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Tesla, TSLA & the Investment World: the Perpetual Investors' Roundtable
- Thread starter AudubonB
- Start date
I don’t know why ARK thinks tesla will sell most robotaxis to fleet operators when we already have so many millions of robotaxis on the road today just waiting for that one software update to unlock massively increased utilization, generating revenue for owners while they work/sleep, etc
You stole my thunder here.
All the screaming, hair-pulling, and gnashing of teeth this year!
It's still 2024, folks. We were warned to expect very little growth as all these new seeds keep sprouting for the next harvest.
Someone still vaguely in authority indeed said something about that in the Q4 call.
Just remember, Tesla grows at a rate several orders of magnitude slower than you can post, or read FUD. But grow it shall.
--Growler out
Confessions of a Tesla skeptic…..
Before I start- Is there a creed for bears that will make them acceptable around here? I get how obnoxious the naysayers can be. I probably won’t post often, but how about this…
I commit to:
Good Lord, I’ve been trying to slay this white whale for years……kept the bets small, and cut my losses when things went against me (and did they ever, as all the bulls who’ve 10X’d, 50X’d, can attest). Yes, I’m one of those guys you were ridiculing as you were getting rich! Anyway, as of today I’ve crawled back to break-even on this crazy journey. Considering how wrong I was about Tesla auto demand in 2018, I consider myself fortunate.
Here is how I see things now, given the narrative has suddenly shifted to FSD, Optimus, and Robotaxi (Energy I will put aside for the moment).
In each case Tesla faces deep-pocketed, highly motivated competitors as well as massive regulatory hurdles (at least for true FSD and Robo). And while Tesla has great tech for a car company, I’m skeptical that they have great tech compared to a true tech company.
The crux of the bear case is well known; assuming the car business is worth maybe $50-100B, the additional ~$450 B in market cap requires that in at least one of these 3 projects, Tesla must achieve three very difficult things:
1) beat the competition to the goal;
2) make big margins; and
3) convince the market these margins won’t be competed away, which is necessary to keeping a lofty P/E ratio.
I just don’t believe they will thread ANY of these needles. As an example, am I wrong in stating that every new auto safety feature has eventually become standard, and basically free? So even if Tesla beats the competitors to true FSD, how long would they be able to make real money on it?
Worse, IMO, is the risk / reward being offered here. What I view as moonshots, the uber-bulls view as sure things; and the stock is priced accordingly. I would gladly buy Tesla at a $50B market cap, with all that upside if the moonshots pay off. What I can’t see is a $550 B valuation, which prices in at least one of these moonshots hitting. It’s like drawing to an inside straight and only getting even-money on it.
(Heltok, that’s a nod to you. I remember you from 2+2).
To all this, the obvious retort is: ‘Tesla faced equally imposing obstacles in 2018 and overcame them. They will do it again.’ That’s fair. It may even be true. There’s no denying Musk’s genius and track record. That’s why this is just a 3% position for me (January 2026 $150 puts). It’s enough to hurt if I’m wrong, but not enough to cause major damage.
Why January 2026? I’m predicting the market loses patience after multiple quarters of mediocre profits. Assuming even $3 EPS for ‘24/’25, maintaining a 60X ($180 SP) multiple seems implausible to me.
My biggest risk, besides being wrong, is that the market gives grace to Tesla for longer than I think it will. Musk is without parallel in marketing his vision and is backed by an army of devoted retail shareholders. Maybe they CAN keep the stock up here for years at 60X.
So that’s basically it; full disclosure. Why do I hang out here? The Tesla / Musk saga is the most fascinating financial story I’ve seen in decades. Who can resist the drama? Also, I enjoy this board. I lurked here for years before registering. I understand the bull case; and have nothing against the bulls. The euphoria around here a few years ago must have been life-altering! I’m happy for anyone to have done well in the stock market (FWIW, also, my bet here is completely against type; I’m a true buy-and-hold Buffett / Munger type guy. Which is probably why this won’t work out, lol).
Thanks for hearing me out.
P.S. If you want to improve your investing (and be highly entertained), check out the Corner of Berkshire and Fairfax. Lots of good spirited, healthy back-and- forth on individual stocks. Really good analysis and stock ideas. No, I have no financial interest in the site. I’ve gotten some great stocks from it though.
Before I start- Is there a creed for bears that will make them acceptable around here? I get how obnoxious the naysayers can be. I probably won’t post often, but how about this…
I commit to:
- try to bring some humor to my posts.
- not post on down days.
- cheerfully admit it if I’m wrong - and congratulate the bulls.
- not gloat if I’m right.
Good Lord, I’ve been trying to slay this white whale for years……kept the bets small, and cut my losses when things went against me (and did they ever, as all the bulls who’ve 10X’d, 50X’d, can attest). Yes, I’m one of those guys you were ridiculing as you were getting rich! Anyway, as of today I’ve crawled back to break-even on this crazy journey. Considering how wrong I was about Tesla auto demand in 2018, I consider myself fortunate.
Here is how I see things now, given the narrative has suddenly shifted to FSD, Optimus, and Robotaxi (Energy I will put aside for the moment).
In each case Tesla faces deep-pocketed, highly motivated competitors as well as massive regulatory hurdles (at least for true FSD and Robo). And while Tesla has great tech for a car company, I’m skeptical that they have great tech compared to a true tech company.
The crux of the bear case is well known; assuming the car business is worth maybe $50-100B, the additional ~$450 B in market cap requires that in at least one of these 3 projects, Tesla must achieve three very difficult things:
1) beat the competition to the goal;
2) make big margins; and
3) convince the market these margins won’t be competed away, which is necessary to keeping a lofty P/E ratio.
I just don’t believe they will thread ANY of these needles. As an example, am I wrong in stating that every new auto safety feature has eventually become standard, and basically free? So even if Tesla beats the competitors to true FSD, how long would they be able to make real money on it?
Worse, IMO, is the risk / reward being offered here. What I view as moonshots, the uber-bulls view as sure things; and the stock is priced accordingly. I would gladly buy Tesla at a $50B market cap, with all that upside if the moonshots pay off. What I can’t see is a $550 B valuation, which prices in at least one of these moonshots hitting. It’s like drawing to an inside straight and only getting even-money on it.
(Heltok, that’s a nod to you. I remember you from 2+2).
To all this, the obvious retort is: ‘Tesla faced equally imposing obstacles in 2018 and overcame them. They will do it again.’ That’s fair. It may even be true. There’s no denying Musk’s genius and track record. That’s why this is just a 3% position for me (January 2026 $150 puts). It’s enough to hurt if I’m wrong, but not enough to cause major damage.
Why January 2026? I’m predicting the market loses patience after multiple quarters of mediocre profits. Assuming even $3 EPS for ‘24/’25, maintaining a 60X ($180 SP) multiple seems implausible to me.
My biggest risk, besides being wrong, is that the market gives grace to Tesla for longer than I think it will. Musk is without parallel in marketing his vision and is backed by an army of devoted retail shareholders. Maybe they CAN keep the stock up here for years at 60X.
So that’s basically it; full disclosure. Why do I hang out here? The Tesla / Musk saga is the most fascinating financial story I’ve seen in decades. Who can resist the drama? Also, I enjoy this board. I lurked here for years before registering. I understand the bull case; and have nothing against the bulls. The euphoria around here a few years ago must have been life-altering! I’m happy for anyone to have done well in the stock market (FWIW, also, my bet here is completely against type; I’m a true buy-and-hold Buffett / Munger type guy. Which is probably why this won’t work out, lol).
Thanks for hearing me out.
P.S. If you want to improve your investing (and be highly entertained), check out the Corner of Berkshire and Fairfax. Lots of good spirited, healthy back-and- forth on individual stocks. Really good analysis and stock ideas. No, I have no financial interest in the site. I’ve gotten some great stocks from it though.
I mean, if Tesla can hit it out of the park on 8.8 (shows car, shows assembly line going, shows app working, shows the path) then it'll be just like old times.....Achievable, sure, with a probability of like 2% maybe!
It seems aggressive but is still possible depending on when they issue the OTA update.
$327billion / 365 days in a year = $0.896b per day, so I’ll just be deducting $0.896b from their potential 2025 net autonomous Robotaxi revenue for each day that update isn’t deployed.
There will be a loss at first and it will be a super slow rollout. Plus, FSD still has a ways to go currently, especially with the 12.4 issues.
Sounds like you're joking, though.
Causalien
Prime 8 ball Oracle
I remember back in the old days going against the general sentiment of buying up solar city. What a disaster solar city turned out to be. But I do agree now there is a street cred element to it.
This feels similar. Financially diastrous, but street cred wise, necessary.
This feels similar. Financially diastrous, but street cred wise, necessary.
I have strong doubts a fleet operator will want to take this on personally. Look at the Hertz mess (hard to get repairs done, parts, etc). No fleet operator will be able to compete with Tesla directly on cost so with the big elephant in the room (Tesla running a fleet) who can kill your own fleet/business, why would a fleet business owner want to even deploy large amounts of capital like this, when they again, ONLY do this for profits to even get involved at all?
You also have a lot of unknowns where if you have a Cruise incident with a full autonomous Tesla fleet, your capital (Tesla RT fleet) can be sitting there doing nothing if a city halted service due to 1 major incident.
Look at how Tesla had to do damage control of EU Fleet Buyers:
Wanted to add I also don't think the majority of Tesla owners will allow their cars to be RT, even if possible and it will have minimal financial impact on Tesla. I don't know the liability of it, but in general, no normal auto insurance will cover this if you use it for business and for most folks, I assume would rather not have someone dirty/throw up/mess up their personal vehicles for low gains/profits.
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I have doubts that Teslas on the road today will ever become robotaxis, though maybe they can become part of the “human-driven ride hail service” that ARK talks about because tons of people will surely pay Tesla part of their profits to have FSD drive them around while they monitor it as a Level 2 ADAS.
More likely it was partisan political sentiment. State functions in Florida are totally run that way now from top to bottom.
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Causalien
Prime 8 ball Oracle
one thing not being accounted for. When the homeless smartens up and orders a ride for $2 for the night and refuses to leave after the ride ends.
Or they get on and start stripping all the valuable material.
A sentient car without survival instincts being pissed at a rider spots a telephone pole.
Well, I think he feels like he should get paid what was previoulsy agreed to... and by the BOD, by the way.
The implication is that at some point you aren't allowed personal endeavors? Where exactly IS that threshold?
I think some people will put their personal Tesla's into the RT fleet, but I think its going to be very small percentage of Tesla owners, like less than 10% I'd say, far FAR less than ARK and most Tesla bulls, and even far less than Elon, think will happen.
My hunch is people simply won't want strangers in their cars like that. I know I don't, and neither does anyone else I talk to. But some will for certain, just a minority IMHO.
You lost me there buddy. Which part is disastrous now that all feels similar?
Also downvoted Solar City, what’s the street cred element?
I see myself as a committed capitalist but an incentive worth more than many smaller countries' GDP? To someone who is the world's richest or second richest man and should already be satisfactorily incentivised by being the largest shareholder of Tesla? I know I wouldn't have voted for that.
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