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

[MC3OZ]

I need to to "take one for the team" and sell- it always goes up right after I sell!

When everyone here is talking about being which island / mountain to buy, that is the time to sell. (Some)

 

[StarFoxisDown!]

I would be much more optimistic if the heavy volume was on a day where TSLA was outperforming macros. Today’s heavy volume is based on selling pressure, which makes me think some combo of short selling, margin calls, whale(s) selling.

143 million shares (and counting) to send the stock down 3%? No, they be able to drop the stock way more than that if today's heavy volume was just shorting, margin calls, etc. Yeah I don't think so.

There's huge amount of accumulation happening today. It would be much worse if we were underperforming the macro's on such a level at such a low valuation on low or even normal volume. That would tell me there's not a lot of interest from buyers at all. You can't have capitulation with low or regular volume.

 

[H Mak]

My Tesla stock is down well over 1 million and I really am not upset.

Not exactly what I had in mind when joining the Teslionnaire club. But hey, it's catching on

 

[ThisStockGood]

Drop in occassionally to say hi. We'll miss your sense of humor.

View attachment 884558


Only if you sold.

Adjusted for inflation we’re almost at +8 % today. So… I’ll continue my gif making and chill out on this board. In months like these we need a little laugh now and then. That’s my way of thinking at least. And yes, I’m keeping all of my TSLA shares. The path is clear - Tesla is gonna rock the world and it’s just a matter of a few years before everybody will know. It’s an opportunity for investors to say the least. Neither investment advise, nor sarcastic for once

 

[Artful Dodger]

could the FTD's in december, 2021 be vaguely relateted to rebalancing?

If S&P 500 Index funds are net adding shares of TSLA on a rebalancing event, then yes, that could lead to increased Failures-to Deliver (FTDs). This is because those large index funds are Shareholders of Record (registered directly, by name, with Telsa's share agent).

Those funds will not accept failures to deliver (they want their shares), so the MMs and hedge funds would be forced to scramble for other sources of shares to deliver. This could lead to shorting retail, thus increasing FTDs.

 

[tslalala]

This year has had many dark days for us. Just want to say thank you to everyone that has participated in this forum, and many for over a decade. Though we have various disagreements, we are united by TSLA as a long-term investment. You guys have been like a second family to me throughout the years, particularly the most painful years for TSLA.

Things will get better for TSLA. This is not the end for TSLA. Looking forward to another 10 or 20 years with you all during stronger and brighter days ahead! Let's help each other step by step to keep on moving forwards

 

[Drumheller]

Just signed a contract to sell my airplane. Guess what I'll be doing with the money?

Repairing your boat?


Question for the group: could Tesla buy back enough shares to be able to issue a 2 for 1 split without authorizing additional shares?

 

[AndrewZ]

A maniac bear read when CPI numbers are cooling down when everything was +5% premarket seems to me the last attempt to grab every shares they could at the lowest possible price the day before the fed pivots and slows down the rate hikes. Just before the Christmas rally. That’s my theory. Because I really don’t want to see 140s

Slowing down the rate hikes is one thing
Stopping the rate hikes entirely is another thing
Cutting rates is the last thing

Cutting rates will not be a bullish event because it won't happen until the economy is suffering sufficiently, and the rate cuts will be there to ease the pain. What we're seeing right now, in broad terms anyways, are surely not the lowest possible prices while the economy is still running hot and rates are being increased to cool it.

People have this rate stuff all backwards right now, the market will bottom as we get closer to rate cuts

 

[Phrugal Phan]

I want the price to go up, but I am buying a few shares each week, but more than that - in my 457 plan at work I have 2000 shares of TSLA in a brokerage window. I want to do a Roth conversion there, but I have to wait until 2023 to do so. So, part of me wants the prices to go even lower (or at least stay low until I can convert in January), but part of me wants higher prices. I am so conflicted.

 

[M|S|M MYP]

Competition is def coming for real this time:

GM, Stellantis rank as worst automakers for fuel efficiency, even amid EV push, EPA says

Both automakers decreased their fuel economy and increased C02 emissions since the 2016 model-year, as did Hyundai Motor, Mazda and Volkswagen.

www.cnbc.com

https://www.epa.gov/system/files/documents/2022-12/420r22029.pdf

 

[insaneoctane]

Elon agrees:
View attachment 884552

I fully support Elon and am not against the challenging messaging that he is currently undertaking (unlike many in this thread), but today's SP action can't possibly be explained by macro tides any way I try to see it.

 

[unk45]

…. Therefore, FCF surplus coming in every quarter AFTER capex/o. A buyback wouldn't and shouldn't draw down cash. It should be used from FCF surplus on a quarterly basis.

By definition your first statement is false. Whether the source of funds is FCF or borrowed money, share purchases cost money. You’re just staying you think they have too much cash coming in so should spend it.

 

[jerry33]

I wouldn't complain if Tesla did a share buyback, even if it was a minimal one they did selectively when the shorts attack hard. It seems the Tesla board is good at doing absolutely nothing. They should be defending the company and brand in the world arena, yet are silent and actionless.

We had an example a few days ago where a certain famous company bought back a few billions in shares and it didn't move the market. I'd think a small cash dividend might do more because lots of investment and ratings firms like stocks with cash dividends. (I'm not suggesting they actually do that because I think their cash can be used in better ways, just that a dividend would do more for the stock price than a buyback).

 

[MC3OZ]

One has to wonder about morale at Tesla as well. I know a couple of people who work in high-end positions in Silicon Valley, while both probably make a nice salary, they actually make their real money from options given as part of the compensation package. Engineers, as well as others, at Tesla have been working their butts off trying to meet the standards that Elon sets. While that is not unlike other CEO's in tech, watching their net worths get destroyed and having a CEO that is more concerned with other issues (running a social media company) has to be hard on them.

I can only hold out hope that Elon will recognize the impact his behavior is having on Tesla's brand as well as it's impact on morale at the company. Until we get some real solid numbers out of Tesla, I'm afraid this stock is only going to move on fear of what Elon will tweet or do next.

Employees at Tesla know what is coming in future, new products planed factory ramps.

I am waiting for someone to claim that their company didn't buy a Megapack becuase of Elon's Twitter posts. In the case of Megapacks the competition is more competitive.

The best action the board can take now is a buyback, the timing will never be better and the signal is more important than the amount.

 

[betstarship]

Competition is def coming for real this time:

GM, Stellantis rank as worst automakers for fuel efficiency, even amid EV push, EPA says

Both automakers decreased their fuel economy and increased C02 emissions since the 2016 model-year, as did Hyundai Motor, Mazda and Volkswagen.

www.cnbc.com

https://www.epa.gov/system/files/documents/2022-12/420r22029.pdf

Two thoughts:

1. Just wanted to leave this 2024 price target for Ark Invest on Tesla here for discussion (very few paths are straight, up, and to the right): Tesla Price Target: Tesla's Potential Trajectory During the Next Five Years

2. That'd increase market size for EV's quite a bit which Tesla is still a market leader for (market leaders ascribe 10-50% of the market generally)

 

[Gigapress]

If I had a dollar for every post explaining why the stock can't POSSIBLY go below some arbitrary PE that it then goes down below anyway I'd.... probably buy some LEAPs with it.

25 P/E or thereabouts is not very arbitrary because that would take it deep into “value stock” territory. Even with the meager growth predicted by analysts for 2023 that’s put TSLA’s forward PE at about 15. That’s extremely, extremely unlikely.

While it’s technically possible for TSLA’s PE to get this low, that would mean a 1/25 = 4% dividend or buyback could be funded right now with free cash flow even as revenue, earnings and margins have explosive growth trends. Actually it could be even more than that because if Q4 earnings are, let’s say, $1.420 then the current annualized yield would actually be $1.42*4/$80 = 7%. Will the market actually allow that? I seriously doubt it.

The current TTM PE for the S&P 500 is 21 and historically has averaged about 18 since the 1980s. The index is, of course, comprised of a basket of companies with average growth of a few percent per year. Having a PE in the same ballpark would basically imply investors expect Tesla’s earnings growth to barely exceed that of the S&P, and clearly the vast majority of the market does not have that expectation.

S&P 500 PE Ratio - Multpl

S&P 500 PE Ratio chart, historic, and current data. Current S&P 500 PE Ratio is 26.97, a change of +0.01 from previous market close.

www.multpl.com

 

[Buckminster]

Unclear, but over the past 3 yrs @mongo and I have discussed the following theory. For this S&P 500 rebalancing event, the following is at play:

• the S&P 500 index reference date for the Q4 rebalancing was the 3rd Fri of Nov,
• at that time (Nov 18, 2022), TSLA S&P 500 weight was about 1.439%
• TSLA's previous weight for the Q3 rebalance (as of Aug 18, 22) was ~2.096%

Now this next part is conjecture: S&P 500 index funds will rebalance by selling approx 2.096/1.439 = 45% percent of the TSLA holdings over 3-5 trading sessions centered around the rebalance date (Fri, Dec 16, 2022). That's on the order of 100M shares of TSLA.

Most Index Funds will trade (rebalance) at the Closing Cross on Fri, Dec 16, 2022. That makes today's volume (already 136M shares by 2:15 pm) the 'jockeying' before the main event.

Note that I do not KNOW this, and that @mongo has made a strong case that the daily change in index weights due to SP movements naturally rebalances the index. He may well be right, and there is no issue this week.

However, I persist because the available evidence has lead to successful predictions of strong volume on rebalancing days (typically, extreme volume at the Closing Cross on the rebalance date). So again, I don't know, I'm just following the evidence.

So what is the financial motivation for large hedge funds to beat down TSLA ahead of the S&P 500 rebalancing? They know that a large number of shares will change hands in the week of the rebalancing. If they can drive down the SP before the rebalance date, then they create their own bargain price on a large number of shares. All they have to do afterward is take their boot off the throat of TSLA, selling into the rising SP for a tidy and risk-free profit.

Anyway, I predicted this months ago now, so we'll see if events match the theory. But the puppeteers will not be exposed by this little drama, since they pull all the strings (and they own the theatre).

Particular merit - obvs.

New thread:
S&P500 rebalancing and non-index buying/selling

 

[tslalala]

We had an example a few days ago where a certain famous company bought back a few billions in shares and it didn't move the market. I'd think a small cash dividend might do more because lots of investment and ratings firms like stocks with cash dividends. (I'm not suggesting they actually do that because I think their cash can be used in better ways, just that a dividend would do more for the stock price than a buyback).

I like your dividend idea. Most dividend-paying stocks aren't shorted much since the shorts have to pay that dividend, which is a big turn-off for them. Maybe this is another way of relieving the heavy, short selling pressure TSLA is experiencing.

 

[Optimeer]

The holiday update is coming soon! For Non-FSD Cars first, presumably due to some last minute improvements for FSD V11.

https://twitter.com/x/status/1602741827534217217

 

[Thekiwi]

So what are the rules for a company starting a buy back without officially announcing it?

The amount of volume today is the largest volume I've seen since period of the 2020 stock split/S&P inclusion. We're tracking for 160-170 million shares traded today. Something is going on today. There's got to be some big accumulation going.......Tesla might one of the ones accumulating

Already ~$23 Billion worth of shares traded today, even If Tesla blew $5 Billion on buybacks it might not soak up the selling Pressure of a single day like today, let alone a week or month.