TSLA Market Action: 2018 Investor Roundtable

[ggr]

I get your point, but didn't Tesla used to patent their innovations and then give other companies full access to those patents in the name of catalyzing sustainable transport and preventing others from patenting their innovations and not sharing? Maybe this innovation does not fall under helping sustainable transport?

Patents are not the only form of intellectual property. They were trying to avoid the kind of patent licensing bargaining that goes on in the cellphone business for example. They didn't promise to give out secret formulas, or plans to make cars or factories.

 

[MP3Mike]

Next major catalyst I see, coming in approximately 4 weeks, major autopilot upgrade.

It is not coming in ~4 weeks. It goes out to the EAP, Early Access Program, participants in approximately 4 weeks. Then it could be weeks, or even months, before it completes testing with that group and gets released to anyone in the general public. My guess would be ~8 weeks at the earliest.

Yes, having the new version of EAP only go out to the EAP participants can be confusing. (Thanks to the overlapping TLAs.)

 

[MarcusMaximus]

Next major catalyst I see, coming in approximately 4 weeks, major autopilot upgrade.
No idea what happens between now and then, but should be on the radar.

Note that he said early access in 4 weeks. I wouldn't expect too much of a bump from that beta version. Once it gets out in the wild, hold on to your butts.

 

[Mokuzai]

Next major catalyst I see, coming in approximately 4 weeks, major autopilot upgrade.

4 weeks maybe, 8 definitely!

 

[Cosmacelf]

I'm not so sure - look at Ihor's graph from yesterday, not much change, especially given the trading volumes yesterday.

As I Tweeted last night, this graphic should terrify anyone with a short position - such a massive upward movement, without any corresponding drop in short shares.

And look when most of them have come on-board, it's nearly all sub-$350, which implies as of now, most are under water.

No doubt the bigger-players with diverse portfolios can hold their position for ever, if they wish, but smaller and retail holders are staring into the abyss right now.

My intuitive guess is that $370 will open the exit-gates. Not beyond the realms of probability that this could happen today... Pre-market is slightly down, but not a lot of volume. Macros could have a bearing, tech was a bit over-heated yesterday, might pull-back a bit.

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So far today, we are seeing the same price action. Stock drifts until noon, then going up. I’m not saying it is a short squeeze, just that some retail investors are getting margin called at noon and the result is the upward movement. Also, I wouldn’t be surprised if new shorts are jumping into the mix given the dramatic price movement. Certainly the financial press hasn’t been bullish on Tesla even now. I just read an article “7 things to watch for Tesla” and almost every second sentence was wrong.

 

[Earlian]

And that was the last I’ll ever see from the @FirebirdAlpha account...
Have fun on my special list with all your friends.

Don’t know whom you’re replying to, since my list is well treated and growing fast, but it must’ve been dirty the last 3 pages since there where a lot of others answering to one-sided posts.

There should be a “Market Action: Blacklist” for long time members.

 

[mikevbf]

Patents are not the only form of intellectual property. They were trying to avoid the kind of patent licensing bargaining that goes on in the cellphone business for example. They didn't promise to give out secret formulas, or plans to make cars or factories.

Interesting point. This, however, is more on the hardware/software side of intellectual property like Tesla's supercharging tech which I believe Tesla has patented and shared.

The more I think about it, the problem with any other company being able to use this chip is how extremely customized the chip is to Tesla's vision/neural network approach to solving the self driving challenge. In order for any other company to actually use this chip, wouldn't they have to almost adopt Tesla's whole approach and buy it more as a turnkey hardware/software package sensors and all?

 

[Runarbt]

Do we end today +/- 350? Maybe 355?

 

[Tslynk67]

I think it's more that it keeps reaching for, and bouncing back from, 350. Also, note the volume. I checked ~20 minutes after opening and volume was already at 6M.

Volume 10 million which is pretty high for a stock going sideways!

 

[Joe F]

"Show Ignored Content"

Why, no. No thank you. There's a reason they're ignored. Life's too short to deal with those with disruptive tendencies.

 

[Esme Es Mejor]

The bond and CDS markets didn't flinch from their pre-earnings pessimism, while equity did.

My apologies to everyone who can’t see the post I’m responding to.

Almost every “fact” you mentioned in your post was incorrect. But one in particular caught my eye.

The bond market has responded incredibly positively to the ER. Bond prices have increased by more than $2.60, which is about 23% of the gap between the market price & par value.

So, the equity market has improved by about 17% since the ER, but the bond market has improved by 23%. No matter where you look, it’s all strongly positive for Tesla.

 

[Cosmacelf]

I came across this weird video while browsing $TSLA on Twitter:

five00pagesaday

Gives some insight into the insane minds of the shorts and why a lot of them won't start covering until it rises much further and instead double down.

I was only able to spend a couple of minutes on it too. What a conceited uninformed jerk. If all the shorts are like this, then I am ecstatic they will lose tons of money.

Btw, one of the swipes he and other shorts took against Tesla was that a lot of their free cash flow came from expanded payables. So what? If vendors are willing to extend Tesla credit, more power to Tesla. And they don’t seem to get that as volumes grow dramatically, as they are doing with the Model 3, then payables have to balloon too. It’s organic. On the CC, the only analyst with a brain, Feringue (sp?), estimated that free cash flow will expand by $20K per car due to the delay between getting up front customer cash, and 60 day payables. Since almost all capex has been spent, increased production now helps working capital, it doesn’t hinder it.

 

[jw934]

And here we have an actual recording of the reaction of a German short seller after he heard the Q2 results.

 

[TSLA_Hopeful]

I don't know about you all... but I like a slow burn..... a SIMMER. Remember when those shorts put us down a dollar or two a day? Payback.

 

[CorneliusXX]

I'm really curious how Tesla will be able to build factories in China and Europe given that they're still cash flow negative, they're still struggling on Model 3 gross margin, and they're not planning to refinance 1B in loans due over the next several months.

The China factory costs 5 billion by Tesla's estimate. Where does the money come from?

On the short side, it is stunning to see the equity markets react the way they have. The bond and CDS markets didn't flinch from their pre-earnings pessimism, while equity did.

Well you see goods can be sold for money. More goods can be sold for more money. Tesla has recently achieved a faster production rate of goods. So if I do my sums correctly I think that means they get more money. Money can then be used to do the stuff you're talking about .

 

[Earlian]

And here we have an actual recording of the reaction of a German short seller after he heard the Q2 results.

I don’t address it to you in person, but since it was the 5 (or so) time this video is posted, I can’t hold back anymore.

The subtitle is really funny if you are a long time follower of Tesla’s way, but if you’re native German listener and have a bit of history knowledge, the video itself is far from funny, if not inappropiate to use for jokes.

I wish Tesla to succeed in every possible way, especially while they’re creating a new standard in many ways of human life. So maybe, there’s other film material to use for future jokes.

 

[MarcusMaximus]

I don’t address it to you in person, but since it was the 5 (or so) time this video is posted, I can’t hold back anymore.

The subtitle is really funny if you are a long time follower of Tesla’s way, but if you’re native German listener and have a bit of history knowledge, the video itself is far from funny, if not inappropiate to use for jokes.

I wish Tesla to succeed in every possible way, especially while they’re creating a new standard in many ways of human life. So maybe, there’s other film material to use for future jokes.

Note that there's also a lot of history to using this video generally. It's a long standing meme(I think I first saw it w/ regards to iPhone vs Android debates ~8 years ago). It's from a movie(forget which one) about WWII and is Hitler learning that things aren't going as well as planned.

Also, as long as I'm responding about this video, I love the "Elon's a liar and never delivered the Etherium he promised on Twitter" bit.

 

[Tslynk67]

I don’t address it to you in person, but since it was the 5 (or so) time this video is posted, I can’t hold back anymore.

The subtitle is really funny if you are a long time follower of Tesla’s way, but if you’re native German listener and have a bit of history knowledge, the video itself is far from funny, if not inappropiate to use for jokes.

I wish Tesla to succeed in every possible way, especially while they’re creating a new standard in many ways of human life. So maybe, there’s other film material to use for future jokes.

You realise this video-meme, with various fake subtitles, has been doing the rounds for years, it's not new.

Downfall is a fantastic film, Bruno Ganz in the lead role put in a very powerful performance.

 

[scaesare]

Patents are not the only form of intellectual property. They were trying to avoid the kind of patent licensing bargaining that goes on in the cellphone business for example. They didn't promise to give out secret formulas, or plans to make cars or factories.

Indeed.

patent != implementation

 

[Cosmacelf]

I'm really curious how Tesla will be able to build factories in China and Europe given that they're still cash flow negative

They were cash flow negative last quarter,this quarter that we are in, they will be cash flow positive. Didn't you read the shareholder letter or listen to the conference call?

, they're still struggling on Model 3 gross margin,

Margins are increasing rather dramatically, I don't see any struggle. Also, margin guidance was very positive and strong. Again, did you listen to the CC?

and they're not planning to refinance 1B in loans due over the next several months.

They have $2.2B in cash now, with more on the way due to positive cash flow. And it isn't $1B due in the next several months!

The China factory costs 5 billion by Tesla's estimate. Where does the money come from?

Actually, it was $2B. Where you the hell do you get your numbers from? And Elon told you during the CC call, that you apparently didn't listen to. From local China debt.

On the short side, it is stunning to see the equity markets react the way they have. The bond and CDS markets didn't flinch from their pre-earnings pessimism, while equity did.

That's because the bond market reacts to balance sheet. It doesn't give a rats ass about operating results, all it cares about is in the worst case scenario (Fremont factory explosion, Gigafactory getting bombed), can the company repay the loans.

By definition, the equity market is where the risk takers are. The equity market is constantly guessing at future performance. The bond market is for investors that want a small guaranteed return. Two completely different markets with dramatically different protections, risks, and rewards.

Honestly, Firebird, if you're asking these basic questions, I would recommend you DO NOT invest in anything risky. Shorting Tesla (and going long on Tesla) is risky.