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

[Krugerrand]

I'm more of what you would describe as obese on TSLA, and consume more of those marshmallow LEAPs seemingly daily.

Pfft! Lightweight. I have a BMI of 420.

 

[oldTAVguy]

I think we're dramatically underestimating the implications of this retail shift. To full on abandon high traffic retail is to say demand is clearly far outstripping supply for at least the next handful of years. And then you get the cost savings....good luck to those with a dealership model(i.e. everyone).

Looks like similar volume today, not insane but up a good bit from the doldrums of pre-earnings. If we can safely assume this isn't real selling, then we can only assume this volume with flat/down SP action is buying that's being counteracted by MM shorting.

I wonder how long they can keep hoovering up these orders? Used to be there was a 2 day delay in market reaction to bullish news as MM's tried to absorb the early reaction and temper euphoria. Maybe this is one of those? Will they need to start hedging as call/LEAP open interest builds?

Remember Tesla does not SELL cars, solar systems and storage systems. They provide what smart companies and consumers WANT TO BUY.

 

[JusRelax]

Followup from yesterday, when some here (including myself) were assuming that Tesla performed much better than other EV companies yesterday due to earnings - apparently, we were wrong. Pretty much all of the 'gains' (i.e. - non-losses) were given back today:

 

[Tslynk67]

Some top-quality manipulation ongoing today, capping below 650 while the sector sharply rises, then letting it fall when the rest drop...

 

[Krugerrand]

Huh. Given all the bluster I assumed you would have had the surveillance in place to know one way or the other. This blind spot will likely be of interest to @Unpilot.

It’s a temporary vulnerability. Starlink will be up and running shortly. Then I will know.

 

[InTheShadows]

The assumption here is that it is a blunder, rather than say an issue with parts, or simply part of a production ramp.

We have been told volume production of a new/refreshed car is hard. We know there a parrs supply issues at present and significant new technology in the refreshed S.

We also know Q2 results were stellar regardless.

I think the problem for Tesla is compounded. I don’t think a “regular” car company would have the same scaling problems that Tesla is having. The only reason I think that is because no other car company is even considering ramping production as fast as Tesla is. There problem seems to be with the upstream manufacturers keeping up with Tesla. They are having problems scaling at a rate that meets Tesla’s demand for their parts.

Compound Tesla’s growth with the growth of asic miners and solar equipment, all of which likely use the same chips and we have a massive chip shortage problem.

I am slightly confused by the shortage of airbag control modules. If they are the same for all vehicles, the other manufacturers scaling back production should free them up for Tesla.

 

[EnzoXYZ]

Imagining LUCID opening a store next to Tesla at the mall only to find Tesla store closed

Here in Oak Brook, IL Lucid took over the exact store Tesla left over a year ago. The shopping mall is higher end and rent is expensive. The below photo is older as the store is open. There is a Beta 2 candidate Air in the show room. Talk to the Lucid rep for good 10 minutes. IMO everything with Lucid down to the feel of the showroom has a Tesla feel. I signed up for a future Test drive as the salesman made everything sound amazing. I’ll see for myself if it’s hot air or not.

 

[lnb2g]

Just dropped to 642 from 650 with no news and low volume. Is this another short attack?

 

[Christine69420]

If you like me feel dizzy today watching the share price and the TSLA 10-Q just have a glass of red or whatever you prefer and remember that the shortzes will have to give up long before us HODLers.

They are burning money and effort. We burn for Tesla's mission.

"Overweight" means that they recommend being overweight TSLA in your portfolio. It's a good thing.

And thought that it was a FatFIRE term...

 

[ZachF]

It's maybe useful to point out that Magna manufactures the Jaguar iPace and a number of others. Right now they make models from JLR, Toyota , BMW, and Toyota.

https://planttour.magnasteyr.com/index_ENG.php

Among those eight Tier One suppliers all make huge volumes of components including engineering and control/management of whatever they supply. For the prime users of these approaches the supplier independently designs whatever they supply. That is very efficient when no new technologies are needed. In new technologies, not so much. Thus we have VW id. 3 and many others, including Chevrolet Bolt.

Tesla, for the initial Model S was constrained in manufacturing, design and above all, very nearly unable to get supplier cooperation. As Elon said, 'we could not get the A team and sometimes could not get anyone at all'. Mercedes came to the rescue and had their suppliers provide many major Model S parts. As I recall, two air conditioner compressors from MB supplier, one for battery BMS and one for cabin. Suspension parts, switchgear and much else was taken form the Mercedes parts catalog without alteration.

That approach served Tesla well in the beginning, because otherwise they would not have been able to launch the Model S.

Soon, part by part, Tesla discovered better ways to accomplish something. Soon, less quickly, Tesla grew enough so respectable suppliers would actually deal with Tesla. Then, Tesla began, little by little, learning to do better by themselves, even seats (almost no other OEM made their own seats). Following many improvements Tesla borrowed a proprietary Inconel from SpaceX and gave us Ludicrous.

When Model X came along Tesla ended out designing and building many things that suppliers couldn't do. The FWD were to made by a supplier, which could not do it, so Tesla did it themselves and invited ne seniors and other thing to make them work. The vertical integration crept up bit by bit.

When Model 3 arrived Tesla began wholesale reinvention of numerous things, many of which Tesla made themselves. With Model Y and reconsideration of how to approach manufacturing after the initial mess with Model 3 came the realization that there were 'too many parts'. Then came bigger presses, even bigger bigger presses, then Gigapress and coming very soon even bigger Gigapresses. Along with those developments came hundreds of complete redesign elements including the SpaceX creation of Octovalve.

I gave just a few examples to illustrate how Tesla arrived at the highest vertical integration in the auto industry essentially by borrowing from SpaceX, which had itself been forced to vertical integration because they could not buy rockets.

Now teal designs their own FSD chips builds their own Supercomputers to get to FSD, sometime...

Today, watch Sandy Munro do teardown of BEVs. From IPace, VW, GM and Ford we see supplier dominations many dozens of different chips and complete independent major components. We see suppliers dictate complete subsystems, because the OEM does not want to do it themselves. We see dozens of different and incompatible fasteners. We also see no genuine systems integration.

The lesson for us all is that Tesla is reinventing manufacturing just as SpaceX did before it. The result is spectacular when it works. However, the learning curve has mistakes, misjudgments and uncertain timelines.

As we look at Tesla failures to deliver on time and with smoothly perfected whatever the item is we ned to remember that Tesla is redefining the automobile, redefining grid services, redefining energy storage and, in spare time, inventing a solar roof. None fo that is precisely predictable.

Were this to have been a 'normal OEM' Magna-Steyr or Valmet would be doing contract manufacturing. There would be other suppliers from the @UkNorthampton list doing most major systems. They would work. They would be reliable. They would not make anything innovative.

As we criticize Tesla faults we need regularly to remind ourselves what is actually happening.

Nothing about that makes me any less irritated that my Plaid has not been delivered, a month after promised (sort of..).

As we value TSLA shares we really need to remind ourselves that one major part is manufacturing innovation. That single thing keeps Tesla advancing versus all the OEM's who know exactly how do do this because they've done it for 'a hundred years'. Every analyst seems unable to comprehend just how consequential all this is.

A+ post.

Tesla and SpaceX are showing the way forward in 21st century manufacturing is vertical integration.

The lazy mostly boomer GE/Welch era of "outsource everything but the badge" is over.

 

[StarFoxisDown!]

Sigh......new day same action.

Everyone loves to use the "excuse of the day" for a why TSLA stock continues to underperform. One day its the 10-year note. Next day a bitcoin drop. Next day China regulation. Next day the entire auto sector is down. Next day the entire tech sector is down. Each time the stocks that were down, rebound the next day while TSLA does nothing or continues further down.

Point being, I think we can stop looking for any excuses on any given day about why TSLA stock underperforms.....day after day after day. Anyone that thinks this is simply MM's doing the controlling for option purposes I think is being a bit naïve. To have this level of continual underperformance combined with consistently very low volume compared to just 7 months ago wreaks of market manipulation on multiple levels/fronts.

Seems pretty clear the stock isn't moving until the vast majority of funds that wanted in, whether through stock or options, get what they want.

 

[Marc_K_inNJ]

Just dropped to 642 from 650 with no news and low volume. Is this another short attack?

It's always a "short attack"
The MM's are in control everyday...
Something really crazy needs to happen to overwhelm them...

Edit: Max Pain dropped today to 647.5 - look for it to end on Friday at about that price...

 

[Rb48888]

I am slightly confused by the shortage of airbag control modules. If they are the same for all vehicles, the other manufacturers scaling back production should free them up for Tesla.

Maybe. (With compliments to Dodger)

Elon addressed airbag deployment software in his latest appearance on the Joe Rogan Experience #1609. During the podcast, Elon said that Tesla not only measures the weight of the person in each seat, but they also know which part of the seat they are sitting on. The airbag deployment is software controlled to match the individual occupant. Tesla goes WAY BEYOND regulatory requirements for safety in this respect, and indeed in every aspect of their car design.

 

[Tslynk67]

Just dropped to 642 from 650 with no news and low volume. Is this another short attack?

Was being capped below 650 while the other growth EV stocks were sharply rising, then when the algos decided to sell off the sector, $TSLA was allowed to fall too - Max Pain is currently $647.50 for this Friday (likely will drop a bit before then to $645), so MM's keeping it under control

Edit: ad graph, updated

 

[StarFoxisDown!]

Btw, not being a debbie downer........they will be forced to pay up eventually and given how amazing Q2 earnings were, it's going to be faster than even I predicted. The Accountant made a post with a chart a couple weeks ago comparing Amazon and Tesla's P/E's during their growth runs and how their P/E/s dropped over the 5 year time span while the stock price went up.

Given the amazing margins all around on Q2 and what we can project out going forward, Tesla's P/E compression will happen faster than what he showed in that chart. A bout a third faster.

Meaning, while Wall St is blatantly manipulating the stock from many different angles, I've never been more confident in the LEAPS I bought yesterday. Holy cow what a gift

 

[madodel]

Pfft! Lightweight. I have a BMI of 420.

So more of a @Krugerrand the Hut eh? When you say your mountain, I now can picture it, and it ain't pretty.

 

[TheTalkingMule]

Sigh......new day same action.

Everyone loves to use the "excuse of the day" for a why TSLA stock continues to underperform. One day its the 10-year note. Next day a bitcoin drop. Next day China regulation. Next day the entire auto sector is down. Next day the entire tech sector is down. Each time the stocks that were down, rebound the next day while TSLA does nothing or continues further down.

Point being, I think we can stop looking for any excuses on any given day about why TSLA stock underperforms.....day after day after day. Anyone that thinks this is simply MM's doing the controlling for option purposes I think is being a bit naïve. To have this level of continual underperformance combined with consistently very low volume compared to just 7 months ago wreaks of market manipulation on multiple levels/fronts.

Seems pretty clear the stock isn't moving until the vast majority of funds that wanted in, whether through stock or options, get what they want.

Making markets is by definition a form of market manipulation. Who's to say when people cross the line?

And they have plenty of motives beyond just hitting max pain for options.
Ken Griffin doesn't just own Citadel Securities, he's probably got a dozen or two hedge funds as well.
Then there are all the hedge fund clients of Citadel.
Plus all the various brokers who need to be protected from losing so much money they can't pay the MM(see: Gamestop).

There's plenty of motivation to do exactly what we've been seeing since 1Q P&D was announced. Is it appropriate market making or fraudulent manipulation? Hard to say without a regulatory body willing to even take a glance into the mechanism of market making. We simply can't know. there's not enough transparency to make the call.

I would be willing to bet these entities are all acting in their own obvious interest. And that likely nets out to something that looks like collective fraud. At least we know what's likely happening. In many ways that's ideal.

 

[TheTalkingMule]

Btw, not being a debbie downer........they will be forced to pay up eventually and given how amazing Q2 earnings were, it's going to be faster than even I predicted. The Accountant made a post with a chart a couple weeks ago comparing Amazon and Tesla's P/E's during their growth runs and how their P/E/s dropped over the 5 year time span while the stock price went up.

Given the amazing margins all around on Q2 and what we can project out going forward, Tesla's P/E compression will happen faster than what he showed in that chart. A bout a third faster.

Meaning, while Wall St is blatantly manipulating the stock from many different angles, I've never been more confident in the LEAPS I bought yesterday. Holy cow what a gift

Exactly. We're entering the window of time where the furthest out LEAPs are a stone cold lock. That's why I think the floodgates have to be released soon.

 

[Curt Renz]

Speaking of double takes, Morgan Stanley views TSLA as Overweight, but then goes on about it being a "Double Flywheel" of momentum bc of its lead. Doesnt make sense, why overweight then decribe how they will dominate the future. Was in news on TD site, an error maybe?

Overweight is the term that Morgan Stanley uses in the sense that some other firms call Buy.

From MarketWatch:

Morgan Stanley

• Overweight
  Stock's total return is expected to exceed the average total return of the analyst's industry coverage universe, on a risk-adjusted basis, over next 12-18 months.
• Equal-weight
  Stock's total return is expected to be in line with the average total return of the analyst's industry coverage universe, on a risk-adjusted basis, over next 12-18 months.
• Underweight
  Stock's total return is expected to be below the average total return of the analyst's industry coverage universe, on a risk-adjusted basis, over next 12-18 months.
• More Volatile
  Estimates stock has more than 25% chance of price move up or down of more than 25% in a month, based on a quantitative assessment of historical data. Or, in analyst's view, is likely to become materially more volatile over next 1-12 months compared with past 3 years. Stocks with less than one year of trading history are automatically rated as more volatile unless otherwise noted.

 

[dl003]

Sigh......new day same action.

Everyone loves to use the "excuse of the day" for a why TSLA stock continues to underperform. One day its the 10-year note. Next day a bitcoin drop. Next day China regulation. Next day the entire auto sector is down. Next day the entire tech sector is down. Each time the stocks that were down, rebound the next day while TSLA does nothing or continues further down.

Point being, I think we can stop looking for any excuses on any given day about why TSLA stock underperforms.....day after day after day. Anyone that thinks this is simply MM's doing the controlling for option purposes I think is being a bit naïve. To have this level of continual underperformance combined with consistently very low volume compared to just 7 months ago wreaks of market manipulation on multiple levels/fronts.

Seems pretty clear the stock isn't moving until the vast majority of funds that wanted in, whether through stock or options, get what they want.

While it is clear to me that the stock is manipulated, the lack of interest in TSLA also helps. Problem? No. The market is functioning as expected. I see the market collectively as a greedy coward, always taking the path of least resistance. While interest in TSLA surely had picked up over the last year, the level of understanding of its fundamentals is still non-existent. When the uninformed vast majority faces "competition", "chip shortage", and "delays", the natural tendency will be to ignore the stock. I dipped into margin yesterday, as mentioned earlier, and felt pretty good about it. When the stock finally takes off, when I don't know, the herd mentality is going to swing in the opposite direction, creating a rip your face off rally. If there is something I'm disappointed about, it's our low level of intelligence as a species.