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

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I got to take the decision to sell 100 shares of TSLA this week.

Long story short, a guy I trained with met a lawyer who quit his job to fund his business he created with his brother 5 years ago. They accepted a Dragons Den offer of 300k for 30% ownership 5 years ago when their annual revenues was 500k. The valuation was 5M in October 2021 and is now 10M since they signed a 6M contract to sell in the US and are starting their US expansion selling at Costco, Disney, Dollar General. One of the funder has to sell 1% of his 12% stake in the company to invest with his friend in a telemedecine business worth 25M before it fills for IPO next year for a potentiel 1B value. Their gross revenue is increasing 10% monthly and the current consortium holding 75% of the company I am offered to buy 1% plan to sell the company in 4-5 years for 50M valuation realizing a 5x on my initial investment.

He wants to keep at least 10% of his shares in the company so he is offering me to buy 1% of his shares because he needs liquidity in the next week to close the deal with the other company which he accepted to buy 5% 30 days ago.

Would you sell 100 TSLA shares to buy 1% of a privately held profitable company with 120% YoY growth for a potential 4-5X within 4-5 years?

Been in this position, and it all comes down to probability of success of the startup. The one I invested in (pre-series A funding) still has not gone public after 6 years. I wish I had put the money in TSLA instead.

Not advice is do your own homework on the company and be skeptical of claims. Assume anything and everything can go wrong. Assume they are not as competitive in the space as claimed. Etc. Etc. Etc. With that backdrop, then what do you think the return will be?

Not advice, do your own homework.
 
I apologize if this was addressed earlier, but any speculation on when this 3:1 split might happen? Early September maybe?
Like others have mentioned, the split will likely occur by August 31st. This is what they did for the last split and it was to benefit the employees most.

Attached are photos of the Tesla employee stock purchase program. Note these photos are of the older plan, but the recent plan should be about the same:
Screenshot_20220611-161751_Samsung Notes.jpg


Employees can purchase up to 15% of their gross pay

Screenshot_20220611-161759_Samsung Notes.jpg


The second of two offering periods ends August 31.

Screenshot_20220611-161817_Samsung Notes.jpg

The purchase price is 15% lower than the lowest price between the offer period (September 1st, and the purchase date (possibly Feb 26th).

By having the split in effect prior to Sept 1st employees will be able to invest the max amount of dollars up to the 15% gross pay cap under this plan.
 
Like others have mentioned, the split will likely occur by August 31st. This is what they did for the last split and it was to benefit the employees most.

Attached are photos of the Tesla employee stock purchase program. Note these photos are of the older plan, but the recent plan should be about the same:
View attachment 815560

Employees can purchase up to 15% of their gross pay

View attachment 815561

The second of two offering periods ends August 31.

View attachment 815562
The purchase price is 15% lower than the lowest price between the offer period (September 1st, and the purchase date (possibly Feb 26th).

By having the split in effect prior to Sept 1st employees will be able to invest the max amount of dollars up to the 15% gross pay cap under this plan.

What's the minimum notification period prior to a split? After shareholder appoval.

I.e. how BAD can they make the shorts hurt?
 
I got to take the decision to sell 100 shares of TSLA this week.

Long story short, a guy I trained with met a lawyer who quit his job to fund his business he created with his brother 5 years ago. They accepted a Dragons Den offer of 300k for 30% ownership 5 years ago when their annual revenues was 500k. The valuation was 5M in October 2021 and is now 10M since they signed a 6M contract to sell in the US and are starting their US expansion selling at Costco, Disney, Dollar General. One of the funder has to sell 1% of his 12% stake in the company to invest with his friend in a telemedecine business worth 25M before it fills for IPO next year for a potentiel 1B value. Their gross revenue is increasing 10% monthly and the current consortium holding 75% of the company I am offered to buy 1% plan to sell the company in 4-5 years for 50M valuation realizing a 5x on my initial investment.

He wants to keep at least 10% of his shares in the company so he is offering me to buy 1% of his shares because he needs liquidity in the next week to close the deal with the other company which he accepted to buy 5% 30 days ago.

Would you sell 100 TSLA shares to buy 1% of a privately held profitable company with 120% YoY growth for a potential 4-5X within 4-5 years? Is it diversification or worsificiation?

I wouldn't do it. The only privately held stock I'd consider selling TSLA shares for is SpaceX.
 
What's the minimum notification period prior to a split? After shareholder appoval.

I.e. how BAD can they make the shorts hurt?
10 day minimum notification to the SEC I believe.

As Artful dodger mentioned, Tesla’s board can authorize an additional 20% of shares without additional approval and to burn shorts more they could do this and approve an additional surprise split after this upcoming split. After the shares post split pass the $600 mark they could pop a 2:1 split to "burn the shorts".

Probably most effective if that split occurred during the next open enrollment for employee purchase program
 
Looks like EM still shooting for 300K ;)
Just a reminder, Tesla list Fremont capacity at 600k a year and Tesla execs reiterated that when analysts were brought in a couple weeks ago to tour the factory.

So max capacity is 150k per quarter. Tesla had reiterated multiple times Fremont has been running under capacity for a few quarters now. Fremont did about 120k in Q1. I think they’ll at least do 135k, maybe even get somewhat above 140k for Q2.

The best outcome would be that a majority of that increase in production is S/X getting back up to 25k per quarter. Would be big boost for earnings/revenue.
 
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10 day minimum notification to the SEC I believe.

As Artful dodger mentioned, Tesla’s board can authorize an additional 20% of shares without additional approval and to burn shorts more they could do this and approve an additional surprise split after this upcoming split. After the shares post split pass the $600 mark they could pop a 2:1 split to "burn the shorts".

Probably most effective if that split occurred during the next open enrollment for employee purchase program
My assumption is that this is totally in play for splitting prior to Aug 31st (employee ESPP advantages) and splitting again possibly just after AI #2 (currently Sept 30th but originally Aug 19th) if there is a run up and then possibly announcing another share increase if SP has risen again prior to the end of the year due to huge ramp from Austin, Berlin, Fremont and Shanghai. I'm thinking we could see 3 splits this year possibly if there was a supposed 'short burn of the century' part deux.
 
What's the minimum notification period prior to a split? After shareholder appoval.

I.e. how BAD can they make the shorts hurt?
I thought the board might pre-approve the stock split, which might have accelerated the timetable for it to happen, but apparently not. From the filing about the AGM:
"Our Board intends to approve the Stock Split, subject to and contingent upon stockholder approval of the Authorized Shares Amendment."
 
Crikey, that's $10.34/gal US for diesel. :eek:

EVs can not come fast enough.
249.9p/litre in one London garage now. Fuel prices: London petrol station sells diesel at nearly £2.50 a litre

Convert Gas Price = $11.655/US gallon

Stories of low-paid people calling in sick as can't afford fuel.

I spoke to a few people today who wouldn't have considered an EV before. Two seriously considering EVs, one a Tesla, another a Mach-E. They both were aware of high lease prices being offset by massive fuel savings, one is very high mileage. All private mileage, not company - so no reimbursement.

Both would be getting a much more expensive car than they'd normally consider. Briefly showed them car, navigation to cover their regular routes & that Tesla 3 Standard Range could easily cover their travel without Superchargers. I offered test rides at a later date.
 
Considering whether the stock split will squeeze the shorts… some argue that they wouldn’t be so foolish after being burned so badly in the first split. A rational shorter would get out of their positions.

But I wonder. There is so much gloom and doom now and this has been a great year for TSLA shorts. Some bears are predicting TSLA to fall by another 50% or more from here. Greed and reinforcement of negative bias may lead shorts to double down. They may even be telling themselves that the split will be a catalyst for the stock price to fall.

TSLA shorts came back again and again for losses year after year, practically asking for punishment. “Thank you sir - may I have another!” Why would they give up now that they’re on a winning streak?
 
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Understand. Thanks>

I assume these are newly issued shares so in some ways the employees are raising capital at a discount for the company?
They can be newly issued shares, shares held in treasury, or newly purchased from open market within 30 days (generally) of the purchase start date. Looking at the last 3 years there is no obvious spike in trading after March 1 or Sept 1 leading me to believe tesla usually issues new shares. If Tesla had conducted stock buybacks these shares held in treasury could be used instead
 
Tweeted by WholeMarsBlog:

View attachment 815646
“Record production day” for Fremont is different than what was mentioned earlier of “record quarter”… thanks for clarifying.

I don’t mind the short term noise— still lots of demand regardless of Q2 P&D (though I still want it to beat). My bigger concern is the macro environment and Fed hawkishness.