TSLA Market Action: 2018 Investor Roundtable

[LoveTSLA]

Bought a lot at 326. I think it is good entry point. Micro helped this.

 

[jhm]

I'm looking forward to the Q1 delivery numbers. There is a good chance that the Model 3 could outsell Model X or even Model S.

It's the climb.

 

[bdy0627]

Wow. This market is pretty nuts given the economic data.

 

[Johann Koeber]

I totally believe that TSLA will go up big time

One day, you will be right.

 

[Intl Professor]

Agreed. I think we are all responsible for our own decisions regardless of whether the predictions given are advice or not. I have lost a lot of money in the past mindlessly following what others trumpet, an


There are varying degrees of bullishness. Yes, every bull who has trumpeted that the share will be at this and that price point by this or that date, should probably be a bit more humbled and maybe more conservative in their prognostications in the future. Same goes with those who are absolute cocksure about where the ramp would be by now, especially knowing the history of Elon and Tesla with their previous iterations.

Those of us who are overall bullish on the long term viability of the company, the electrification vision and the man Elon, has nothing to apologize for, at least at the moment.

I think most of us here conflate short term share price movements and volatility with the health of the company. As we have seen, the market, especially for TSLA, can be quite irrational and quite frequently have no bearing on company health.

I'm one of those lucky people who can say everything bad that has happened to me is directly connected to something I did. No one else is to blame. I know people who are peers with many multiples of our wealth who have considerable credibility in predicting the health of the macro economy and they will share their thinking with me. They avoid advice on stocks or what I should do with money. They won't even give advice on a good lawyer. (A handyman, maybe.)

The wealthiest man I know is a former student and extremely wealthy personal injury lawyer. The reason for his success is an acute sense of individual psychology. One of the utilities of his sensibility is really knowing when a client is lying. Of course this talent is also useful in selecting and then dealing with a jury. However, he's just as stupid about women as I am. I remember he turned to me for discussion, not advice, as he was thinking about his first divorce. I don't remember details but hope I didn't tender advice. If I did he certainly has not held it against me because he was obviously responsible for the outcome.

 

[LoveTSLA]

Bought a lot at 326. I think it is good entry point. Micro helped this.

Well I should have waited a little longer but I am good for where I got in.

 

[Chocochip]

It's rather disappointing to see so many long-standing members of this forum be surprised by the ER and the comments from the management yesterday. I guess I'm lucky to have been able to adjust my expectations accordingly through repeated target delays, with both Tesla and SpaceX (there's a very good reason for that commonality, can you guess what?).

Elon Musk is a visionary, a designer and an engineer. What he still isn't, however, is a good planning manager. How many times do people need to be reminded of the sad truth that EM takes the time required to achieve a goal under optimal conditions, and then shortens it expecting people to work extra-hard / overtime etc.? It's enough to listen to him on the conference call yesterday to see the inner conflict between him trying to put forward achievable timelines and his incurable optimism that all the hard stuff is behind and the future brings only smooth sailing.

For instance: the battery pack assembly machine is completed and working at Grohmann in Germany. They expect it in Nevada sometime next month, so that's March. That equipment is necessary to achieve 2500/week production rates. And the management is guiding for hitting that rate by the end of Q1? C'mon, how many things can go wrong with that? It would be super-lucky for them to be able to set up the equipment, get it started and optimise the whole process for hitting that rate all within a couple of weeks!

The one thing that really got to me: him talking about how all the other OEMs not even being aware of the potential improvements in production speed! Tesla is still far from matching the production speed of others! Of course I am convinced he has a clear plan to bring about major breakthroughs in production speed and efficiency, but it really would serve him well to save these comments until after he's achieved these goals! Rant over.

I sold some other stock yesterday in preparation for the post-ER dip. I don't believe we've hit bottom yet, it might happen tomorrow or next week. I can't think of any impending good news (other than AP progress / updates) that would make the SP jump higher in the short term. So I'm still waiting to buy. I'm long, in case it wasn't obvious.

 

[gene]

Just to be clear, we're talking about the goodwill of a line that's waiting on cars that 95-99% haven't even seen or test driven before. Also, that's in the hundreds of thousands. These are astronomical expectations on one of the hardest problems on the planet to solve.

I'm willing to bet they'll come back once the production issues are fixed; there isn't another car on the market that's going to be better than the Model 3 in the short/medium term. Ho hum.

I almost feel guilty for already taking delivery on 2 Model 3's. But I want to mention that the wait, even if it is many months later, once you drive your new Model 3 will all seem worth it. I recommend that nobody cancels their reservations. You might be pissed off now, but if you cancel, the months will pass, and as soon as you ride in some friend's Model 3, you will literally sh** in your pants that you had actually cancelled your chance at a Model 3.

 

[Zhelko Dimic]

I'm starting to leverage up.
Selling Jan 19 $100 strikes to buy Jan 19 $180 strikes in a 2:3 ratio, for a very, very modest cash outlay, almost net even.
Tesla's cash position, $3.4B in the bank does it for me. Problems Tesla has are surmountable, and TSLA will reflect this in due time (weeks or months)...

 

[anticitizen13.7]

Wow! There are a lot of people who aren't too happy with Tesla at the moment over these delays. I'm surprised people didn't see it coming even though the estimates hadn't been changed recently.

I think some were hopeful that the ramp up would happen for them. Many don't follow Tesla as closely as people here, and haven't seen this show play over and over.

I fully expected a public relations disaster if Tesla wasn't able to deliver with some sense of normality and timeliness relative to the expectations they generated, and now it has happened. Even here at TMC, people are pissed: Cancelling my reservation

What to do with this data? Today, the broader markets are faltering. TSLA is basically tracking NASDAQ, but with greater amplitude. I hold a smattering of non-TSLA shares in other tech companies, about half of which are actually getting hit noticeably harder % wise than TSLA. The message on Elon's Midnight Cherry Roadster cruising towards Ceres Station in the Belt says "Don't Panic", which is good advice IMO. People should let the macro blow over and allow Tesla time to keep ramping. The Model X situation really bad in early 2016, but it eventually resolved, and that was a much worse scenario than today. Tesla is delivering Model 3's with fairly good build quality, which was not the case with the X.

 

[Ulmo]

Disparate interpretations. Shorts must be playing full market game today.

Q4 letter shows successful resolve and progress for Tesla, with no surprise good news. All the bull information was old news, and bears had fresh FUD to spin. Down market day helped them.

 

[Zhelko Dimic]

I'm starting to leverage up.
Selling Jan 19 $100 strikes to buy Jan 19 $180 strikes in a 2:3 ratio, for a very, very modest cash outlay, almost net even.
Tesla's cash position, $3.4B in the bank does it for me. Problems Tesla has are surmountable, and TSLA will reflect this in due time (weeks or months)...

Huh, around 150% TSLA on my main account now. That's probably around 130% TSLA overall.
If we don't improve by Jan 2019, I'll be in trouble

 

[EinSV]

I think some were hopeful that the ramp up would happen for them. Many don't follow Tesla as closely as people here, and haven't seen this show play over and over.

I fully expected a public relations disaster if Tesla wasn't able to deliver with some sense of normality and timeliness relative to the expectations they generated, and now it has happened. Even here at TMC, people are pissed: Cancelling my reservation

What to do with this data? Today, the broader markets are faltering. TSLA is basically tracking NASDAQ, but with greater amplitude. I hold a smattering of non-TSLA shares in other tech companies, about half of which are actually getting hit noticeably harder % wise than TSLA. The message on Elon's Midnight Cherry Roadster cruising towards Ceres Station in the Belt says "Don't Panic", which is good advice IMO. People should let the macro blow over and allow Tesla time to keep ramping. The Model X situation really bad in early 2016, but it eventually resolved, and that was a much worse scenario than today. Tesla is delivering Model 3's with fairly good build quality, which was not the case with the X.

There is no doubt that there are reservationists who are frustrated or angry and will cancel. But in looking at threads like the one in your post (and similar) I think it is also obvious that the FUDsters are out in force (the Madoff reference is one example of a dead giveaway). Plus the people who are upset are most likely to be vocal on social media.

Tesla's statement yesterday that despite the delays to date the number of reservations was stable and actually increased again once Model 3 hit the stores is worth keeping in mind. Once the dust settles, my guess is that the number of reservations will remain stable and perhaps even climb until production ramps up enough to start cutting into the backlog and that Tesla will be able to sell every Model 3 they can make for a very long time.

 

[SteveG3]

Yep. I don't want to dig back through the thread to find them but there were several, not just TT. I also don't want this discussion to go any further. People are entitled to express their opinions about the stock. There's nothing wrong with that. The point is that people need to use caution about investing or trading based upon others' opinions. Predicting TSLA short term is pretty much impossible, even by the Tesla gurus here. We all get lucky sometimes but no one can consistently predict the stock movement. Also, today is a complete market crash, not just TSLA.

That part, we are in strong agreement on. My short hand on this advisable caution regarding trying to predict short-term movements, (short-hand which, I began using here in June when we were trading in the $380s), is to think of the TSLA price at any given moment as X dollars +/-$50 (as in post #12475 for example).


2017 Investor Roundtable: TSLA Market Action


"[snip]

As I said yesterday, I have little idea whether the stock price currently is $383 +/-$50, $433 +/-$50 or $333 +/-$50. The bit in those figures I have by far the most confidence in is the +/-$50, and by price, I mean what we will see quoted, not my valuation of the company.

To be clear, I think the shares are currently undervalued for a long term investment (hang onto any core shares!)

[snip]"

 

[Big Earl]

I'm going to jump in here with my newbie opinion on the subject. I'm a non-owner who waited in line on 3/31/16, excited about the upcoming Model 3 before I even knew what it looked like. Yesterday's earnings call was encouraging, as I've been following the saga closely for some time. I'm familiar with Tesla time and while a little disappointed in last night's delivery estimator adjustments, I'm still very positive about what Tesla is doing and I'm looking forward to the Model 3. I'm also fine with today's market losses, as I finally took the plunge and bought my first few shares of TSLA. Thank you all for your insight in this thread.

 

[schonelucht]

Well understand your doubts but allow me to say, as a German engineer talking about German engineers, if Gromann confirmed it works you can be damm certain that it does.

This is also my experience when working with German automation engineering. However, when it goes from moving an installation from their test facility into a productivity environment they will also have laid out in painstakingly detail what the (seemingly minor) differences are between the two sides and modes of operations, what caveats there are, how long the mandatory formal validation must take etc. And my guess is that Elon ignored that part of their message completely.

 

[Curt Renz]

I almost feel guilty for already taking delivery on 2 Model 3's. But I want to mention that the wait, even if it is many months later, once you drive your new Model 3 will all seem worth it. I recommend that nobody cancels their reservations. You might be pissed off now, but if you cancel, the months will pass, and as soon as you ride in some friend's Model 3, you will literally sh** in your pants that you had actually cancelled your chance at a Model 3.

There is no doubt that there are reservationists who are frustrated or angry and will cancel. But in looking at threads like the one in your post (and similar) I think it is also obvious that the FUDsters are out in force (the Madoff reference is one example of a dead giveaway). Plus the people who are upset are most likely to be vocal on social media.

Tesla's statement on the call yesterday that despite the delays to date the number of reservations was stable and actually increased again once Model 3 hit the stores is worth keeping in mind. Once the dust settles, my guess is that the number of reservations will remain stable and perhaps even climb until production ramps up enough to start cutting into the backlog and that Tesla will be able to sell every Model 3 they can make for a very long time.

I assume that those complaining are generally people who want a minimally priced Model 3 and currently own a car that is getting old and developing problems. Of course some of those expressing frustration may actually be short sellers pretending to be reservation holders. The Model 3 that unhappy folks want would be the version with minimal profit margin for the company. Shareholders should be pleased that versions with higher profit margins are getting priority. That has long been Tesla's general procedure, which makes sense and should not be surprising.

Meanwhile, complaints are not being heard from the horde of Model 3 reservation holders like me who are more than willing to wait. My current car has only been driven for 25,000 miles and is free of problems. I am happy that others are essentially serving as Model 3 beta testers. A longer wait means any necessary corrections will be made and advanced improvements will likely be added before my Model 3 is delivered.

I suspect that most of those unhappy with the delay will eventually buy a Tesla car, even if they temporarily buy something else to replace their current car. Indeed it may be wise for those folks to maintain their Model 3 reservations, and the large majority of them may do so despite frustration being expressed today.

 

[Ghostman]

Just a comment regarding the delivery estimates. I’m from Toronto and my estimate actually was pulled in. Originally it was late 2018. Now it says mid 2018. With the slower production ramp, perhaps they are now evaluating delivery options to maximize the US EV credit and not hit the 200k units in the US. Sucks for those in the US, but I’m ecstatic that there’s a remote chance of getting mine in <6 months!!

 

[DarrenHD]

This is also my experience when working with German automation engineering. However, when it goes from moving an installation from their test facility into a productivity environment they will also have laid out in painstakingly detail what the (seemingly minor) differences are between the two sides and modes of operations, what caveats there are, how long the mandatory formal validation must take etc. And my guess is that Elon ignored that part of their message completely.

I have worked in a large manufacturing facility where we had all the machines brought in from Germany. Ok, it was not automobile manufacturing, but still, high-tech precision, high speed manufacturing. Huge production floor about the size of 22 football fields, many dozens of large machines. All German built. Shipped from Germany and re-assembled and setup right on our production floor.

We had German engineers on site for months helping us get the machines ready for high speed production. The last German engineer probably left after a year. It can take a LONG time to properly setup, calibrate, test, test again, validate, debug, troubleshoot, etc... these complex machines. Test production runs, fix, repeat, etc...you get the picture.

Even if today they can do it faster/better, it could still take a month or two (minimum) to get the line up to full operating speed, probably longer. I would safely estimate 3-4 months at least, probably.

Anyone who says 3-4 weeks is probably on the very high-end of "optimistic"

 

[Yggdrasill]

I have worked in a large manufacturing facility where we had all the machines brought in from Germany. Ok, it was not automobile manufacturing, but still, high-tech precision, high speed manufacturing. Huge production floor about the size of 22 football fields, many dozens of large machines. All German built. Shipped from Germany and re-assembled and setup right on our production floor.

We had German engineers on site for months helping us get the machines ready for high speed production. The last German engineer probably left after a year. It can take a LONG time to properly setup, calibrate, test, test again, validate, debug, troubleshoot, etc... these complex machines. Test production runs, fix, repeat, etc...you get the picture.

Even if today they can do it faster/better, it could still take a month or two (minimum) to get the line up to full operating speed, probably longer. I would safely estimate 3-4 months at least, probably.

Anyone who says 3-4 weeks is probably on the very high-end of "optimistic"

I think you overestimate the complexity of the machines. My guess is that several lines will take up less than one football field. And I think Tesla is probably counting only one or two lines operational in March, with more to follow in April. They'll likely keep the semi-automatic lines well into Q2, and phase it out once the last automatic lines are brought online.