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

[Thekiwi]

Note from the same link:

“In terms of underwriting performance, Tesla Property & Casualty and Tesla General Insurance reported a combined underwriting loss of $30 million in 2023”

Prepare to be told how this is somehow a 4-d chess move from Elon.

 

[Zero CO2]

More on the letter writing campaign Alexandra is coordinating.

https://twitter.com/x/status/1764425180116660320

thanks for this ... my letter is sent .. not sure if the letter will do anything ... i can see a huge pile of unopened letters in the mailroom
I urge folks who care about justice to write a letter this law firm and judge are the worst of the worst ...
useless as tits on a boar , produce nothing of an real value .. it sickens me....

then think they are entitled to $6 Billion in Tesla stock ... and they did not have to suffer the pain we have all endured as HODLers ... no way JOSE

 

[insaneoctane]

That... makes no mathematical sense. If they're asking for 11% of the savings than both the # of options and the original strike cost would be relevant to that. I do think there's a very fair argument to be made about asking for granted shares vs options however, and if it came to it I'd expect Tesla to raise that point as well.

I guess I'm hung up on the fact that until the board and Elon renegotiate the terms of the work that he already provided, we don't know if the lawyers saved the stockholders any money. Seems like a critical piece of the math. I think the original package was absolutely fair for the stockholders, but a judge has decided it wasn't. I do know that all those years of blood, sweat,and tears from the world's hardest working CEO can't possibly be expected to be pro-bono.

 

[Mengy]

I've owned $TSLA since 2018 and today is the first time I've sold due to concerns about the company.

I just don't know how many quarters of limited growth they can post in a row before there is some price compression. They are not priced for minimal growth, not at all. Q1 is not going to blow anyone away, at the very least. I only sold off about 15% and I may buy back if the price drops, which I believe it will.

I'm at a point where I need to see something materially positive in terms of growth or earnings. I don't think the Cybertruck halo effect has been a big as I had hoped. Maybe the Cybertruck ramp will start to move the needle, but this is going to take time. I can't operate on faith or "because Elon" any more. Still long term optimistic, but 2024 is looking rough to me.

I'm fairly sure we'll see either price or PE compression for TSLA this year, and maybe even in 2025. We'll see some growth for Tesla in 2024 but I suspect much lower than most want. TSLA is going to look very unappealing compared to the rest of the Mag 7, in many ways it's performance compared to those other stocks already shows this.

Now, long term, TSLA will be fine and we'll pass our ATH eventually. I simply don't see any catalysts coming in 2024 (and most of 2025) which would qualify to do that though:

- CT won't contribute to revenues substantially until mid-late 2025.
- Semi volume production is still a year or more away from starting.
- FSD is still in beta and Level 5 is still very much an unknown.
- Gen3 isn't going into production until late 2025 at the earliest.
- Production ramp on M3 and MY will be lower than usual for 2024 (and probably 2025 too).
- Margins are low and though they might rise a bit in 2024 we won't be seeing our old margins back anytime soon.
- Our next factory, Giga Mexico, is still 1-2 years from any kind of production starting up.

The few shining lights on our dim short term road could be:

- Megapacks might scale quicker than most expect and could help the fundamentals.
- Optimus progress seems promising, if the market wakes up to the Tesla Bot's potential it could boost TSLA.
- FSD is v12 now, full learning AI, so progress from here on out might accelerate. Maybe. Possibly.

In short I really do think we are in for a year or two of TSLA trading sideways between $150-$250. Long term TSLA will easily pass our ATH of $415 and probably get up to (or surpass) $1000, probably sometime around 2030 or so I'd think.

TSLA share holders can either hold on for the ride or get off the train. Honestly I can't blame anyone for selling TSLA if they lose confidence, HOLDing through the rough periods isn't easy and I'd be lying if I said I hadn't considered selling all my TSLA and going all in on NVDA. It's tempting and much more promising in the short term. I still have faith in Tesla's long term vision though, I think it will one day be the largest company by market cap in the world, so I'm HOLDing.

I might come to regret that one day, but I don't think I will.

 

[SmokyPeat]

Why the heck is Adrian Dittman, ahem, spending so much of his valuable time calling in to the Alex Jones show? I cannot fathom the level of cognitive dissonance required to be fooled by this. It's quite alarming to me. Adrian is not a well man.

 

[Spacep0d]

It takes the ego, audacity, courage, intellect, frenetic pace, and humor of Elon to Elon. If people want normal they can always buy a Ford or Rivian. Tesla would have died without Elon, and big oil would have been glad to kill off yet another EV startup.

 

[SmokyPeat]

If it were some sort of Andy Kaufman-esque joke, I'd be the first to laugh. But this Dittman/Jones thing is actually disturbing.

 

[DarkandStormy]

There will always be some way to play picksy-choosy with which facts are supposedly important to make things look bad. There will always be a factory to look at in isolation and claim production or demand is down. There will always be an isolated market with lower deliveries where somebody will claim "demand issues". There will always be a day or a week or a month where there appears to be some problem if you look at things the right way. There will always be some price drop that can be talked about in the news, while the journalists ignore the huge price increases a year or two prior as though they aren't part of the same equation.

Even though we are all so focused on Tesla, there will also always be more variables and facts that we don't or can't know...so it will almost always be folly to look at a few isolated numbers and jump to conclusions. KNOWING or presenting the numbers is fine...it helps to paint *part* of the picture. But claiming evidence of a problem based on a few isolated numbers, and pushing that as a new truth, seems questionable at best.

Spoiler: Thoughts on what we know and don't know about Shanghai production/deliveries

In this case:
I think we know that Tesla Shanghai takes in battery cells (2170's) from some suppliers and makes their own battery packs.
I think we know that Tesla Shanghai also takes complete or mostly-complete LFP battery packs from suppliers.
Tesla Shanghai uses both sources to build cars in Shanghai.
I believe Tesla also ships some completed battery packs from China to Giga Berlin to be assembled into cars built in Germany.
I believe Tesla has some level of battery cell and/or battery pack production at Giga Berlin, but I have no idea of the numbers.
We also know there were some disruptions to shipping to Germany...but after that, production at Giga Berlin seems to have increased.
We also know there was some "Chinese New Year" celebrations and associated factory downtime in China
I think we also know that sometimes GigaShanghai ships completed cars to Canada, and sometimes GigaShanghai ships battery packs to Fremont.

But, we don't necessarily know if EVERY part of Giga Shanghai and those supplier factories were shut down, or for how long every relevant factory (or part of a factory) may have been shut down.

Likewise, we don't know if Tesla decided to prioritize, for example, shipping more battery packs from China to Berlin or Fremont, instead of using those packs to build finished cars at Giga Shanghai (possibly tied to Lunar New Year celebrations...or possibly for some other reason we don't know).

We also don't know if Tesla may have decided to shift the ratios of which cars from which factories ship to which countries.

There are probably many, MANY other variables we don't know, or haven't even thought about. We have seen it for a decade now, when "analysts" will pinpoint a few numbers to point out some problem. I still remember when analysts used to scream about "Deliveries way down QonQ!" after the first month of almost every quarter...but we all knew it was just Tesla's quarterly delivery wave starting over...and Tesla's deliveries continued to go up quarter after quarter. Again, the isolated numbes are useful as part of a picture...but not useful for drawing larger conclusions about a bigger picture by guessing about the rest of the facts that we don't know.

Not really what I was saying. I was mentioning Jan & Feb 2024 vs 2023 because of the split in the CNY. You can't discount Feb 2024 numbers in China because of CNY while simultaneously celebrating the Jan YoY gain. Just look at it YTD. Tesla sales are actually down in China compared to 2023.

 

[GOVA]

It takes the ego, audacity, courage, intellect, frenetic pace, and humor of Elon to Elon. If people want normal they can always buy a Ford or Rivian. Tesla would have died without Elon, and big oil would have been glad to kill off yet another EV startup.

Quite obvious for some yet so difficult for others to comprehend.

 

[phoggy123]

I'm fairly sure we'll see either price or PE compression for TSLA this year, and maybe even in 2025. We'll see some growth for Tesla in 2024 but I suspect much lower than most want. TSLA is going to look very unappealing compared to the rest of the Mag 7, in many ways it's performance compared to those other stocks already shows this.

Now, long term, TSLA will be fine and we'll pass our ATH eventually. I simply don't see any catalysts coming in 2024 (and most of 2025) which would qualify to do that though:

- CT won't contribute to revenues substantially until mid-late 2025.
- Semi volume production is still a year or more away from starting.
- FSD is still in beta and Level 5 is still very much an unknown.
- Gen3 isn't going into production until late 2025 at the earliest.
- Production ramp on M3 and MY will be lower than usual for 2024 (and probably 2025 too).
- Margins are low and though they might rise a bit in 2024 we won't be seeing our old margins back anytime soon.
- Our next factory, Giga Mexico, is still 1-2 years from any kind of production starting up.

The few shining lights on our dim short term road could be:

- Megapacks might scale quicker than most expect and could help the fundamentals.
- Optimus progress seems promising, if the market wakes up to the Tesla Bot's potential it could boost TSLA.
- FSD is v12 now, full learning AI, so progress from here on out might accelerate. Maybe. Possibly.

In short I really do think we are in for a year or two of TSLA trading sideways between $150-$250. Long term TSLA will easily pass our ATH of $415 and probably get up to (or surpass) $1000, probably sometime around 2030 or so I'd think.

TSLA share holders can either hold on for the ride or get off the train. Honestly I can't blame anyone for selling TSLA if they lose confidence, HOLDing through the rough periods isn't easy and I'd be lying if I said I hadn't considered selling all my TSLA and going all in on NVDA. It's tempting and much more promising in the short term. I still have faith in Tesla's long term vision though, I think it will one day be the largest company by market cap in the world, so I'm HOLDing.

I might come to regret that one day, but I don't think I will.

I've been saying this basic premise now for 6 months. We are in the lull for TSLA and I don't see the market appetite for what TSLA is selling investors. Its version of AI is far more commercialized as a real product than most, but its such a difficult and regulatory fraught product its going to take much longer for Tesla to make money off it than a GPT/LLM/Copilot product.

Tesla is a great company, but TSLA stock is going to trade lower for longer till they show the goods on Megapack, FSD, Next gen car. With The supercharging network opening up, it basically breathes new life into all their competitors, which in the short run I believe will hurt, but in the long run expand the willing TAM for EV's.

Finally I would be in the market for a model X lease, but the numbers seem insane to me. Residuals must be super low given Tesla pricing strategy, because even with the tax credit leasing is unappealing compared to what Rivian is doing on the R1S.

 

[FreqFlyer]

It takes the ego, audacity, courage, intellect, frenetic pace, and humor of Elon to Elon. If people want normal they can always buy a Ford or Rivian. Tesla would have died without Elon, and big oil would have been glad to kill off yet another EV startup.

Just a counterpoint, the above first sentence could be said of Steve Jobs too..............

 

[GOVA]

Just a counterpoint, the above first sentence could be said of Steve Jobs too..............

Not really. Similar but there are a lot of differences which aren’t meant for this particular thread to discuss.

 

[ShareLofty]

More on the letter writing campaign Alexandra is coordinating.

https://twitter.com/x/status/1764425180116660320

When are we starting a letter writing campaign to the Tesla Board to get their act together and to demand new independent directors (not friends and family of Elon)?

 

[2daMoon]

“In terms of underwriting performance, Tesla Property & Casualty and Tesla General Insurance reported a combined underwriting loss of $30 million in 2023”

Hmmmm, I guess its time to sell then? /S

From today's Electrified episode.

 

[MC3OZ]

Written premium is an accounting term in the insurance industry used to describe the total amount that customers are required to pay for insurance coverage on policies issued by a company during a specific period of time

Tesla Insurance Services, which sells insurance in CA, OH, AZ, and IL through a fronting arrangement with State National, has produced $387 million in written premiums, a 78% YoY increase.

Tesla is probably just being paid a commission?

Which is good because:-

In terms of underwriting performance, Tesla Property & Casualty and Tesla General Insurance reported a combined underwriting loss of $30 million in 2023.

They paid out $30 million more in claims than they took in in Premiums... They probably earned some money on the funds in the interim, but rates might need to rise. But perhaps State National is the one actually paying claims?

 

[Knightshade]

Tesla is probably just being paid a commission?

Which is good because:-



They paid out $30 million more in claims than they took in in Premiums... They probably earned some money on the funds in the interim, but rates might need to rise. But perhaps State National is the one actually paying claims?

As I read it the 30 million is the underwriting loss Tesla took in the states where they are the underwriters----Because they call out Tesla Property & Causality and Tesla General there.... as opposed to Tesla Insurance Services, which is what is reselling State Nationals underwriting in the other states (and represents most of the total premium collected too).

 

[Knightshade]

I guess I'm hung up on the fact that until the board and Elon renegotiate the terms of the work that he already provided, we don't know if the lawyers saved the stockholders any money. Seems like a critical piece of the math.

That was a point raised earlier--- The current practical matter is (if the judges decision stands), the money is "saved"-- Any future deal is a new deal...

But if the board were to act quickly and to get shareholder signoff (with proper disclosure as described by the court this time) on an identical replacement package, then Tesla would be in a position to argue the only benefit to shareholders was procedural (getting to vote fully informed) rather than financial--- and thus the attorneys aren't entitled to much beyond the ~1.1 million in actual legal fees they've also, separately, asked for.

 

[AudubonB]

C3 photosythesis is 2% efficient. Currently available solar panels are 20% efficient. That means you need 10x the land to grow algae to get the same amount of energy from solar panels.

Algae is not even close to competitive with solar, but it is a distraction which is all big carbon needs to create doubt/delay with the PR wars. And every time people repeat their nonsence claims without critical review they win a little bit more time for their 'stranded assets': carbon.

My graduate degree in microbiology was funded by UnicornBurpsRUs, so take this with other such lachrymal eructations, but.....

...I wonder if the fact that algae are quite productively able to grow many cells deep in water - ie, have a third dimension of existence whereas a photovoltaic cell is, essentially, one p & n - cell thick, - might queer your dimensional analysis a bit.

 

[2daMoon]

Tesla is probably just being paid a commission?

Which is good because:-



They paid out $30 million more in claims than they took in in Premiums... They probably earned some money on the funds in the interim, but rates might need to rise. But perhaps State National is the one actually paying claims?

It is still early days for Tesla insurance. Is it at all surprising for an upstart company in insurance to show some losses? (I don't know, that's why I ask)

Seems like not too long ago there was a car company facing similar challenges. Then, after several years they reinvented how to build and sell cars profitably, much to the chagrin of the naysayers.

I wonder what could a company like that do with insurance when given time to apply first principles to the challenge?

 

[Artful Dodger]

...I wonder if the fact that algae are quite productively able to grow many cells deep in water - ie, have a third dimension of existence whereas a photovoltaic cell is, essentially, one p & n - cell thick, - might queer your dimensional analysis a bit.

Another problem with cellular photosynthesis is that about 50% of the primary energy obtained is used for cellular respiration. The advantage of silicon is it doesn't eat or breathe.

Note that there are triple-junction photovoltaic cells, which are build in layers each optimized to absorb a different wavelenght of light (addressing the band gap issue). Better performance and efficiency, but much more expensive. Typically only used in spacecraft, but not economical on Earth where you can just buy 3x the panels for 1/15th of the price.