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

[Usain]

https://twitter.com/x/status/1767328698351722991

Cool. I'm not interested in buying a Cybertruck right now but given the terms, it's nice to know that they consider me a long-term shareholder.

 

[Usain]

Yeah, it's messed up because a person can have multiple accounts.
One account with 500/500 and you're fine, even if total holdings are 2,000/500 due to liquidating another account with 1,500...

In the eligibility requirements, "brokerage statements" is always plural. So I suspect that they would accept statements from multiple accounts as proof.

 

[Usain]

In the eligibility requirements, "brokerage statements" is always plural. So I suspect that they would accept statements from multiple accounts as proof.

Oh, maybe I see what you are saying, @mongo. You are saying that someone could use multiple accounts to game the system and get a CT they didn't "deserve"?

I guess that's possible, but probably rare and in no way deliberate.

 

[mongo]

Oh, maybe I see what you are saying, @mongo. You are saying that someone could use multiple accounts to game the system and get a CT they didn't "deserve"?

I guess that's possible, but probably rare and in no way deliberate.

I'm not saying they wouldn't deserve it. I'm saying it doesn't make sense for someone who has 500+ shares now to be disqualified because they had more than 2x 500 shares 3 years ago. Especially when having them in two different accounts would have let them qualify.
Single account: 500/500 ok
Single account:1200/500 nope
Two accounts: 600/500 ok and 600/0 not submitted

 

[Singuy]

Yeah, it's messed up because a person can have multiple accounts.
One account with 500/500 and you're fine, even if total holdings are 2,000/500 due to liquidating another account with 1,500...

You can probably submit multiple accounts and they will just count them via total.

 

[mongo]

You can probably submit multiple accounts and they will just count them via total.

Right, but the problem I see is that a person's holdings could disqualify them if all held in one account whereas if they were in two accounts then one of those sub accounts may have qualified.
Just owning 500 shares now and 500 shares in 2021 isn't enough, your account needs to have not had more than 2x the present count.
If a person had 1200 shares in 2021 and now has 500, they'll qualify if those were in two accounts one of which has 500 now and [500 to 1000] then. Otherwise, nope.

 

[heltok]

Yeah, it's messed up because a person can have multiple accounts.

Trying a bit too hard to criticize Tesla imo. Elon trying a random fun gesture without harming anyone. Instead of random scalpers it will be some hodlers. As a non US hodler with day 0 cybertruck reservation I am not mad, at least this is an improvement of the previous situation. IMO Tesla should just have daily auctions of a few founders edition and be the scalpers themselves…

 

[mongo]

Trying a bit too hard to criticize Tesla imo. Elon trying a random fun gesture without harming anyone. Instead of random scalpers it will be some hodlers. As a non US hodler with day 0 cybertruck reservation I am not mad, at least this is an improvement of the previous situation. IMO Tesla should just have daily auctions of a few founders edition and be the scalpers themselves…

I'm not trying to criticize Tesla, I'm saying the rules don't make sense to me.

 

[phantasms]

Cool. I'm not interested in buying a Cybertruck right now but given the terms, it's nice to know that they consider me a long-term shareholder.

I'm tired today so I'm more stupid than usual. [Thanks clocks] Will this absolute nonsense get me my already ordered Cybertruck VIN earlier than Jan-Mar [tic toc people] or would this absurdity give me the ability to convert my reservation into an order if I had reserved far later?

 

[mongo]

I'm tired today so I'm more stupid than usual. [Thanks clocks] Will this absolute nonsense get me my already ordered Cybertruck VIN earlier than Jan-Mar [tic toc people] or would this absurdity give me the ability to convert my reservation into an order if I had reserved far later?

Reservation needed to have been made prior to March 1st. As to how much sooner?

 

[cab]

https://twitter.com/x/status/1767328698351722991

Hmmm, perhaps unfortunate about the "early Cybertruck delivery for long term shareholders"....it, um, implies (IMO) the "take rate" among the masses for the Foundation $erie$ may be starting to taper. It is a decent hunk of change for sure. Yes, I know there are loaded Raptors, etc. that can hit similar price points, but I'm sure they don't sell those as a huge percentage of F150 sales either. This may be in part due to what appears to be a decent ramp-up based on what we are seeing in the GigaTexas drone videos. Regardless, I don't think it would be a good look for Tesla to start selling "regular" versions so soon in terms of the early buyers who likely assumed the first several months would restricted to Foundation vehicles. Admittedly, if they did start deploying the regular versions...the "complaints" of the Foundation buyers would be quickly drown out by the (hopefully) sea of regular dual motor buyers. I do hope there are no issues with the $80K version qualifying for the rebate (i.e. nothing weird with anode parts coming from China hopefully, etc.).

Maybe I'm wrong and this is just about cutting to the chase in terms of interested buyers. If the take rate is lower than expected they may not want folks with high reservation numbers announcing "hey, I'm a million reservations in and they just sent me an an offer for Foundation...looks like almost a million people have passed on it"....the MSM would run with that.

Obviously all of this is speculation...like 98.924% of our posts here.

p.s. it appears I do qualify for this. Like others....a much more appealing prospect when Tesla was at $400...or $350...or well, you get the idea.

 

[⚡️ELECTROMAN⚡️]

 

[Singuy]

Hmmm, perhaps unfortunate about the "early Cybertruck delivery for long term shareholders"....it, um, implies (IMO) the "take rate" among the masses for the Foundation $erie$ may be starting to taper. It is a decent hunk of change for sure. Yes, I know there are loaded Raptors, etc. that can hit similar price points, but I'm sure they don't sell those as a huge percentage of F150 sales either. This may be in part due to what appears to be a decent ramp-up based on what we are seeing in the GigaTexas drone videos. Regardless, I don't think it would be a good look for Tesla to start selling "regular" versions so soon in terms of the early buyers who likely assumed the first several months would restricted to Foundation vehicles. Admittedly, if they did start deploying the regular versions...the "complaints" of the Foundation buyers would be quickly drown out by the (hopefully) sea of regular dual motor buyers. I do hope there are no issues with the $80K version qualifying for the rebate (i.e. nothing weird with anode parts coming from China hopefully, etc.).

Maybe I'm wrong and this is just about cutting to the chase in terms of interested buyers. If the take rate is lower than expected they may not want folks with high reservation numbers announcing "hey, I'm a million reservations in and they just sent me an an offer for Foundation...looks like almost a million people have passed on it"....the MSM would run with that.

Obviously all of this is speculation...like 98.924% of our posts here.

p.s. it appears I do qualify for this. Like others....a much more appealing prospect when Tesla was at $400...or $350...or well, you get the idea.

Tesla have not yet sent the foundation series offer to every reservation holder. This is actually an act to reward long term shareholders who are also diamond handing and loyal. The eligibility criteria is steep. Less than 1% of tesla shareholders has 6 figures in the stock and have not sold over 50% of it at some point. Tesla knows a CT is worth 2x the price aftermarket so demand is unlimited until that resale value drops to retail prices. Because who wouldn't want a car that appreciate 2x at delivery...that's like a 100k gift from tesla.

 

[Dutchie]

Data regarding collisions with EV’s and why repair bills are higher. Some tidbits from the report:
- EV’s tend to be heavier than ICE counterparts resulting in more frequent airbag deployment
- EV’s tend to use lighter materials which need to be replaced more often rather than repaired.

Plugged-In: EV Collision Insights 2023 Year in Review

 

[samn]

I'm really stoked to see this offer! I qualify for this and it feels really good that Tesla is offering this to me, and us, at a time when folks are pulling strings and paying hundreds of thousands of dollars to aquire a Cybertruck.

Unfortunately I'm not really in a financial position to buy a $100k vehicle, but I really want to, and I really appreciate the gesture from Tesla. I guess if I sold enough stock I could do it, but I'm in TSLA for the long term. HODL!

 

[geometro]

Hmmm, perhaps unfortunate about the "early Cybertruck delivery for long term shareholders"....it, um, implies (IMO) the "take rate" among the masses for the Foundation $erie$ may be starting to taper. It is a decent hunk of change for sure. Yes, I know there are loaded Raptors, etc. that can hit similar price points, but I'm sure they don't sell those as a huge percentage of F150 sales either. This may be in part due to what appears to be a decent ramp-up based on what we are seeing in the GigaTexas drone videos. Regardless, I don't think it would be a good look for Tesla to start selling "regular" versions so soon in terms of the early buyers who likely assumed the first several months would restricted to Foundation vehicles. Admittedly, if they did start deploying the regular versions...the "complaints" of the Foundation buyers would be quickly drown out by the (hopefully) sea of regular dual motor buyers. I do hope there are no issues with the $80K version qualifying for the rebate (i.e. nothing weird with anode parts coming from China hopefully, etc.).

Maybe I'm wrong and this is just about cutting to the chase in terms of interested buyers. If the take rate is lower than expected they may not want folks with high reservation numbers announcing "hey, I'm a million reservations in and they just sent me an an offer for Foundation...looks like almost a million people have passed on it"....the MSM would run with that.

Obviously all of this is speculation...like 98.924% of our posts here.

p.s. it appears I do qualify for this. Like others....a much more appealing prospect when Tesla was at $400...or $350...or well, you get the idea.

Yes, this.
TSLA > $350 and I’d be getting one now too.

 

[Webeevdrivers]

Soooo, speculation on wether tesla will best 2 million vehicles this year?

 

[Maarten]

- EV’s tend to be heavier than ICE counterparts resulting in more frequent airbag deployment

Plugged-In: EV Collision Insights 2023 Year in Review

OT:
Hmmm… F = m * a, or force equals mass times acceleration.
A heavier EV will give another lighter vehicle a bigger acceleration in a collision, leading to quicker airbag deployment in the lighter vehicle.

The assumption in that report that frequent airbag deployment of EV’s might be because of them being heavier, is (let me put it friendly) quite counter intuitive to me.

 

[Krugerrand]

Soooo, speculation on wether tesla will best 2 million vehicles this year?

Absolutely.

 

[Zaddy Daddy]

In my humble opinion, the likely GAAP margins can and will fluctuate with numerous extraneous variables (e.g. exchange rates for sales , production, employment) from an operating cash flow basis but not at all from a GAAP basis. For TSLA moire than many others there is variability because they do not directly hedge FX. Part fo that GAAP influence is often negative even when from a cash flow perspective the same effects can be positive. This quickly becomes both arcane, controversial and without enough direct data to resolve the conflicts.

Because of all that I depend far more on Free Cash Flow than I do on P&L. Almost by definition that minimizes volatility, which is the primary source for market maker profits. Consequently it is unsurprising that market makers and securities analysts rarely stray far from the most volatile measures they can find.
Those have a huge profit year right now as Tesla chose to concentrate on efficiency improvements and large capex for new products and new plants.

So long as people can concentrate on GAAP P&L we can be 'happily' assured that the actual FUD looks just like serious and genuine poor financial results. With Germany issues, including sabotage as well as expansion, China issues, primarily expansion and product development, Austin, Sparks, Buffalo, Monterrey, even Lathrop and so on, GAAP is quite likely to be negatively influenced this year while unit volume will not return to high growth until late next year, probably.

All that, and I watch Free Cash Flow. If it can stay positive with all that plus the pricing, supply interruptions and factory stoppage, especially Germany, we will now that Tesla maintains an impressive financial and logistics capacity with all those imply.

Nobody has thus far had too much direct evidence on that metric, just on GAAP P&L and/or auto sales trends.

You made a bunch of assumptions, some of them may very well turn out to be true, others not so much. I do have my opinion about how much value of such mental exercises have, but it's irrelevant to this thread and I'll just keep it to myself.


assumptions

I mean, all valuation attempts use assumptions. At least I lay out some of mine. Most people here don't seem to have attempted a quantitative valuation, but love to criticize those who do - if those number don't say the stock is gonna moon.

You can modify the numbers as you see fit, and have a discussion on why you think yours are more reasonable.

In my humble opinion, the likely GAAP margins can and will fluctuate with numerous extraneous variables (e.g. exchange rates for sales , production, employment) from an operating cash flow basis but not at all from a GAAP basis. For TSLA moire than many others there is variability because they do not directly hedge FX. Part fo that GAAP influence is often negative even when from a cash flow perspective the same effects can be positive. This quickly becomes both arcane, controversial and without enough direct data to resolve the conflicts.

Because of all that I depend far more on Free Cash Flow than I do on P&L. Almost by definition that minimizes volatility, which is the primary source for market maker profits. Consequently it is unsurprising that market makers and securities analysts rarely stray far from the most volatile measures they can find.
Those have a huge profit year right now as Tesla chose to concentrate on efficiency improvements and large capex for new products and new plants.

So long as people can concentrate on GAAP P&L we can be 'happily' assured that the actual FUD looks just like serious and genuine poor financial results. With Germany issues, including sabotage as well as expansion, China issues, primarily expansion and product development, Austin, Sparks, Buffalo, Monterrey, even Lathrop and so on, GAAP is quite likely to be negatively influenced this year while unit volume will not return to high growth until late next year, probably.

All that, and I watch Free Cash Flow. If it can stay positive with all that plus the pricing, supply interruptions and factory stoppage, especially Germany, we will now that Tesla maintains an impressive financial and logistics capacity with all those imply.

Nobody has thus far had too much direct evidence on that metric, just on GAAP P&L and/or auto sales trends.

Yes, and TSLA's free cash flow has plumetted almost 50% in 2023 from 2022. It is up 14% from 2021. TSLA free cash flow yield is 0.77%, that's extremely low.

Tesla Free Cash Flow 2010-2023 | TSLA

Tesla annual/quarterly free cash flow history and growth rate from 2010 to 2023. Free cash flow can be defined as a measure of financial performance calculated as operating cash flow minus capital expenditures. <ul style='margin-top:10px;'> <li>Tesla free cash flow for the...

www.macrotrends.net

My attempts are mostly about trying to understand what the market is going to value TSLA at over the next year or two. In my opinion, that will be based on forecasts they make for maybe the next 5 years at most. People may claim that's "short term thinking", and that's okay, you are welcome to not engage. But I think it's mostly hypocritical because most people are checking the share price daily, making decisions like when to sell for a house downpayment, and are definitely thinking about things in the short term (along with the long).

If Tesla grows 20% annualized production for the next 5 years, then they will be producing 5 million cars annually then. Or if they grow closer to 30%, they will get there around 4 years. That's how I come up with 5 million.

Tesla TTM operating margin peaked between 16-17% I believe during the supply constrained boom in EV prices.

Tesla Operating Margin 2010-2023 | TSLA

Current and historical operating margin for Tesla (TSLA) over the last 10 years. The current operating profit margin for Tesla as of December 31, 2023 is <strong>9.37%</strong>.

www.macrotrends.net

I think it will be hard to get back to those operating margins on automotive without another supply crunch x demand boom. So I estimate 10%. Let's says it goes up to 12%, that's a 50% increase for current levels. Optimistic but maybe possible.

On ASP, I believe I went too low, mistaking what they currently are. ASP is now allegedly $42500. Next gen vehicle will bring that down but not a full $10,000. Let's say $37,500 ASP.

5 million at $37,500 ASP and 12% operating margin = 22.5 billion in net income. At a PE ratio of 40, this supports a market cap of 900 billion, or ~ a $288 share price.

So, I think automotive + energy upside supports a $300 share price eventually. But I don't think it will happen untl Tesla can prove operating margins are trending up to where the market can make such assumptions like 12% operating margins.