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

[StarFoxisDown!]

You're missing one important piece: NFLX is guiding for only 10M new subs for 2022. That's a YOY growth of only 4%. I believe this is what's tanking the stock. Nobody wants a 40 PE stock that only guides for 4% growth.

Exactly what I was just about to respond with. Not only that, NFLX is forecasting operating margin to shrink for 2022 verses 2021. They're not even going to be able to meet 2021 earnings......that means big things for NFLX's valuation metrics.

What Sudre wrote is detached from reality and ignoring practically everything about what's actually happening in real time about Netflix's business and it's outlook and thus valuation. The drop in NFLX is more than justified.

Essentially for Netflix, the only way their P/E multiple is going to drop is through the stock going down. Meanwhile.....TSLA could continue going higher at a clip of 10-15% per quarter and it's P/E multiple will still drop rapidly.

 

[Right_Said_Fred]

Welp, looking at today's sp is like watching a train wreck in slow motion knowing what thestockchannel said. Hoping that his analysis is full of *sugar* right now and none of this is real. Those who were celebrating that his TA was nonsense just got slapped pretty hard.

btw, people need to pay attention to QQQ TA only. Everything else less relevant as we go through this correction.

If you say ‘those celebrating that his TA was nonsense’ got slapped hard, then this morning the ones celebrating that ‘his TA is great’ got slapped hard.

You cannot predict that after a close below 1000 (which 995 was) we will go to 940 and then see the stock rise to 1040 and act as if nothing happened. If someone had shorted TSLA yesterday at close by following his prediction, they would have been stopped out today to avoid a big loss (prudent traders have stop losses). And if we had gone to 1100 this TA guy wouldn’t have said ‘I was wrong’, but would have acted as if nothing happened and said ‘a close above 1100 will mark an end to the down trend’.

I know The Stocks Channel is just one source and investors and traders should use multiple sources of information, but what bothers me is that this channel is being plugged here as the holy grail of TA.

I believe TA has value (if only because people follow it, which makes it a self-fullfilling prophecy), but that doesn’t mean everyone is good at it.

 

[Sudre]

Exactly what I was just about to respond with. Not only that, NFLX is forecasting operating margin to shrink for 2022 verses 2021. They're not even going to be able to meet 2021 earnings......that means big things for NFLX's valuation metrics.

What Sudre wrote is detached from reality and ignoring practically everything what's actually happening in real time about Netflix's business and it's outlook and thus valuation. The drop in NFLX is more than justified.

Essentially for Netflix, the only way their P/E multiple is going to drop is through the stock going down. Meanwhile.....TSLA could continue going higher at a clip of 10-15% per quarter and it's P/E multiple will still drop rapidly.

I will go with your take then. I think a 20% drop plus probably more tomorrow is a bit extreme but maybe not.

 

[StarFoxisDown!]

I will go with your take then. I think a 20% drop plus probably more tomorrow is a bit extreme but maybe not.

It's extreme for sure. In a calmer/more rational market it should down about 5-10% on this. 5% purely for metrics and the actual future numbers. Another 5% because it's rather realistic to expect them to face even more headwinds than they're saying right now.

But in today's market, yeah that's gonna be a 15-20% drop since P/E multiples are being compressed. (It'll likely end the day down more like 12-15%).

 

[vikings123]

If you say ‘those celebrating that his TA was nonsense’ got slapped hard, then this morning the ones celebrating that ‘his TA is great’ got slapped hard.

You cannot predict that after a close below 1000 (which 995 was) we will go to 940 and then see the stock rise to 1040 and act as if nothing happened. If someone had shorted TSLA yesterday at close by following his prediction, they would have been stopped out today to avoid a big loss (prudent traders have stop losses). And if we had gone to 1100 this TA guy wouldn’t have said ‘I was wrong’, but would have acted as if nothing happened and said ‘a close above 1100 will mark an end to the down trend’.

I know The Stocks Channel is just one source and investors and traders should use multiple sources of information, but what bothers me is that this channel is being plugged here as the holy grail of TA.

I believe TA has value (if only because people follow it, which makes it a self-fullfilling prophecy), but that doesn’t mean everyone is good at it.

Great post. TA is not predictive so anybody that gives you predictions is pretty much doing you a disservice. The best traders don't predict, they wait for channels to confirm. For example 980 level is obviously a key level for TSLA and has acted as great support recently.

If the 980 channel breaks then I can see how that could trigger some limit orders and send us further down. They came for the 980 in AH but nice bounce from TSLA.

 

[Big Time]

MB wallstreet will get all of the after earnings mega drops out of its system before TSLA hits the stage. I seem to remember this happening quite a bit in the most recent quarters with Apple etc etc

 

[Phobi]

Rock solid fundamentals with "conservative" growth going well into the foreseeable future?

Elon: Ok. Sure.


Can't wait till next week. They are running out of time...

 

[Singuy]

If you say ‘those celebrating that his TA was nonsense’ got slapped hard, then this morning the ones celebrating that ‘his TA is great’ got slapped hard.

You cannot predict that after a close below 1000 (which 995 was) we will go to 940 and then see the stock rise to 1040 and act as if nothing happened. If someone had shorted TSLA yesterday at close by following his prediction, they would have been stopped out today to avoid a big loss (prudent traders have stop losses). And if we had gone to 1100 this TA guy wouldn’t have said ‘I was wrong’, but would have acted as if nothing happened and said ‘a close above 1100 will mark an end to the down trend’.

I know The Stocks Channel is just one source and investors and traders should use multiple sources of information, but what bothers me is that this channel is being plugged here as the holy grail of TA.

I believe TA has value (if only because people follow it, which makes it a self-fullfilling prophecy), but that doesn’t mean everyone is good at it.

I feel like people still don't understand how to interpret TA. Everything is on the level of chance. 50/50 is the coin toss...however if something hits a certain technical, then it's no longer 50/50...now it's 70/30 of something happening...and if it hits the technicals again, then the chances go up even higher. For example, Tesla closing under 1000 swings the favor of it going down to close the gap at 940 beyond 50/50, and if it closes above 1000 then the chance of it going down to close the cap is lower than 50/50. Now that Tesla have closed 2x under 1k, the chance of it gap filling is higher than yesterday but it's still not 100%.

Nothing is 100% as no one is a time traveler, but you are suppose to use the information to weight the chances in your favor. When I saw we got rejected today on the Qs at 374, I was pretty bearish as it's the 2nd try at breaking that level. Even with my hopes and prayers that Cory on thestockchannel is full of *sugar*, the QQQ still dumped as predicted(again not 100% chance of prediction, but much higher than 50/50).

And this is why he doesn't have a 100% success rate but with the chances stacked in these technical favor, the result seems pretty close to 90%+. Listen closely to way he say. He always use the term "we may see". Key word being MAY. He never speaks in certainty.

 

[Artful Dodger]

This is the quote I’m referring to. “In Q4 2020, Netflix added 8.5 million subscribers. The company also said for the first quarter of 2022, it expects to add 2.5 million subscribers, compared to the 3.98 million it added in Q1 2021.”

NFLX stock clearly jumped off a cliff:

Both MSFT (-0.36%) and TSLA (-0.89%) are faring relatively well (considering) in the After-hrs session. Maybe this is what this Market needs to 'clear the pipes' and resume the rally.

Cheers!

 

[hacer]

We are on the trailing end of the worst part of a pandemic. Immunizations are available. People are going back to work and have less time to watch Netflix all day. It's obvious that subscriber base would be down and that NFLX probably isn't a good stock to own at this point in time. It's probably why they raised their subscription price.

Don't see how that has any correlation to TSLA's performance really. Who knows, maybe people leaving NFLX will flock into TSLA, which is a**ing kicks and naming takes.

It's because Tesla manufactures devices for watching Netflix.

 

[OrthoSurg]

Where all that money running away from NFLX and PTON going to go? In the company with the greatest earning grow of all time?

 

[Mengy]

It's because Tesla manufactures devices for watching Netflix.

I do this. Though I think I've watched more Disney Plus than Netflix in my Model Y. Sell NFLX and buy DIS?

 

[ggr]

I received personal messages from knowledgeable TMC members. We all agree that Tesla Facts must have been using the word "short" to mean "underweight", as in underweight TSLA compared to the S&P500. One message suggested that since some funds are based in other countries, not all funds are comparing themselves to the S&P500. Another comment suggested that these funds are long-only funds, so that they wouldn't actually be shorting a stock by selling borrowed shares. Yet another comment pointed out that some funds are constrained (such as only being able to buy shares in companies whose debt is deemed "investment-grade"). Many thanks for the comments! I'll have to return my scrutiny back to the hedge funds for some of the apparent manipulative shorting I suspect has been underway. Still, as Tesla continues to grow at greater than 50% annually and margins tend upward, at some point most of these funds will want to acquire the missing 100 million TSLA shares if they wish to avoid underperforming.

Over on his dedicated thread, @Papafox clarified yesterday's post (today's isn't out yet). I have a question that maybe someone could answer. It's true that there are funds that can't invest in stocks below a certain grade, and as we know TSLA is ridiculously under-graded. Are any such funds benchmarked against the S&P 500? And the reciprocal question is, how many of the larger components of the S&P 500 are NOT investment grade (besides TSLA)?

Mod: This is an example of the right way to ask Papa questions. You add his post to multi-quote using the "+ Quote" button instead of the "Reply" button, switch to this thread, and in the reply box press "Add quote". DO NOT reply in his thread. --ggr

 

[StarFoxisDown!]

Over on his dedicated thread, @Papafox clarified yesterday's post (today's isn't out yet). I have a question that maybe someone could answer. It's true that there are funds that can't invest in stocks below a certain grade, and as we know TSLA is ridiculously under-graded. Are any such funds benchmarked against the S&P 500? And the reciprocal question is, how many of the larger components of the S&P 500 are NOT investment grade (besides TSLA)?

Yes there are index funds, especially 401k funds, that can't invest in companies that aren't rated investment grade.

You could easily start to piece together that the reason TSLA hasn't been rated investment grade despite have better finances than every auto maker is that investment banks and hedge funds, who have proven ties to Moody's/S&P, do not want TSLA to be investment grade because it will take away a ton of volatility.

 

[ggr]

Yes there are index funds, especially 401k funds, that can't invest in companies that aren't rated investment grade.

Yeah, know that, even said it in my post. The question was: are they benchmarked against the S&P?

 

[StarFoxisDown!]

Yeah, know that, even said it in my post. The question was: are they benchmarked against the S&P?

Someone can correct me if I'm wrong, but I do not believe they are since they are not S&P specific index funds.

 

[Knightshade]

Yes there are index funds, especially 401k funds, that can't invest in companies that aren't rated investment grade.

You could easily start to piece together that the reason TSLA hasn't been rated investment grade despite have better finances than every auto maker is that investment banks and hedge funds, who have proven ties to Moody's/S&P, do not want TSLA to be investment grade because it will take away a ton of volatility.

Didn't S&P inclusion debunk the idea more funds holding would reduce volatility?

 

[Singuy]

Yes there are index funds, especially 401k funds, that can't invest in companies that aren't rated investment grade.

You could easily start to piece together that the reason TSLA hasn't been rated investment grade despite have better finances than every auto maker is that investment banks and hedge funds, who have proven ties to Moody's/S&P, do not want TSLA to be investment grade because it will take away a ton of volatility.

And for people who wants to know when S&P or Moody will upgrade Tesla to investment grade, this guy is predicting the summer. The reason is that he goes through what these rating companies have said that will change their rating to the up or downside. Basically these rating agencies are waiting for Giga Berlin/Texas to be in production while needing Tesla to show a positive EBITA margin of a percentage of their choosing. They see these two factories ramping as a near term risk to margins and would upgrade once they have clarity on the matter(or downgrade).

 

[2daMoon]

I really like this guy's style, and, am particularly fond of how he can so easily rationalize my dreams for TSLA. The title says it all.

Edit: Perhaps this might be something "They" should use for guidance...

 

[nativewolf]

If you say ‘those celebrating that his TA was nonsense’ got slapped hard, then this morning the ones celebrating that ‘his TA is great’ got slapped hard.

You cannot predict that after a close below 1000 (which 995 was) we will go to 940 and then see the stock rise to 1040 and act as if nothing happened. If someone had shorted TSLA yesterday at close by following his prediction, they would have been stopped out today to avoid a big loss (prudent traders have stop losses). And if we had gone to 1100 this TA guy wouldn’t have said ‘I was wrong’, but would have acted as if nothing happened and said ‘a close above 1100 will mark an end to the down trend’.

I know The Stocks Channel is just one source and investors and traders should use multiple sources of information, but what bothers me is that this channel is being plugged here as the holy grail of TA.

I believe TA has value (if only because people follow it, which makes it a self-fullfilling prophecy), but that doesn’t mean everyone is good at it.

A family friend stock broker, technical analysts guru, committed suicide because he lost someone's piggybank, the third time it happened. Literally spent hundreds of hours with him and other TA. Don't bet all your piggybank is my cautionary advice to anyone looking at TA