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

[wipster]

Thank you Alphacrux for posting this. I found it very interesting and telling that the Toyota dealer in Florida drives an S Plaid! I wonder how many at non-Tesla manufacturers also drive Teslas?

Don't know about that, but we have one Mitsubishi and Lincoln dealer in town that has 17 used Teslas, mainly 3 or 4 year old 3's, so I'm pretty sure they're driving one home on a nightly basis!

 

[MABMAB]

But they haven't recognized any revenue from giving it to 100k testers so far. Why would giving it to ~60k more result in any recognition? And they said that they wouldn't until it is available to everyone in a given region that has the hardware and has paid for it. So all of those articles are likely wrong. I expect zero extra revenue recognition in Q3.

From the 2021 Q3 call:



So let's check the conditions:

• Still in beta? Yes.
• Still invitation only? Sounds like not really.
• Still limited? Yes. (Still restricted based on opting in to Safety Score and earning a score of 80+.)

So it seems to me like they still won't recognize it. But there is some wiggle room there.

I applaud your attention to detail!

 

[jkirkwood001]

Legitimately I don't know how anyone can be upset with the performance over the last month plus. Market has decided to test lows of May and July (sans a day or two) with threats of June... and Tesla is pretty much at its high for the last few months. Basically at the level of the full breakdown point of May 5th.

If the macro shows really any sign of getting going... Tesla will take off.

Eh the stock is doing fine in the face of some nasty macro action. However, I do think at some point over the next 2 weeks, we'll have a period of significant underperformance. You know Wall St isn't going to let TSLA outperform like this all the way to P/D numbers and especially not Q3 earnings.

TSLA is the only stock in the top 12 globally to be green over the last 30 days (and green by something like +5%):

(source)

 

[PeterJA]

It was running up into earnings last year and then earning blew the lid completely off....

Yes, the lid blew half-off after the P&D report last year, according to Yahoo's TSLA chart.

Less than two weeks to go now.

 

[MartinAustin]

I put a buy order in yesterday for $300. Perhaps I have missed the boat? With resilience like this, imagine what TSLA will do if good news gets released. E.G. Q3 the delivery announcement... weekend of October 1st/2nd? (8 more trading days until then)

 

[Nocturnal]

Agree, it obviously stiches things together with tenuous, if any, real connection in order to paint a picture that is probably not representative of the message conveyed by management to employees about what is expected of them.


OK, then, it sounds like you are saying the hit piece worked on you.

It would be correct to fire anyone with a history of harassment that was supported by multiple observations. However, I would hesitate to fire even a minor employee because someone claimed they said something that was denied by the accused and without other witnesses or any recording or other evidence.

Well, I think it's rational to say that something can both be a hit piece and that Tesla might have made mistakes in this area. Has it been fixed? I sure hope so. (and obv due process needs to be followed)

 

[StarFoxisDown!]

What Ford guided really isn't in line with a 12.5% drop.. market going a bit bonkers there. Not a company I'd invest in, but events like that get my trading account's ears.

Eh not really. If you believe Fords sticking to the guidance is truthful, then sure it's an overreaction.

But the realities are that Ford isn't going to hit that guidance. They know it. Wall St knows it. And funds know it. Ford's just trying to have this not be a total disaster by showing confidence in reiterating guidance even though they know they won't hit it.

Then you take into account the Fed is sending the economy into a recession where ASP is going to drop materially for new vehicles. We're already seeing ASP drop for new vehicles. Unlike Tesla, who enjoys a backlog of orders which translates to pricing power, and AND a very big margin cushion (likely to get an more cushion once we get Q3 earnings), Ford small profit will be gone very quickly.

The markets looking ahead to Q4 and a recession and making (what I believe are accurate) assessments of Ford's situation right now

 

[henchman24]

Yes, the lid blew half-off after the P&D report last year, according to Yahoo's TSLA chart.

Less than two weeks to go now.

Yeah the run into earnings after P&D was one of the strongest in Tesla's history... then blowout earnings gamma squeezed the whole thing. Entirely possible that happens again.

 

[ZeApelido]

As certain participants have pleadingly informed, there are dedicated FSD threads. Use them.

Yeah but have you tried reading threads in "AI, Autopilot, & Autonomous/FSD" ?

All threads end up just with continuous snarky comments about Elon promising robotaxis years ago.

I want to tear my eyes out whenever I tried to read them.

I wouldn't wish forced reading upon my wost enemy.

 

[traxila]

All I know is, in times past, a run up the likes of which TSLA has had the past month compared to macros, greeted with new stories of ingrained corporate sexual harassment and corresponding lawsuits, in addition to news about a Tesla battery going APOCALYPTIC would result IN MASSIVE SELLING especially in a down market, to the tune of 5% to 10% negative at least!

Instead, as of 3:22pm I see green while the QQQs are down 1%.

What does this mean? Feels like a big move is going to happen up or down soon. Probably both.

 

[henchman24]

Eh not really. If you believe Fords sticking to the guidance is truthful, then sure it's an overreaction.

But the realities are that Ford isn't going to hit that guidance. They know it. Wall St knows it. And funds know it. Ford's just trying to have this not be a total disaster by showing confidence in reiterating guidance even though they know they won't hit it.

Then you take into account the Fed is sending the economy into a recession where ASP is going to drop materially for new vehicles. We're already seeing ASP drop for new vehicles. Unlike Tesla, who enjoys a backlog of orders which translates to pricing power, and AND a very big margin cushion (likely to get an more cushion once we get Q3 earnings), Ford small profit will be gone very quickly.

The markets looking ahead to Q4 and a recession and making (what I believe are accurate) assessments of Ford's situation right now

I'd say it is more likely than not Ford goes back above 14, maybe 14.50 within the next 10 days as things are digested. An 11+% drop over what they have guided is way too much. Markets overreact all the time... this was a 4-5% drop event. If Ford' FCF stays positive in this quarter, they'll be back above 15.

 

[H Mak]

With a PE below 4.5 and dividend around 4.5%.....I guess the market is really spelling out doom here for F.

Market Cap of F and TSLA exactly 10 years ago:

F: $39B
TSLA: $3B

And today:

F: $52B
TSLA: $968B

Looks like the market has been pretty good at spelling for some time now

 

[wipster]

Yes, the lid blew half-off after the P&D report last year, according to Yahoo's TSLA chart.

Less than two weeks to go now.

Yeah and at this time last year, it closed at about 50 points lower than today, so we've got a bit of a head start! Come on two weeks!

 

[StarFoxisDown!]

I'd say it is more likely than not Ford goes back above 14, maybe 14.50 within the next 10 days as things are digested. An 11+% drop over what they have guided is way too much. Markets overreact all the time... this was a 4-5% drop event. If Ford' FCF stays positive in this quarter, they'll be back above 15.

But again, I think this is the market looking forward into next quarter with those dynamics I mentioned. Ford, like all of legacy auto, has been throttling production to keep ASP artificially high because that's the only way they can show a profit nowadays. That has worked during this period of pent up demand because of lack of supply.

But if a recession happens, Ford doesn't have the organic demand to keep ASP's at their current levels and will have to lower ASP significantly and there goes all of Ford's profits and cash flow. The signs are all there that Ford, and all of legacy auto, is about to go through a very rough stretch.

 

[Rammstein]

I might get in trouble for this but I want to call it. I think there is a good chance that the FSD software that is better than a human will be called 10.69.420. I’m betting that will be the version that goes wide release and with that comes all that juicy differed revenue. This will surprise Wall Street and send TSLA to mars!

 

[TheTalkingMule]

What Ford guided really isn't in line with a 12.5% drop.. market going a bit bonkers there. Not a company I'd invest in, but events like that get my trading account's ears.

Not to go all tinfoil hat, but what a strange coincidence we see Ford getting crushed the day before the Fed announcement.

Nothing has gotten more attention from the federal side than Detroit. And we have elections right around the corner.....

 

[Artful Dodger]

I put a buy order in yesterday for $300. Perhaps I have missed the boat? With resilience like this, imagine what TSLA will do if good news gets released. E.G. Q3 the delivery announcement... weekend of October 1st/2nd? (8 more trading days until then)

Haha, don't FOMO before the FOMC meeting tomorrow...

 

[henchman24]

But again, I think this is the market looking forward into next quarter with those dynamics I mentioned. Ford, like all of legacy auto, has been throttling production to keep ASP artificially high because that's the only way they can show a profit nowadays. That has worked during this period of pent up demand because of lack of supply.

But if a recession happens, Ford doesn't have the organic demand to keep ASP's at their current levels and will have to lower ASP significantly and there goes all of Ford's profits and cash flow. The signs are all there that Ford, and all of legacy auto, is about to go through a very rough stretch.

Forward looking as in the vehicles impacted here and will hit the profits are the extra high margin vehicles with pretty much unlimited demand (F150s). So when the parts get in, Q4's numbers should be significantly better.

Ford has quite a lot of organic demand. They make their business off the back of the F150 and SUVs where they tend to dominate the truck market while holding their share very well in SUVs. Plus their credit business tends to be one of the strongest of all the legacy automakers. People really underestimate how strong Ford's truck business is right now.

I think looking 18+ months from now, Ford has a rough road... especially if you go 5+ years where a decent chance of bankruptcy exists. Which is why I said I wouldn't invest in them. Trading off this news... I'm nibbling. That was too drastic of jump for what was reported. If the macro is stable to up, Ford recovers this drop in short order. If their quarter shows strong cash flow in spite of this (and decent chance of that), they'll be back above 15.

 

[Singuy]

I'd say it is more likely than not Ford goes back above 14, maybe 14.50 within the next 10 days as things are digested. An 11+% drop over what they have guided is way too much. Markets overreact all the time... this was a 4-5% drop event. If Ford' FCF stays positive in this quarter, they'll be back above 15.

They also guided a reduction in production by over 50k this Q. Looking at their net income historically, 1B in expenses will either take all their profits and drive them to the negative this Q or at best case it's a 50% drop in earnings.

Another issue is that supply chain cost increase is kind of sticky. It'll take a few quarters before it unwinds. So either Ford start rising prices to compensate or else it'll be a brutal Q4 as well as every car manufacture ramps up for Q4.

 

[henchman24]

They also guided a reduction in production by over 50k this Q. Looking at their net income historically, 1B in expenses will either take all their profits and drive them to the negative this Q or at best case it's a 50% drop in earnings.

Another issue is that supply chain cost increase is kind of sticky. It'll take a few quarters before it unwinds. So either Ford start rising prices to compensate or else it'll be a brutal Q4 as well as every car manufacture ramps up for Q4.

I'm not stating that the news was good... stating that the market has gone too far. They stated 40-45k this quarter of vehicles on wheels are missing some components that they anticipate will ship in Q4. They maintained full year guidance.

That basically will wipe out their profits for this quarter, but being forward looking, should mostly be recouped in Q4. With the vehicles hit, Ford has options with pricing... but the truck market is so strong that they are likely to be able to raise prices.