:

Conclusion

It is easy for everybody to see both the increasing price of the stock and the tremendous growth of the underlying business. What is less obvious and very hard to determine is whether Tesla is going to reach the business size that the market has already priced in.

Under the first two scenarios, the “hard reality” and the “feasible”, the fair value comes in at $51.40 and $79.28, respectively, promising huge losses for the current buyers. Early investors who have bought much lower, have apparently secured decent profits, even if those scenarios come true. However, they may end up with less than what the market currently tricks them into believing — mostly unrealized “paper earnings”. Only the “dream” scenario justifies the current price and can sustain their huge earnings, but it does not offer any further upside.

Price is different from value, and it’s an essential part of investing to understand the tricks that the market plays on us, so we can reliably assess our performance and competence. If we can’t measure it, we won’t improve, we won’t protect ourselves.

Happy New Year!

Dimitrios Koutsoubos

Jan 15, 2021

The 3 Scenarios For Tesla's Value (NASDAQ:TSLA)

@BMW740iL
even a casual glance at what is essentially “tripe” to me shows massive fallacy in that author with what is best a woefully uninformed, ignorant, barely myopic view. you would do well to look elsewhere

“... unknown is massive. Somebody who believed in Steve Jobs 40 years ago could never have imagined the existence of smartphones or the massive adoption of the internet the way it is today..”

read this and think even for a scintilla of a nanosecond, sparking neurons together

what is a smartphone but a “real-time” instantiation of a ........Startrek communicator among a _lot _ of other predictions a lot of other elsewheres in a lot of SF literature

anyone whom has ever read any Science Fiction, millions of us by the way, for oh, the last 60+ years like me, understands in our core,

“ i wonder what might happen if this became true, then that could possibly happen with these other consequences......”

millions of us already imagined smart phones 50 years ago
millions of us imagined the internet 50 years ago (well a bit fewer)
I went to college at VPI, 67-73, and there was a guy working on what became internet protocols

to be extremely blunt, that guy’s writing is the equivalent of the fresh wet cow pies we tricked our cousins into putting firecrackers into, blowing up and running (you cannot run fast enough, you stand behind a tree) so they got splattered.

please.just.dont.do.that.again.reference.sleeze.kinky.ralphing.alfalfa.b.s

 

[jw934]

Now, I did not listen in -- too late for me, and don't like the bad acoustics I was expecting. So this musing is sourced from TMC comments.

Acoustics was indeed bad. Here is the full transcript for your text to voice. Tesla (TSLA) Q1 2021 Earnings Call Transcript | The Motley Fool

 

[winfield100]

For those worried they won't be able to purchase stand-alone Powerwalls, there was this on Page 9 of the release:

View attachment 657344

"As we increase our production rate, we may make it available once again as a stand-alone product."

So the situation linking Powerwall and Solar sales is only temporary while they are production constrained. As soon as battery supply and powerwall production ramps up they should make them available as stand-alone products again.

is anyone else looking at this with loving eyes, energy storage?
the US is more or less 5 electrical grids
Texas, ERCOT, is a disaster, as proven by multiple failures over the last decade, a low hanging fruit that needs a lot of energy storage to mitigate and remove outages at the worst of times

Are Texas and ERCOT one inflection point in the rising curve for Tesla Energy growth

 

[Yuha]

One thing I'd like to see Tesla improve on is that they often say "it was harder than expected", so next time they should assume it will be harder than expected and plan, as well as guide/communicate, accordingly.

Hofstadter's Law: It always takes longer than you expect, even when you take into account Hofstadter's Law.

 

[UkNorthampton]

SpaceX is gearing up for an imminent static fire test of starship SN15 *right now*. AT the same time as Elon prepares for an investor call. This is nuts. I bet he i learning his lines for SNL right now, while he has one eye on his phone watching the spacex test and one ear listening out for when tesla need him to answer questions. How does any single person do all this?

He was also nappy changing, had the phone on speaker and (unsuccessfully initially) unmuted using his nose. What a juggler!

 

[Yuha]

https://twitter.com/x/status/1386821144037236737

This confirms what I already suspected from Zach's Bitcoin comments during the earnings call: The Bitcoin sale was a test of Bitcoin liquidity.

 

[aubreymcfato]

Short interest increased quite significantly from the period 03/31/2021 (share price $668) to 04/15/2021 (share price $738).
The short amount also increased a lot.

• Shares shorted from 46.270.000 to 51.180.000
• Float shorted from 6.00% to 6.63%
• Amount shorted from $30.862.090.000,00 to $37.814.343.000,00

They are currently paying big money to fight Tesla.

View attachment 657378

What's strange is that my shares have never been borrowed¹ in the last 2 months. 0$.
It never happened before.


1. I know it's frowned upon but I own few shares and the few bucks I make help me pay the fees of the broker

 

[kalefranz]

Stolen from Twitter...

And we keep being told regulatory credits are illegitimate income. Seems like 2021 will be another strong year.

 

[PaulusdB]

The whole regulatory credits thing is just a successful frame from the spin doctors of the FUD distributors.

One might just as well state that Tesla is an extremely profitable car manufacturer, that uses regulatory credits to open extra new production capacity worldwide. So the extra expansion is paid for by laggard car manufacturers, making the Tesla chasm wider.

 

[Yuha]

I found the following comment by Elon during the earnings call quite revealing with respect to Elon's long term vision for Tesla:

"I think long term, people will think of Tesla as much as an AI robotics company as we are a car company or an energy company. I think we are developing one of the strongest hardware and software AI teams in the world."

 

[Buckminster]

Thanks - and I only post my work publicaly for my TMC team here (no twitter, Youtube, etc). I've benefited more than you could imagine from all of you that I feel an obligation to contribute in some way.

You're welcome - happy to help. Let me know if you need me to brush off my "Finance for non-financial managers" training.

I hope this call finally puts to rest the rampant speculation on this board about all those models that soon will have 4680s. It will be 1,5 to 2 years before we see meaningfull quantities of those cells go into Plaids, Model Ys, Cybertrucks, Semis and so on. But not to worry, the current batteries are great, reliable and cheap - look at those auto gross margins - and next year production of those batteries will double. Tesla will grow incredibly fast, even without 4680 being ramped yet.

The 4680 form factor can presumably be built by battery suppliers using different methods to what Tesla is trying to perfect (eg using traditional wet electrode process etc), so maybe it is possible Berlin and Austin could use non-Tesla 4680 cells. The downside of course is that those non-testa cells would cost more and perhaps have less range or other attributes?

I don't think structural packs need to be 4680 cells, I'm sure Rivian had end cooled 2170s.

But a more conventional path is 4680s from other suppliers.

We need exact quote it was something like "18 months from volume production" and "not quite ready yet to go into cars".

But previously we were told Fremont 4680s would initially go into Berlin Model Ys.

There are 3 possibilities here for initial Berlin Model Y production:-

1. 2170s
2. 4680s from external suppliers
3. 4680s from Fremont

I'm not sure which of these 3 options they will use...

I think Berlin Model Y has to have castings and a structural pack, they don't have the robots or floor space, for a more conventional production process?

Supplier output due to double this year. Maybe 50% of the increase will be 4680s. Plus a bit from Tesla. I think Berlin and Texas will be able to ramp the MY quite well. They have a million other S curves to ramp simultaneously - likelihood of the battery being the bottleneck in 2022 is low.

 

[Dancing Lemur]

I found the following comment by Elon during the earnings call quite revealing with respect to Elon's long term vision for Tesla:

"I think long term, people will think of Tesla as much as an AI robotics company as we are a car company or an energy company. I think we are developing one of the strongest hardware and software AI teams in the world."

Imagine the Boston Dynamics robots with Tesla Vision. They could be taught to do just about anything without having to be specifically controlled.

I, for one, welcome our new...