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

[Nocturnal]

So we have to wait until Sept 21 for the FED to tell us that they are only raising .50 and for the market to bounce? Sigh.

 

[Words of HABIT]

Two or three quarters is a flash in the pan to an investor with conviction. I would wait more than 2 or 3 years for TSLA to start appreciating again (as long as the fundamental reasons I bought the stock remain intact) but that's not going to be necessary. I can't say that as a fact, but I can say it with conviction. Conviction should never be blind; it should always be based on real things.

In 1997 I started buying QCOM with the conviction they held the keys to high-bandwidth cellular data. Cellular data was, at the time, slower than molasses and as expensive as caviar. People actually thought the common person didn't need high-bandwidth cellular data. I knew they wanted high bandwidth cellular data; they just didn't know it yet.

In 1998 QCOM went down, not up. It made no sense as Qualcomm was profitable and growing. So, I bought more. It got cheaper still! It was about 30-35% cheaper than the very low price I had already Identified as a bargain even though adoption of Qualcomm's technology was growing rapidly and proving its abilities in the real world with millions of users. I even sold highly appreciated MSFT stock that still had a bright future to buy more QCOM. It was our biggest position of just a handful, by far. Then we moved into our tiny uninsulated summer vacation cabin in the neighboring County, sold our real house (that we owned outright) and put 90% of the proceeds into more QCOM which showed no signs of life if all you looked at was the market price. In the spring of 1999 Ericsson settled out of court with Qualcomm and the stock quickly doubled. I watched with mild amusement as greedy people, not wanting to lose their unrealized profits, sold for two, three or four times what they had originally paid. They thought payday had finally come! Over the next 9 months QCOM continued to appreciate until it was worth 36 times the doldrums of 1998. Every $100,000 invested had turned into $3.6 million. I didn't sell a single share until the day before it peaked, the last trading day of 1999. This is what I had waited 3 years for, and it was worth the wait! Investing is not for the impatient or those quick to take profits. That said, I am not expecting TSLA to perform just like that! But the longer the price is held down, the more it will resemble a rocket ship again. If markets were not so spastic, TSLA would more closely resemble a locomotive of the kind that steam-rolls your way to great wealth. Instead, it goes in unpredictable and irrational fits and spurts that have little to do with the actual value of the company.

Always judge the value of a company by your own analysis, not the current share price or recent share price movements! That's how you lose. And remember that 2 or 3 quarters in the investment world is like 5 minutes to a day trader. Don't invest with impatience - that's not how you become wealthy Manipulators rely on other's impatience to finally get their way. And never sell a stock simply because it doubled or tripled quickly, only sell because it has become abundantly clear the future of the company is not bright enough to justify the price. Even then I would caution against selling too soon as momentum and market FOMO will typically push the price far higher than it has any right to be. If the company is as good as your analysis showed, it will likely be OK to hold through a multi-year period of doldrums if you get caught in the downdraft that stagnates for a multi-year period. Ideally, you would sell before such an event but it's almost always better to hold too long than to sell too early (unless the company has no substance or staying power).

I would argue that TSLA, as a long-term, core holding, is undervalued at more than triple the current price even if I assume FSD will never work. And that's an assumption I'm not willing to make.

@Stealth, informative post. Curious why you sold QCOM last trading day of 1999, instead of first trading day of 2000 to defer the capital gains tax by a full year.

 

[traxila]

So we have to wait until Sept 21 for the FED to tell us that they are only raising .50 and for the market to bounce? Sigh.

Think next CPI coming in cold might do it. For a while anyway.

September 13th.

QQQs down 8% in five days. Down around 27% from all time highs. These are mostly big bellwethers in that category. Easy to find stocks down 70 to 90%.

Not sure where people who are selling now expect a bottom, but I guess a lot lower. QQQs Down fifty percent with all the stocks now down 70% simply vanishing? Makes no sense.

 

[2daMoon]

getting close to 800(266.67) pre-split.
before 800 (round #) would have been support ...

I ain't skeered!

But, I ain't standin' too dad gum close to that spring either.
Still love listening to the tink, tink, tink sounds as it winds up.

 

[wtlloyd]

@Stealth, informative post. Curious why you sold QCOM last trading day of 1999, instead of first trading day of 2000 to defer the capital gains tax by a full year?

Lol, how soon we forget! Reference "Y2K Bug".

 

[Featsbeyond50]

NVDA down over 11%.

 

[generalenthu]

German electricity prices normalizing though still a ways to go.

 

[WattsHappening]

Really looking forward to the long weekend and an end to the 'summer doldrums.'

I'm really surprised at the low trading volume since the split; we need volume! It's really tiring and discouraging watching the SP be driven by day traders and hedge funds. Perhaps the big boys coming back from the Hamptons will bring some support.

I shouldn't care as I am mostly a HODLer and am not planning on selling anytime soon. But I do have some Jan and Mar 2023 calls that I bought a year+ ago that I expected would be worth a heck of a lot more at this point. Sigh...

 

[unk45]

Buffalo GF is pretty close to Ontario Canada

The part of Ontario to which Buffalo is 'pretty close' includes the majority of Canadian Auto industry support. There is FWIW, a statue of N. Tesla in nearby Niagara Falls, ON

http://www.teslasociety.com/victoria.htm

From the earliest municipal electricity until now the region has been among the most innovative anywhere. Of course it does not have the cachet of Silicon Valley. Tesla supplier Corning's Gorilla Glass inspired Tesla Armor.
The value of manufacturing in this area on a larger scale builds conveniently on the foundation of Tesla Buffalo, which has worked out well even though Tesla had no part in the pre-acquisition site selection.
Whatever happens will be very interesting. Dahn and Hibar are far from the only excellent resources.
Conveniently placed for snow and ice studies too, although Buffalo/Niagara Falls probably have the definitive track record on that subject.
Note: I do remember walking in snow tunnels that linked a college campus in the area. I also remember academically rigorous experiences.

 

[The Accountant]

To add onto my own post, I’m seeing 85k referenced as production for Aug. That was pretty much my expectation. So a production surplus of 8k.

Now the question is, what happened to the surplus of I believe it was 8-10k of production from July? I would have assumed that surplus would have flowed through to the export/local sales numbers for Aug. Which was why I was expecting the CPCA number to come in between 80-85k. That 8-10k has to show up in Sept + the 8k production surplus from Aug.
So……bare with me here, Sept CPCA number could come in at 100k . I know that sounds impossible, but for the full month of production for Sept, I think 90-95k is reasonable to expect.

So 90-95k of procuring in the last month where most production actually gets sold through to local sales + 8-10k surplus from July + 8k surplus from Aug = 106k for Sept CPCA.

@The Accountant what are your thoughts on this. I’m remembering the July production surplus correctly right? Those produced cars have to show up sometime before end of the quarter.

It also jibes really well with the delivery time drop for China. If they’re trying to sell 100k vehicles in China alone in a single month, that’ll definitely bring down the wait time temporarily

yes - your memory is correct. In July Shanghai produced 39k and delivered 28k thus entering August with 11k in inventory.
I believe that they also produced more vehicles in August than delivered - maybe they now have 15k in inventory.
Where are these cars? On there way to local customers in China. When local deliveries start in China, Tesla uses the China Wave - delivering first to the customers further away from Shanghai and eventually delivering to customers in the Shanghai area by quarter end. Similar to how Fremont ships first to the East coast and then the last deliveries in the quarter occurring in California. China's a big country and the inventory at Aug 31 is in transport.

 

[SOULPEDL]

China is sterile while most Americans are not. Letting in the flood gate of omicron will destroy their Healthcare system when it's already massively over capacity already.

China has 4x the population with most in heavy density areas. I think people need to be a little more empathic to different circumstances. (Also I caught covid and I can see how it's no joke for the elderly).

My wife and I were just discussing this perspective earlier along the same lines. I don't think we should underestimate the economic impact of people dying in large numbers in a short period of time on China's economy. On the surface it's not the route most here would take, but we don't have their numbers either. In a 4x population density, it could just boil down to the math for deciding on really bad vs even worse. But at some point, hopefully soon, they allow some nature to process it all for better immunity so the shutdowns are no longer needed (but not to get into any medical discussion here).

 

[ZsoZso]

The jig is up folks. They figured out why EVs suck. Time to sell.
View attachment 847856
Had to share. I figured everyone could use a good laugh this morning.

OK, but how much is to replace a non-functional brain ?
That's the cost these people should worry about...

 

[M|S|M MYP]

OK, but how much is to replace a non-functional brain ?
That's the cost these people should worry about...

Neuralink fixes this

 

[Singuy]

NVDA down over 11%.

Today's market reaction has more to do with increase tensions with China plus overreach by our government than any kind of material affect on Semis. These sanctions are more symbolic in nature because the US just made India the middle man for exporting purchased A100 gpus into China.

 

[Artful Dodger]

Nvidia now down over -11.8% on news that the U.S. government intends to restrict the company from selling its A100 GPU to China:

NVIDIA Corporation

NVDA

1.133888

133.07

-17.87

(-11.84%)

These are the same tensor core GPUs that Tesla uses in its data centers for neural network (FSD) training, as it continues to develop its own in-house DOJO supercomputer.

Tesla Unveils Supercomputer Powered by NVIDIA GPUs | NVIDIA Blog

Tesla introduced the in-house GPU cluster the automaker is using to train deep neural networks for Autopilot and self-driving capabilities.

blogs.nvidia.com

Tesla recently announced it would purchase an additional 7,000 A100 chips this year. Presumably, the price just went down, or the order quanity just went up (more likely the latter, if Tesla's history is used as our guide).

At any rate, we can be quite certain that neither Ford nor Toyota will be picking up any cheap GPUs (or designing their own supercomputer).

Cheers to the Longs!

 

[StarFoxisDown!]

yes - your memory is correct. In July Shanghai produced 39k and delivered 28k thus entering August with 11k in inventory.
I believe that they also produced more vehicles in August than delivered - maybe they now have 15k in inventory.
Where are these cars? On there way to local customers in China. When local deliveries start in China, Tesla uses the China Wave - delivering first to the customers further away from Shanghai and eventually delivering to customers in the Shanghai area by quarter end. Similar to how Fremont ships first to the East coast and then the last deliveries in the quarter occurring in California. China's a big country and the inventory at Aug 31 is in transport.

Yes that was the logic I was using in terms of how China delivery waves work.

I just wanted to double check my numbers/logic before I started shouting to the heavens that Sept will be a 100k number that will shock practically everyone. Still need to wait to get confirmation on that 85k production number for Aug though. The production number for Aug is really key here. If it's 85k with 7 days of the Model 3 line being shut down +2-3 days to ramp that line up.......then I don't see how 92-95k production for Sept wouldn't be the expectation.


Dear God China please don't screw this up with covid lockdowns again (though I do think Tesla is a lot more prepared this time)

 

[insaneoctane]

The jig is up folks. They figured out why EVs suck. Time to sell.
View attachment 847856
Had to share. I figured everyone could use a good laugh this morning.

To be apples to apples, she should have compared the price of an EVs battery to the ICEV's gas tank...that's at least $200-$300....

 

[Electroman]

In 1998 QCOM went down, not up. It made no sense as Qualcomm was profitable and growing

OT: I have the same conviction with Snowflake. Lets see if it pans out.

 

[insaneoctane]

Not to look a potential gift horse in the mouth, but I wouldn't want TSLAs impending breakout, that we are so so anxiously awaiting, to occur under the weight of this market downturn. Seems like we'd get way more pop/FOMO in a neutral or certainly recovering market....

 

[Lance Boyle]

The part of Ontario to which Buffalo is 'pretty close' includes the majority of Canadian Auto industry support. There is FWIW, a statue of N. Tesla in nearby Niagara Falls, ON

http://www.teslasociety.com/victoria.htm

From the earliest municipal electricity until now the region has been among the most innovative anywhere. Of course it does not have the cachet of Silicon Valley. Tesla supplier Corning's Gorilla Glass inspired Tesla Armor.
The value of manufacturing in this area on a larger scale builds conveniently on the foundation of Tesla Buffalo, which has worked out well even though Tesla had no part in the pre-acquisition site selection.
Whatever happens will be very interesting. Dahn and Hibar are far from the only excellent resources.
Conveniently placed for snow and ice studies too, although Buffalo/Niagara Falls probably have the definitive track record on that subject.
Note: I do remember walking in snow tunnels that linked a college campus in the area. I also remember academically rigorous experiences.