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

[StarFoxisDown!]

That page says that those graphs are Hypothetical, not that that is what is planned...

I highly doubt they would even include the graph unless they were actively trying to get to that goal for Q4.

Maybe in in transit only goes from 20k to 30k and then from 30k to 40k in Q1, etc...

 

[StarFoxisDown!]

WS has shown they can ignore it as long as cash is sitting on the sidelines, due to macros. Until all that cash comes flooding back into the market, I think the manipulators can keep us capped in the 200-300 range. Sadly.

My opinion, not investing advice, of course.

My post was more in regard to further PE compression.

 

[Gigapress]

Our Estimates Were Off Mainly Due to Unexpected ASP Decline
Average selling prices and average revenue per delivery declined QoQ. For cash sales with leases excluded, average selling price went from $55.7k to $53.4k, down $2.3k QoQ.

If it had just stayed the same as Q2, Tesla would’ve had about $2.3k * 343.830k deliveries = $0.8B more income, resulting in:

• Auto gross profit excluding ZEV credits at 29.8%
• Revenue at $22.24B
• At 8.5% tax rate and 3.468B shares fully diluted this made a $0.21/share earnings difference
• GAAP EPS to $1.16 and non-GAAP to $1.26

All of the above would've been almost exactly at the TMC averages.

I haven't looked into it more and maybe we'll get clarity on the call, but my guess is this was mainly caused by foreign exchange wackiness and the backlog being so long.

 

[henchman24]

So reading through the later parts of the earnings report, page 21 sure makes it seems like Tesla missing 50% delivery growth for 2022 to be all but a certainty.

It's hard(practically impossible) to determine the numbers of in transit cars from those graphs since there's no numbers on them, but I would guess anywhere from 30-50k cars in transit at the end of every quarter going forward.

So if Q4 production goes as follows :

Fremont 145k
Shanghai 270k
Berlin 42k (3500/week average rate X 12 production weeks with one week for downtime)
Austin 25k (2500/week average X 11.5 weeks of production with 1.5 week for downtime since there's Thanksgiving & Christmas in the US)

We get a total of production of 482k

Take away 40k in transit but add back 20k from in transit in Q3 and we're looking at 462k deliveries for Q4

I guess you could add on another 10-15k of production spread across Fremont/Austin/Berlin if they have limited downtime in Q4.

If we go back to the news right before the P&D report, Tesla was stating a 500k Q4. I don't think that is coincidence. 500k production with ~15k net in transit, basically puts them right at the 50% growth. I expect them to state the goal is 50% delivery growth, but it will be tough. If I was guiding the call, I would state that as the goal while also stating range. Cushioning a 50% potential miss with a we expect a say ~46-54% delivery growth with 50% as the goal would buy a lot of leeway on a slight miss while staying aggressive.

 

[bkp_duke]

My post was more in regard to further PE compression.

I know, was just an off-the cuff remark, as your PE compression made me think of the stock price, and therefore manipulation.


OOOO . . . we have intro music now.

 

[Mengy]

Look, this result are not going to light up the stock tomorrow or next week or for Oct/Nov/Dec.

But I don't know how long Wall St can ignore what Q4 is bringing. Even if you keep margins the same (they won't stay the same since Berlin/Austin are now entering the S part of their production curve which means margin expansion is coming due to depreciation/amortization being spread across more cars), the sheer increase in deliveries and thus revenue (even if they only do 450k of deliveries) is going to cause a huge amount of PE compression in just a single quarter.

Agreed, there will be a breaking point with regards to the PE. I just think it's a year or so away yet.

 

[Words of HABIT]

This quarter is a big reset of expectations due to ending the wave. Future quarters won't look as unusual as this one with so many in transit at the end of the quarter. People will get used to it and won't be surprised one way or the other.

The wave only ends when volumne reaches steady run rate (20M/annually?). Until then, the larger the pond, the larger the wave.

 

[Xepa777]

Tesla needs to come out with a cheaper vehicle. The market for $60,000+ cars is only so large; it's insane that we already sold more vehicles than Corolla globally in September. Can Cybertruck psuh 50% growth YoY? Maybe temporarily. But for mass adoption of electric vehicles globally it's going to require a cheap car, a small compact car that fits international roads better, and a lot of batteries.

Sidenote: ABML (led by ex-Tesla engineer and with a bunch of Nevada Gigafactory OGs now hired) just won a $57 million grant today. People talk about Redwood all the time but what ABML is doing with hydrometallurgical processes for both extraction and recycling is novel and impactful.

 

[StarFoxisDown!]

Agreed, there will be a breaking point with regards to the PE. I just think it's a year or so away yet.

Lol a year?

So what's your EPS estimate for 2023 then? And what do you think the PE will go down to?

Gotta state numbers man if you're going to say a year away

 

[bkp_duke]

Elon - Giga Texas run rate as of yesterday "extrapolated" to 2000/wk.

 

[larmor]

Giga Texas run rate as of yesterday "extrapolated" to 2000/wk.

as of yesterday.... matching Berlin

 

[Mengy]

Lol a year?

So what's your EPS estimate for 2023 then? And what do you think the PE will go down to?

Gotta state numbers man if you're going to say a year away

If we do enter a recession, and if the macros go even lower next year, I think we'll dip between the 40-50 range for our PE in 2023 before Wall Street lets it go up again. If the market turns around then up we go!

Of course this is all my opinion, I certainly don't have a crystal ball or anything.

 

[traxila]

True, but TSLA will likely see 100% over the next few years so...

Key word is ‘likely’. And I did say ‘some’.

 

[MP3Mike]

I'm surprised no one has mentioned that in Q3 they made three times as many 4680s cells as they did in Q2.... (Didn't Troy say that 4680 production had been halted?)

And GigaTexas is supposed to switch the majority of vehicle production to 4680s in the coming months.

 

[bkp_duke]

Elon - Demand:
"We have excellent demand for Q4 and we expect to sell every car we can make for the future, as far as we can see."

 

[Xepa777]

Our Estimates Were Off Mainly Due to Unexpected ASP Decline
Average selling prices and average revenue per delivery declined QoQ. For cash sales with leases excluded, average selling price went from $55.7k to $53.4k, down $2.3k QoQ

If it had just stayed the same as Q2, Tesla would’ve had about $2.3k * 343.830k deliveries = $0.8B more income, auto gross profit excluding ZEV credits would've been 29.8%, and at 8.5% tax rate and 3.468B shares fully diluted would’ve been $0.21/share difference, taking GAAP EPS to $1.16 and non-GAAP to $1.26 which was almost exactly at the TMC average.

View attachment 865490

That's sort of a big miss though, factoring in Forex. You can come up with excuses for every quarter, which I've done in a previous post.

Bottom line, gigantic miss. If Wall Street was off by that much we'd all be ridiculing them for how dumb/corrupt they are, so need to hold it both ways. While it may not be you explicitly who bashes traditional analyst estimates (too lazy to go through individual post history like some vindicitive wackos here), I see a lot of unfair slander thrown at a lot of these analysts. It's a shame the slander that @Troy went through as well. Hasn't he been more right than wrong the past year? Felt like it.

At the end of the day we're all trying to make projections (short or long) to the best of our abilities, and the biases that we may have does not necessarily mean that one person's word is superior to another.

So I hope, moving forward, some respect is shown to everyone (except JPM and Gordon Johnson), about their thoughts. This should be a humbling experience for you, Rob, The Accountant, James Stephenson, etc. who had ridiculously divergent price targets.

 

[elasalle]

BUYBACK BUYBACK 5-10B

 

[juanmedina]

BUYBACK BUYBACK 5-10B

when?

 

[bkp_duke]

when?

2023, pending board approval

 

[Gigapress]

Tesla needs to come out with a cheaper vehicle. The market for $60,000+ cars is only so large; it's insane that we already sold more vehicles than Corolla globally in September. Can Cybertruck psuh 50% growth YoY? Maybe temporarily. But for mass adoption of electric vehicles globally it's going to require a cheap car, a small compact car that fits international roads better, and a lot of batteries.

The 3/Y can be made much cheaper with a litany of slight modifications. Also, Tesla doesn't need to make 30%+ margins. If hypothetically they could sell 4x the volume with 20% margins by cutting the price by $7k, then of course they will do that. 3s and Ys could probably sell 10M per year combined if ASP drops to like $45k.

I think people in general are severely underestimating how much cost can be pulled out of the 3/Y design from fully implementing the savings we currently know about and from deleting luxury features for an economy version. Tesla doesn't necessarily require a whole new car design to achieve this.

Known upcoming savings relative to 2021:

• Front and rear castings
• Labor that is not at SF Bay Area prices
• Structural 4680 battery pack with all the 50%+ cost reductions from Battery Day
• New and improved factory design like Berlin and Austin
• Reduced shipping expenses from simply having more factories with shorter average shipping distance
• No ultrasonic sensing system
• Li-ion 12V battery
• 8 more years of miscellaneous improvements

Economy version savings opportunities:

• Iron-phosphate battery cathode chemistry
• Cloth upholstery instead of premium leatherette
• No seat and steering wheel warmers
• Motor with less than 208 kW power rating
• Traditional sheet metal roof instead of glass
• Wheels smaller than 18 inches
• Front seats with manual position adjustment instead of motors
• Less fancy sound system (not everyone needs 15 speakers)
• Basic side mirrors that don't have motors for folding in and out (or no mirrors at all)
• Basic rearview mirror instead of electrochromic mirror (or no mirror at all)
• Manual steering column adjustment instead of motorized
• No wireless phone chargers
• Smaller console screen

With an economy 3/Y such as this, people could get like 80-90% of the Tesla vehicle experience, and 100% of the safety and standard software features, simply by being willing to sacrifice somewhat on range, powertrain performance, luxury comforts and premium conveniences. Until buying my Model 3, I had never had a car with any of these features. This base version could have 30% gross margin or more, but the premium versions like we have today would still be sold and would still contribute to overall average gross margin being even higher.