Welcome to Tesla Motors Club
Discuss Tesla's Model S, Model 3, Model X, Model Y, Cybertruck, Roadster and More.
Register

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

This site may earn commission on affiliate links.
Since the words "batteries" and "bottles" were just used together, I thought I would make use of my secret Before-The-Internet Wayback Machine to share the following, to let you know...or remember...what the state of the art was in batteries not so long ago. This one is really cool - and from (barely) less than a century ago!
Don't just look at the pictures, you Playboy fanatics. Read the words.

Screen Shot 2021-10-05 at 2.45.17 PM.png
 
from a pure broker perspective (meaning a true brokerage operation - one that doesn’t have its own proprietary positions, only a pass thru of customer —> street) here’s what i witnessed.


if you held TSLA position (settled or unsettled) as of 8/28 you are entitled to the split proceeds.

My broker (E*Trade) was so egregious that unsettled

the issuer, thus agent, didn’t release the split proceeds until wednesday 9/2,

on 9/2/20 around 11am eastern DTCC ‘credited’ their participants (those who held settled tsla shares as of 8/28 who were eligible for split) with the split proceeds.

meaning the shares from the split weren’t “settled” into each dtcc participant/firm until earliest 9/2



yes the broker generally holds cust position in an omnibus acct, so the ‘street’ doesn’t know who each beneficial owner is. but it is your brokers duty to know this

they didn’t have shares to allocate until at least 9/2, when the issuer/agent/dtcc transaction processing took place

however, some brokers ‘front’ the proceeds immediately on ex date (8/31 in this case). for example, IBKR does this, and if you held shares there, i did/do, you’ll see the total post split position, available to trade, as of open market on ex date

some brokers, as you highlighted here at the time, unfortunately don’t do that. and that’s not good. in my prior post i theorized there were many causes for poor outcomes. some potentially malicious, some potentially of incompetence. there’s a difference under the hood…but to the customer it’s just an all out bad experience. it’s more difficult to prove the malicious part than it is to point out the incompetence part. the incompetence part usually consists off firms who have antiquated processes. but…using your POV, is the process lacking to hide the mailicious behavior, or is it lacking just because they aren’t technically proficient enough to provide better service. i don’t know 100%. i just know that my broker generally does the right thing when it comes to ‘corporate actions processing’ (divs, splits, tenders, mergers) although even they have their issues at times.

My broker’s performance (E*Trade) was so egregious the “unsettled” shares were actually captured in my monthly statement. My account value appeared to decrease by 80% as the split share value was captured, but the share dividend was missing.
 
EPS estimates above $2 are super bullish to me and not at all conservative.

Energy has been incredibly lumpy earnings wise, with management saying there Is some aspect of battery supply being a big factor with the decision process being that when there are excess cells above what vehicle manufacturing can absorb then capacity goes to stationary storage output temporarily, and vice versa when vehicle capacity increases it decreases cells going to stationary storage. The fact that Tesla started offering China sourced cells for North American model 3 units suggests cell supply was restrictive in Q3, which may have reduced stationary storage product shipments vs Q2. But who knows, the Optimist in me may argue cell supply was restrictive because Tesla decided to also ship more stationary storage in North America! If there was a big downswing in energy revenue again though, it would likely send that segment back into an earnings drag rather than a contributor.

in Regards to vehicle ASPs, there were two factors currently in my mind: firstly, investor relations recently said the recent price hikes on US models wouldn’t really appear in Q3 financials as those vehciles were mostly ordered before the price hikes. Secondly, a large amount of the model Ys delivered in China in Q3 were the new cheaper SR variant, which will definitely lead to a large ASP decline in Tesla’s China ASPs, and perhaps a margin hit also. Thankfully the European model Y launch (all LR/P models) will see ASPs & margins lift in Tesla‘s Europe sales to counteract the Chinese ASP fall to some degree.

regualtory credits are notoriously hard to predict - the difference between a bumper quarter and a lean quarter is hundreds of millions in net income and it’s impossible to estimate with accuracy which way it will go in any 13 week cycle.

The “consensus estimate“ of $1.49c EPS mentioned in an earlier post by @Words of HABIT is actually a fairly good ”conservative“ earnings number to use, as I think there a several ways earnings could end up in that range If a few factors went against tesla in the quarter. In other words I think $1.49 is just as valid as $2.25 EPS estimate is, and personally I’m somewhere close to the middle of that range with my own estimate currently.

==========

slightly off topic (as it relates to future quarters, not Q3) - whenever Tesla has to pay that ridiculous court imposed fine form yesterday (after appeals are exhausted presumably), I really hope they sell down some Bitcoin holdings to pay it so it nets out as a zero on that particular quarters earnings (presuming they can still sell Bitcoin for a profit at that time).
 
Last edited:
EPS estimates above $2 are super bullish to me and not at all conservative.

Energy has been incredibly lumpy earnings wise, with management saying there Is some aspect of battery supply being a big factor with the decision process being that when their are excess cells above what vehicle manufacturing can absorb then capacity goes to stationary storage output temporarily, and vice versa when vehicle capacity increases it decreases cells going to stationary storage. The fact that Tesla started offering China sourced cells for North American model 3 units suggests cell supply was restrictive in Q3, which may have reduced stationary storage product shipments vs Q2.

in Regards to vehicle ASPs, there We’re two factors currently in my mind: firstly, investor relations recently said the recent price hikes on us models wouldn’t really appear in Q3 financials as those vehciles were mostly ordered before the price hikes. Secondly, a large amount of the model Ys delivered in China in Q3 were the new cheaper SR variant, which will definitely lead to a large ASP decline in Tesla’s China ASPs, and perhaps a margin hit also. Thankfully the European model Y launch (all LR/P models) will see ASPs & margins lift in Tesla‘s Europe sales to counteract the Chinese ASP fall to some degree.

Model Y SR didn't start selling until Sept and we don't know the ratio of SR vs LR in Sept sales.

"firstly, investor relations recently said the recent price hikes on us models wouldn’t really appear in Q3 financials as those vehciles were mostly ordered before the price hikes"

Got a link for that? Because that doesn't line up timeline-wise. There were 2-3 price hikes right at the end of Q1/beginning of Q2. The delivery times for new 3/Y orders didn't shift to Q3 timeframes until mid Q2. In fact the delivery times for 3/Y didn't really start to get extended far out until May/June......way after 3 price hikes had already happened
 
Last edited:
Are you referring to the EV credits?

That's the only income they could try to decline to recognize until a later date, but even then it's not clear how much flexibility they have there when it comes to when they have to recognize EV credit income, at least as far as I know.

Would love some clarity there though if I'm mistaken.

I am assuming this meant deferred revenue (largely for FSD) and the deferred tax something-or-other which was a lot of money but I -- obviously -- have zero understanding of it. :)
 
  • Like
Reactions: Joe F
Model Y SR didn't start selling until Sept and we don't know the ratio of SR vs LR in Sept sales.

"firstly, investor relations recently said the recent price hikes on us models wouldn’t really appear in Q3 financials as those vehciles were mostly ordered before the price hikes"

Got a link for that? Because that doesn't line up timeline-wise. There were 2-3 price hikes right at the end of Q1/beginning of Q2. The delivery times for new 3/Y orders didn't shift to Q3 timeframes until mid Q2. In fact the delivery times for 3/Y didn't really start to get extended far out until May/June......way after 3 price hikes had already happened
1. As commonly pointed out here - bulk of China local sales happen in September due to vehicles being made for export in July and most of August. Also the huge amount of anecdotal reports of teslas China stores being flooded with orders post SR introduction.

2. That comment was relayed by an analyst in a report, who had met privately with investor relations. Trying to find it but not having much luck so far. It was mentioned on here though.
 
  • Like
Reactions: MikeC
Are you referring to the EV credits?

That's the only income they could try to decline to recognize until a later date, but even then it's not clear how much flexibility they have there when it comes to when they have to recognize EV credit income, at least as far as I know.

Would love some clarity there though if I'm mistaken.
A good CFO can push revenues around like the last airbender.

flippant e.g. potentially 100 people will sue tesla for discrimination at $130m a pop - better take a $13bn provision just in case. Next quarter it turns out only 50 ex employees were treated like wretches - $6.5bn provision release to the P&L.
 
When the day comes that the credit rating for Tesla becomes investment grade, will this have any impact on way margin ratios are applied? In other words, might an investor have a little more margin available should they be holding essentially only Tesla shares?

Asking for a friend...
Tell your friend he’ll be dead before that happens. 🙄
 
1. As commonly pointed out here - bulk of China local sales happen in September due to vehicles being made for export in July and most of August. Also the huge amount of anecdotal reports of teslas China stores being flooded with orders post SR introduction.

2. That comment was relayed by an analyst in a report, who had met privately with investor relations. Trying to find it but not having much luck so far. It was mentioned on here though.

Very aware that the bulk of local sales happens in the 3rd quarter of the month.......but as is the case with US orders as we're talking about with those price hikes, there's a delay in orders and when they'll get delivered.

Tesla announced the Model Y SR in mid July, first month of this quarter. For the majority of the sales in Sept to be Model Y SR, it would mean there were hardly any existing orders for the Model Y LR in China, which I do not think to be the case. In my estimates, I'm estimating that half of Model Y sales for Sept in China were the LR variant and I think that's a conservative estimate.

Also, on that analyst report, do you possibly have time frame for when that came out? I can try and look it up. I feel like if that was said in the analyst report, it would been highlighted here and by lots of people on Twitter and this is the first I've heard of that.
 
  • Helpful
Reactions: The Accountant
what time on friday, the day before ex date, did you see the shares in your account? what broker? that doesn’t seem right either.

I took a screenshot on my broker's website (a Canadian Chartered bank) at 8:12 p.m ET on Fri, Aug 28, 2020 which shows the increased share balance due to the split, but not yet with the adjusted SP. I emailed this SS to a friend in case I ever need evidence in court (2x offsite backups).

Telsa CONFIRMED the timing of the share distribution in their SEC filing on Sep 1st, 2020. Here is my Tue, Sep 01, 2020 comment: (in reply to your comment on that day)

This is how Tesla describes the share dividend rollout in their latest SEC filling: (Sep 01)

Inline XBRL Viewer

"Stock Dividend Adjustments​
"On August 10, 2020, the board of directors of Tesla declared a five-for-one forward split of its Common Stock in the form of a stock dividend to stockholders of record on August 21, 2020 (the “Stock Dividend”). The Stock Dividend was distributed after close of trading on August 28, 2020, and trading began on a stock split-adjusted basis on August 31, 2020. As of August 28, 2020, there were approximately 933,540,135 shares of Common Stock outstanding."​

Absent other sources, I'm not seeing a lot of nuance here. I have my shares, and I could sell all of them if I wanted to, as of Market Open yesterday, Aug 28th as Tesla describes. <= Ed. note: should be Mon, Aug 31

The point is other beneficial owners DO NOT have their shares, and have only vague promises that they will receive them at an indeterminant future date.

Point to any other event in the past where this has happened during a stock dividend, then there may be useful context. Again, absent that, this is unprecented.

Again, Tesla's statement filed with the SEC was that "The Stock Dividend was distributed after close of trading on August 28, 2020, and trading began on a stock split-adjusted basis on August 31, 2020." which is in disagreement to what you wrote on Sep 01, 2020 (and to the positions you still seem to hold).

Shares weren't distributed on Thu, Sep 3rd, or whatevers depending on the Broker or some archane clearing-house shell-game, or some media commentator would have you believe. Sep 3rd DOES happen match the 2-day clearing rule for shares purchased on Sep 1st (hmm...)

Telsa stated FULL OUT that The Stock Dividend was distributed after close of trading on August 28, 2020. I saw that in my account. It would be a felony for Tesla to file a false statement to the SEC. We can take the Aug 28 timing for share distribution as FACT unless proven false in Court.

That's when all beneficial owners received their dividend shares. Any broker that did not receive enough shares did so because they didn't OWN enough shares according to the records with Tesla's share agent. And yes, those same Brokers had 3 WEEKS to correct any accounting errors (Tesla announced the share dividend on Aug 13). This wasn't an accounting error, it was because those Brokers were short shares, and couldn't poof them into existence as they usually do.

Any retail investor who didn't have their TSLA dividend shares by the Open on Monday morning, August 31 was cheated. Numerous investors here (I have bookmarks) didn't receive their additional shares until TSLA had dropped from $535 pre-Market to as low as $372 during Friday's session.

That's grounds for a lawsuit against the Broker. The fact that Wall St. rules are arranged to make it nearly impossible to collect evidence of financial crime should in fact prove motive and opportunity in Court. Instead, they are given cover and endless handwaving. It's been 13 mths.

#SEC
 
Last edited:
Auke Hoekstra tackles a ‘BEV are polluting‘ smear campaign in the FT. Expect people to quote from or refer to this article.

I have a reasonable computer, but visiting that FT website basically killed it. The site barely worked, and used as much CPU power as making an EV battery. Same old outdated info about battery environmental costs. Junk article with a lot of graphics.
 
Very aware that the bulk of local sales happens in the 3rd quarter of the month.......but as is the case with US orders as we're talking about with those price hikes, there's a delay in orders and when they'll get delivered.

Tesla announced the Model Y SR in mid July, first month of this quarter. For the majority of the sales in Sept to be Model Y SR, it would mean there were hardly any existing orders for the Model Y LR in China, which I do not think to be the case. In my estimates, I'm estimating that half of Model Y sales for Sept in China were the LR variant and I think that's a conservative estimate.

Also, on that analyst report, do you possibly have time frame for when that came out? I can try and look it up. I feel like if that was said in the analyst report, it would been highlighted here and by lots of people on Twitter and this is the first I've heard of that.

dont disagree much with your model y sales split (half of September Y sales in China) - that by itself leads to a drop in China model Y ASP for the quarter Vs the previous quarter which was 100% LR Y models.

yeah that report was mentioned on here when it happened - struggling to recall when exactly though but it was within last couple of months. (Best case scenario is I’m mis-remembering and it was in regards to Q2 earnings)
 
Last edited:
  • Like
Reactions: StarFoxisDown!
I think we will see over $2 EPS non-GAAP. It was $1.45 on ~201k deliveries. If the margin is maintained, there should be another ~8-10 cents per 10k produced over 201. So, on the low end, ~1.75-1.85 should be the 'conservative' side (good reason why the street is still missing here). I'd say there is a solid chance the margin has increased with extra S delivered and even maintaining a similar level of credits, I believe the number will be closer to ~12-14 cents per 10k (China made margins are better in Europe and more than offset SR Y, plus S sales will also help). That pushes to ~1.93-2.01 EPS without a credit increase or energy increasing margins. Based on sales of other brands, it seems regulatory credits should actually increase... I think the number will be closer to 475m... so another ~11 cents. That would push the EPS to 2.08 give or take a few cents. Op ex increase could drag it down a few cents, or if energy continues to struggle.. another few cents. On the bright side of energy, it is a pretty low bar for margin right now even getting to ~4% should add to EPS by a cent or so.

I personally think $1.95 is the low end non-GAAP. Higher credits, energy increasing margins, and more a higher Shanghai based mix could reasonably push it above 2.10. Now if there is a severe increase in op ex and this could all crumble. 1.80 would still be a great result, but I'd want to know where the drops in efficiency would come from as that would impact projections for 2022 EPS.
 
dont disagree much with your model y sales split (half of September Y sales in China) - that by itself leads to a drop in China model Y ASP for the quarter Vs the previous quarter which was 100% LR Y models.

yeah that report was mentioned on here when it happened - struggling to recall when exactly though but it was within last couple of months.

Ah I was hoping it was in the past couple of weeks cause then it would be much easier to track down on my own haha

No worries searching back through it. If the price hikes are taken out of the equation from my model, I'm much closer to Accountants EPS of $2, main difference is I think EV credits will be higher than his estimate. So that's the context of my estimates.

I think half of Model Y's Sept sales being SR is easily offset by the number of Model Y LR's sent over to Europe, the percentage of Model Y's in general over Model 3's compared to Q2, and the fact that Europe Model 3 trims were flipped on their head in Q3 where around 70-75% of the Model 3 trims registered were LR or P verses only 15-20% in Q2. So even with 15-20k Model Y SR's in Sept, I still see a material increase in ASP due to a heavier mix of LR and P trims.

I don't see how mathematically EPS can be lower than $1.80 considering the increase in deliveries and in S/X especially. The story right now is all about operational leverage.

But if Wall St wants to keep estimating $1.45, hey that's fine with me. Makes a blowout quarter in the headlines easy.
 
Seriously!?! WTF happened to the affordable car? Prices better go down once the 4680 lines are up next year and into 2023. The "affordable" version (third Gen.) of their plan is slowly drifting away....


tesla-product-roadmap.jpg
The way to prevent waiting lists of 1 year of the soon to be the quickest selling vehicle on the planet is to increase price.