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

[Criscmt]

I'll wait. The MA(200) is in play now that its value has risen well above the Mar 5, 2021 SP dip. We've only visited the MA(200) twice since Wed, Oct 23, 2019 (hours before Q3 Earnings), and again on Mar 18, 2020 (during the Alameda/covid panik).

After our last visit to the 200-day moving avg, here's what happened the following month: (Mar-Apr 2020).

N.B. SP's shown are pre-split, MA(200) is in BLUE which is 80.10 split-adjusted):

View attachment 661156

Today the MA(200) is 578.10 or 7.2x where it was last visit. The long-term trend is strongly up.

We'll be fine. HODL'ing.

Cheers!

I am sorry, I am not following you entirely here.
Are you suggesting waiting some more time before buying, as we are likely to visit MA(200) 400.49, and then bounce from there?

 

[Curt Renz]

I am sorry, I am not following you entirely here.
Are you suggesting waiting some more time before buying, as we are likely to visit MA(200) 400.49, and then bounce from there?

The chart that Artful Dodger posted was for early 2020 at pre-split prices. As he noted, the current TSLA 200-day SMA (simple moving average) is $578.10 (post split price) as agreed by Thinkorswim.

 

[Artful Dodger]

Sheriff's are elected here in Washington too.

10-31

 

[Jack6591]

Off topic???

 

[Thekiwi]

[...]

I have to imagine they'll be in front of that and keep Tesla's P/E in the 300-500 range going forward....given Tesla's earning growth over the next couple of years.

I personally think this is unlikely to happen (that Tesla P/E will remain anywhere close to 300+ going into next year).

Tesla is entering the steepest part of the operating leverage S-curve over the next 12-18 months as net profit/EPS growth will most likely be the biggest in percentage terms that it will ever be going forward, after which profit growth in percentage terms will decrease substantially as operating expenses will already have been reduced to a fraction of gross income (down from the current ~75% level) and so net profit/EPS growth will more closely match gross profit percentage growth as time progresses (which will slow as Tesla grows from an ever growing larger existing revenue base).

The upshot of that eventuating is that Tesla will have grown into its current valuation and PE will appropriately fall from the current multi-hundreds zone into the 50-100 PE multiple zone while EPS growth moderates.

 

[StealthP3D]

If only he used all that brain computing power to follow tendies on WSB instead of asking an hammer banging orthopod.

I'm surprised to hear a doctor refer to surgical hammers with such a crude, easy to understand term. Everyone knows what a hammer is. Can't you give it a nice, mysterious Latin-sounding name like impulsum effectum deducendi? That just means "impact implement" but it's perfect because no one knows what it actually means.

 

[Criscmt]

Blighters! Just to be clear, for TSLA this implies a margin limit per share of about 165:

View attachment 661096

This limit translates into a margin limit of about 25%

Everyone should note that IB is a large brokerage, and could well set the margins stds for the industry. Plan accordingly.

Word.

Thank you.
Can I expand on this a bit to gather more information around this point?
This is for "Initial Margin Requirement".
In other words, assuming your account is all TSLA, if you already have margin beyond count * 165, "count" being your share count (not LEAPS as they don't give any margin), you will not be able to open new positions, but you likely won't get a margin call, right?
But, if maintenance margin requirement also changes similarly, margin call is to be expected. Is this correct?

 

[bigsmooth125]

Really? I think lately it's more the opposite. I hear a lot of doom and gloom around here, far more than back in the day when everyone considered themselves crusader's.

What's the difference between now and 3 or 4 years ago? We're sitting here looking at positive fundamentals a year out becoming more and more clear......and getting no reaction from the SP. Do you have some wisdom to share on a rational cause for a big drop? I've seen plenty here, but nothing to make me think a SP below $1k would be rational for year end. If you got something other than "it might go down", post!

I will say this.....the mods do occasionally delete things that really are merely negative, but it's more like friendly fire. There used to be a lot of trolling.

Finally, an invitation for an intelligent debate! Here goes: the difference between now and a few years ago is that the stock price is in the stratosphere now and it got there because of record low interest rates, terrific sales during a pandemic, a string of profitable quarters that exceeded expectations, mind-numbingly rapid expansion of gigafactories, elimination of the possibility of bankruptcy, and a presidential administration and Congress that are EV-friendly. These were all things that were unexpected; as a result, the stock price baked in more expectation-exceeding performance going forward. So, any disappointment when it comes to overall profits, profits that come from Tesla energy, production and delivery of the refreshed Model S/X or cybertruck or semi or solar roof, and rollout of FSD will logically cause the market to lose confidence in TSLA's ability to continue its rocket-like trajectory going forward. How will TSLA do in the next 6-12 months? I have no freaking clue. There are so many factors involved that have to do with Tesla's execution as well as the macroeconomy. Honestly, I've been wrong more often than right. It's just that when I, along with most of you, was right in 2020, I was really right.

I would love it if Tesla could solve FSD in the near future but I'm not holding my breath. I think people who are hanging their hats on this happening are taking a huge gamble. I'm still bullish on TSLA but my time frame is 3-5 years. Last year I was very envious of people who 50-100x'd their TSLA investment by playing options and using margin. This year not so much.

I also find it absurd that every time there's a dip in the SP, there are a number of people on here who blame it on market manipulation even as other tech stocks have been plummeting.

 

[TheTalkingMule]

I personally think this is unlikely to happen (that Tesla P/E will remain anywhere close to 300+ going into next year).

Tesla is entering the steepest part of the operating leverage S-curve over the next 12-18 months as net profit/EPS growth will most likely be the biggest in percentage terms that it will ever be going forward, after which profit growth in percentage terms will decrease substantially as operating expenses will already have been reduced to a fraction of net income (down from the current ~75% level) and so net profit/EPS growth will more closely match gross profit percentage growth as time progresses (which will slow as Tesla grows from an ever growing larger existing revenue base).

The upshot of that eventuating is that Tesla will have grown into its current valuation and PE will appropriately fall from the current multi-hundreds zone into the 50-100 PE multiple zone while EPS growth moderates.

One small problem....that's the automotive S-curve. The energy S-curve won't begin it's first bend upward until 2023/24ish.

 

[Artful Dodger]

I am sorry, I am not following you entirely here.
Are you suggesting waiting some more time before buying, as we are likely to visit MA(200) 400.49, and then bounce from there?

Lol, no, I'm telling you what I am doing.

You're welcome.

Cheers!

 

[TheTalkingMule]

Finally, an invitation for an intelligent debate! Here goes: the difference between now and a few years ago is that the stock price is in the stratosphere now and it got there because of record low interest rates, terrific sales during a pandemic, a string of profitable quarters that exceeded expectations, mind-numbingly rapid expansion of gigafactories, elimination of the possibility of bankruptcy, and a presidential administration and Congress that are EV-friendly. These were all things that were unexpected; as a result, the stock price baked in more expectation-exceeding performance going forward. So, any disappointment when it comes to overall profits, profits that come from Tesla energy, production and delivery of the refreshed Model S/X or cybertruck or semi or solar roof, and rollout of FSD will logically cause the market to lose confidence in TSLA's ability to continue its rocket-like trajectory going forward. How will TSLA do in the next 6-12 months? I have no freaking clue. There are so many factors involved that have to do with Tesla's execution as well as the macroeconomy. Honestly, I've been wrong more often than right. It's just that when I, along with most of you, was right in 2020, I was really right.

I would love it if Tesla could solve FSD in the near future but I'm not holding my breath. I think people who are hanging their hats on this happening are taking a huge gamble. I'm still bullish on TSLA but my time frame is 3-5 years. Last year I was very envious of people who 50-100x'd their TSLA investment by playing options and using margin. This year not so much.

I also find it absurd that every time there's a dip in the SP, there are a number of people on here who blame it on market manipulation even as other tech stocks have been plummeting.

You don't know how Tesla will execute in the next 6-12 and think the SP could drop. I think 1Q gave us a very strong indication of how execution is going to go the next 6-12 months and think we're consolidating for the next leg up.

What's the problem?

I don't see much of a case being made for a SP drop other than "it could" or "it's too high". IMO those aren't arguments, they're just feelings.

To me, we're now looking at a fairly certain 80+% growth for 2021 and an even more certain 80-100% growth in 2022. For a company that's already highly profitable. And then ~50% growth per year moving forward. That's unprecedented madness.

As for "manipulation", sure the term is overused here quite a bit. But TSLA is the single mist shorted stock of all time, if you don't think there are market makers doing far far more than making markets.....you ain't paying attention.

 

[Artful Dodger]

Thank you.
Can I expand on this a bit to gather more information around this point?
This is for "Initial Margin Requirement".
In other words, assuming your account is all TSLA, if you already have margin beyond count * 165, "count" being your share count (not LEAPS as they don't give any margin), you will not be able to open new positions, but you likely won't get a margin call, right?
But, if maintenance margin requirement also changes similarly, margin call is to be expected. Is this correct?

No idea. Margin not allowed in a TFSA (my tax-free saving acct), and I don't do options (leverage). I'm a "buy-rite 'n' hold-tight" kinda guy (with this latest dip, I'm still holding a 10-bagger).

Might add a few if we hit the MA(200) but that's mostly vanity: I could add 10% more shares for only double my initial investment.

Maybe the OP could answer your questions. Paging @kengchang

 

[Thekiwi]

One small problem....that's the automotive S-curve. The energy S-curve won't begin it's first bend upward until 2023/24ish.

but with already gigantic profits at that stage the energy S-curve will be much flatter to overall company net income and will have dramatically less impact in percentage growth terms

 

[traxila]

I am sorry, I am not following you entirely here.
Are you suggesting waiting some more time before buying, as we are likely to visit MA(200) 400.49, and then bounce from there?

He states he is HODling.

His avatar is diamond hands.

Art is amazing. He always seems to know when to buy and when the SP is shaky. He pinpoints bounce points before they are hit based on his TA. I have witnessed this multiple times. And he doesn’t get rattled.

But I don’t think he trades. I believe all he does is buy and hold.

Correct me if I wrong, Sir Dodger.

EDIT: I see Art has already clarified for you.

 

[asburgers]

What ever happened to JPOW's printer anyways?

 

[enzo]

Twitter videos of overrun gas stations rolling in. Tomorrow's news, today.
Then again, it is merely a matter of schadenfreude to investors, as certainly actual news in support of EVs will have no bearing on the share price.

 

[StealthP3D]

Hey guys I want your opinion on my take of the situation:

Bullish:
- It seems like the sharp move downwards over the last week and it breaking through the BB's and the bottom of the long-term channel is a fake-out.
- IMO they're trying to trigger stop losses and cause panic selling so they can cover short positions, then reposition to take advantage of the movement back to the top of the channel.
- If this theory is correct, it might be pretty ugly at the open tomorrow but an intra-day rebound above 650 would help confirm it and give confidence for more buying

Bearish:
- The fact that it was able to break through 650 shows weak buying pressure, so even if it rebounds it may be a slower climb.
- The current rotation away from growth and lack of upcoming catalysts (FSD v9 and AI day are on Elon-Time) means Tesla is following the broader market trends. If the big bois aren't playing the technicals like I'm hoping, we could see an extended downside.

Silver lining:
- At some point, this rotation will end and money will flood back into tech regardless of how Tesla is doing. I think when that happens, all of the bullish news that's been ignored lately will get factored in, leading to a massive run ...Eventually

PS: I'm betting hard on the bullish scenario. Every time I've felt this uneasy it's been the right time to buy

In the 4th Q of 2019 I wrote a lot about how share prices have momentum and that it works in both directions. There is considerable downward momentum right now but it's pretty much impossible to say how far that could take it. But, my entire life spent watching stock prices tells me that even good stocks with bright futures can go lower than they have any business going before they turn around. Much of it will probably depend on the overall mood of the market. If that doesn't co-operate, look out below!

Since it's probably apparent even to casual observers that Tesla has a very high likelihood of a bright future, there is a good chance Tesla will be a leading indicator of market strength returning. Unfortunately, that doesn't tell us when this turnaround will happen and my intuition says this will not be as clean of a turnaround as it was in early 2020. Head fakes could confuse the issue unless this is nothing more than another "blip" which is certainly possible.

While I am not a big fan of technical chart analysis, I am a believer in "pretty charts". This just means that charts tend to look "right" and I can't define what "right" is, it's more of a feeling. This is what technical analysis tries to turn into a science (but, IMO, mostly fails). IMO, the chart is telling us there must be more downside to make the chart look "right" and that it will probably take more than a couple of weeks. I tend not to try to play these moves because they are just noise in the bigger picture and impactful news can blow everything I just said out of the water. If it were not for market moving news, I believe all charts would look "pretty" and "right". The "pretty" and "right" charts takes us downward and rightward. Then it breaks to the upside, either unexpectedly (by news) or at the proper "pretty" place because sentiment finally has a change that sticks.

A few months ago I said I don't mind if we hang out somewhere in the $500's to the $800's for the rest of the year and that's still where I stand. I still think we have a decent chance of breaking out into the four digits before the year is out (better than 50/50) but if I have to wait until next year, I won't lose any sleep over it.

 

[UnknownSoldier]

What ever happened to JPOW's printer anyways?

It printed over $4 trillion last year. After that, it has earned a well-deserved rest.

 

[DragonWatch]

I simply wanted to point out that Olympia has the best children's museum ever!

Absolutely! Helped donate to bring it about. Lived in Oly from 1999 thru 2019. Moving back to be closer to GrandPups

 

[DragonWatch]

But last I checked Tesla is not installing solar roofs here yet.

As a long time red eyed bull I am trying to kick start it in Oly. Please give me a contact to move Tesla solar roofs.