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The coming Tesla cash cow and the short burn of the century

Discussion in 'TSLA Investor Discussions' started by DaveT, May 4, 2018.

  1. mongo

    mongo Well-Known Member

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    Prediction:
    Release of FSD shrinks the, now realized, deferred revenue expense line item (or is that in deposits?), pushing profit to a record high for the quarter and increasing ASP and sales of in field upgrades going forward.

    Will it be in Q1, allowing S&P inclusion post March? Q2 with the improved base profit (no debit repayment)? Q3 to offset reduced ASP of SR? Q4 to align with sales in China? Shrug.
     
  2. TheTalkingMule

    TheTalkingMule Distributed Energy Enthusiast

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    If the market can't figure this out now, when will it? It's starting to look like the run up to $1T will be for the most part gradual. Hell, even the fanboys here only focus on that automotive and what's happening in the next 2-3 quarters.

    Tesla investors will be rewarded when the cash is on the table and not before, just like Amazon. Wall Street simply cannot see disruption, even when it's clear as day. I guess that's the nature of true disruption.

    I'm taking my last few play pennies and buying shares. Giving up on my OTM option homerun dreams of catching a short squeeze. Sad day, but at least I can feel good making the mature decision. Boooooorrrriinng.
     
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  3. Unpilot

    Unpilot Sell order in at $3999.99

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    I think we all wanted the VW type short squeeze ( I know I did) because of the quick windfall we would get.

    However most longs are just that LONG.
    So a gradual run up is fine.

    Seems that the only thing really holding the price down is fear and bad macro's.

    Both will subside.
     
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  4. TheTalkingMule

    TheTalkingMule Distributed Energy Enthusiast

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    I just want exit velocity for the Tesla mission so they can do what they want. Why are we not building an East Coast battery Gigafactory right now? Wall Street.
     
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  5. Sancho

    Sancho Member

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    For the last two quarters, Tesla has been printing money. Every indication is that this will accelerate later in 2019 and beyond.

    Many investors have a long-held negative view of Tesla. They’ve been in an echo chamber telling them electric cars are a niche, Elon is a freak show, Tesla’s debt is crushing, and competition is just around the corner.

    Each successive quarter of positive cash flow causes more of these investors to shed off years of echo chamber thinking and adjust to the inescapable reality of a thriving company, and an ideal stock for growth investors.

    A tipping point will come when enough investors wake up to this reality, and the SP will reach escape velocity. This could happen any time now. I’ve been wrong before, but I’d be surprised if it doesn’t happen sometime this year.
     
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  6. Chunky Jr.

    Chunky Jr. Member

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    I'm guessing a lot of people hate Tesla for two reasons:

    1) They have a cartoonish stereotype of people who drive them, and they don't like those kinds of people. i.e. Hating Tesla is a form of hippy punching. As EVs become more and more mainstream, that sentiment will start to dissipate and fewer people will be cheering for their demise.

    2) They are beholden to the fossil fuel industry in one way or another and don't like what they are seeing, so they fear and demonize it.
     
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  7. eloder

    eloder Active Member

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    It's not disappointing. When they were first predicting such high volumes so early, they were operating under the assumption that the lion's share of those vehicles would be $35k base short ranges. I remember when my first short range delivery estimate was Q1-Q2 2018.

    What we have now is a number that's not too far off from that volume, but will be with significantly higher (mid-range + PUP) ASPs.
     
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  8. DaveT

    DaveT Searcher of green pastures

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    How do you know ASPs will be significantly higher than expected?
     
  9. winfield100

    winfield100 Supporting Member

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    Anything in anticipation of model Y?
     
  10. DaveT

    DaveT Searcher of green pastures

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    The burn is on.
     
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  11. pz1975

    pz1975 Supporting Member

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    Nice bump!!
     
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  12. DaveT

    DaveT Searcher of green pastures

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    Timely, huh?

    Also, check this out:
    #889
     
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  13. Matias

    Matias Active Member

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    I don’t understand this. Of course I’m happy with my +248% gains (Tsla is now approximately quarter of my portfolio), but this sudden move doesn’t make any sense.
     
  14. pz1975

    pz1975 Supporting Member

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    Beautiful! I remember those posts of yours so well..
     
  15. Right_Said_Fred

    Right_Said_Fred Moderator

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    @DaveT You had some great predictions in 2014 and 2018 for Tesla in 2020. Both of them were spot on. Kudos to you for that. You are now devoting a lot of time to your very informative Youtube Channel. It would be nice though if you could find some time and take a shot at predicting where Tesla will be in 2025. You would likely provide us with some great insights.
     
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  16. EinSV

    EinSV Active Member

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    Your original post pointed out that opex had barely increased despite Model 3 production ramping. That very strong operating leverage trend has continued to build for the past two years since this thread started, and now that Tesla is in its second and third rounds of volume production (Model Y and GF Shanghai) has been joined by capex also shrinking fairly dramatically per unit production and per dollar revenue generated.

    That trend should continue as Tesla aggressively seeks out new ways to squeeze more out of each dollar of capex with each iteration of production (Cybertruck for example should be amazingly capex efficient as many have pointed out). Tesla's EV business is becoming much less capex intensive than legacy auto. Tesla's very modest capex projections ($2.5B-$3.5B per year for the next 3 years per the 10K) could generate something like an extra $55B-$60B in revenue if it continues growing at the pace Elon is aiming for.

    The impacts are profound -- starting with the ability to continue to scale at ~50+% per year with minimal need to raise cash.
     
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  17. DaveT

    DaveT Searcher of green pastures

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    Exactly! The point about opex barely increasing with Tesla going from zero Model 3s to full production is something I think is still under-appreciated. Tesla is a lean operation with tremendous operating leverage. You can't compare Tesla's lean operation with other auto makers who are laden with extra expenses. Theoretically Tesla can continue to attack and win new market segments with their current R&D spend, but they probably will increase spending over time because they can and will help them grow faster.
     
  18. DaveT

    DaveT Searcher of green pastures

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    Thanks @Right_Said_Fred.

    Back in 2014, the TSLA 3.0 concept (Articles/megaposts by DaveT) helped me to see Tesla's potential of reaching their $150b market cap in 2020.

    I'm starting to formulate a TSLA 4.0 concept... and that is how autonomous driving will drive sentiment going forward for Tesla and their stock price.

    I'm not as giddy as some in terms of how fast I think Robotaxi will roll out, but I do think the market is massive and the opportunity tremendous. It could drive Tesla growth for the next 15+ years.

    The big question is when does it rollout and how does it get priced into the stock.

    It's just such an ambiguous timeline since it's not completely in Tesla's control. Compare that to the Model 3 rollout... back in 2013, there was decent visibility in terms of timeline and units to be produced.

    So many people are tossing out price targets, and I have my own personal price target that aligns more with Elon Musk's incentive plan... $700B+ market cap by 2028 or so... and probably $1 trillion by 2030. But the X factor truly is autonomous driving and how fast it rolls out.

    I also have some extensive price projections/forecasts I did from back in 2013/2014... forecasting stock price ranges until 2020, and my high range was $1000 in 2020. I might be releasing those spreadsheets in the near future... if I can be convinced they can be helpful to others.
     
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