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Maybe next year.Anyone think we get a buyback announcement today? Or maybe at least an update?
It’s been a year since it was mentioned at the last meeting as a real possibility. They wanted to see how 2023 went with the looming recession, and we’re almost halfway through and things aren’t too bad, right?
On the other hand, we have slipping margins and Elon’s recent “economic enema” tweet.
2 weeksAnyone think we get a buyback announcement today? Or maybe at least an update?
It’s been a year since it was mentioned at the last meeting as a real possibility. They wanted to see how 2023 went with the looming recession, and we’re almost halfway through and things aren’t too bad, right?
On the other hand, we have slipping margins and Elon’s recent “economic enema” tweet.
Is it maybe share buyback time?
It would be very sensible to do so when Tesla can buy TSLA at its current low value, and we are now looking at $23billion in cash doing not very much. Tesla buying TSLA seems a great way to spend maybe $2billion of that?
It also looks like fears of economic disaster were perhaps a bit overblown? TBH I'm surprised the question didn't come up on the earnings call.
Gotta preserve cash so that we can build that robot army!
Apple has a consensus on buyback quantity:
I would be very happy with a one off $5Bn at this stage.
“Imagine for a moment that you decided to invest money now and you bought a farm,” said Buffett, the chairman and CEO Berkshire Hathaway. “Let's say you bought 160 acres...and the farmer next to you had 160 identical acres, same contour, same soil quality.”
Now, imagine that the farmer who has the same farm as yours makes you an offer every day to either sell his farm to you or buy yours, he continued.
“That's a very obliging neighbor,” Buffett said.
Buying stocks — like buying a farm — means you’re buying into a business. But with stocks, you have an added advantage of having that neighbor — or other investors — giving you a price for your farm every day.
“The only thing you have to do is remember that this guy next door is there to serve you and not to instruct you,” Buffett said. “You bought the farm because you thought the farm had the potential. You don’t need a quote on it.”
‘Stocks have an enormous advantage’
Many people may see a disadvantage in being constantly offered a price for your stock — or a farm — and many people may profit from telling you they can predict what the farmer will offer tomorrow or next week.
But you don’t have to listen to them, Buffett said, especially now.
“If you really like the business and you like the management, and the business hasn't fundamentally changed,” Buffett said, “the stocks have an enormous advantage. You still can bet on America.”
So if you had that farm, and your neighbor offered you $2,000 an acre on Monday, $1,200 an acre the next day, and maybe then $800 an acre the day after, that shouldn’t change your evaluation of the farm’s potential.
“Are you going to let this guy drive you into thinking: ‘I better sell because this number keeps coming in lower all the time?’” he said.
Would a $5Bn buyback be that impactful though? Current market cap of around +$800 Bn. Seems like it would be a drop in the bucket for investors like us, but 1/4 or 1/5 of Tesla's cash reserves.Apple has a consensus on buyback quantity:
I would be very happy with a one off $5Bn at this stage.
I think it would get us to an ATH. It means several things to the market:Would a $5Bn buyback be that impactful though? Current market cap of around +$800 Bn. Seems like it would be a drop in the bucket for investors like us, but 1/4 or 1/5 of Tesla's cash reserves.
IF the macro environment does not improve in the coming years, those $5Bn would be very handy to keep R&D/growth rate up.
The confidence is indeed what would (short term) cause a SP bump.I think it would get us to an ATH. It means at least three things to the market:
I don't see Tesla having a cash shortfall.
- Buying of shares
- Removing shares from the pool
- Confidence from the insiders that this is a good time to buy etc.
- Economy
- Tesla specific
- Likelihood of more to come
Such sentiments and the entire premise for this thread are built on a core fallacy about TSLA and Tesla resilience. Part of the extreme volatility in TSLA result from high individual investor proportional holdings, a highly emotional core that trades actively, large concentration of speculators, and an unconventional operating history and product base. Those conditions join with Elon Musk and BEV controversy to facilitate manipulation.
I'm now firmly against buybacks.... except for an announcement just before a Triple Witching: Definition and Impact on Trading in Final Hour event. I mean Tesla don't HAVE to buy, just announce & have it hanging over the shortzies.Square has a $26Bn market cap. Announced $1Bn buyback which has contributed to SP up 18% aftermarket.
What Is Triple Witching?
Triple witching is the simultaneous expiration of stock options, stock index futures, and stock index options contracts all on the same trading day. This happens four times a year: on the third Friday of March, June, September, and December. A common expiration date for the three types of equities derivatives can cause increased trading volume and unusual price action in the underlying assets.