TSLA Market Action: 2018 Investor Roundtable

[EinSV]

Is SpaceX the lynchpin in taking Tesla private?

No.

 

[MP3Mike]

That does not sound like a walkback to me: "First, I would like to structure this so that all shareholders have a choice. Either they can stay investors in a private Tesla or they can be bought out at $420 per share, (...)

Can't find a section where he said and the third option is that you are forced to sell. A choice is a pretty independent decision in my view.

Two problems with that:

1. "I would like to structure this so that all shareholders have a choice." That clearly states that he might not be able to structure it that way.
2. Either you can stay because you want to and you are allowed to stay OR you can be bought out at $420. Again all bases covered.

While Elon can do a lot he likely can't change the laws in other countries as well as the rules in everyone's 401k plans.

 

[KCapital]

@ 2:08pm , someone scooped 160K $TSLA shares between $354.62 - $355.52, that is a $56.8M buy order.

 

[UnknownSoldier]

@ 2:08pm , someone scooped 160K $TSLA shares between $354.62 - $355.52, that is a $56.8M buy order.

What are you using for following real-time volume?

 

[EinSV]

Adam Jonas theory of Tesla of how to go private

"We believe Tesla could consider an auction for its shares in the private equity market, financed by existing shareholders, new strategics, divestiture of valuable captive assets (Tesla autonomous/shared), and possibly some help from SpaceX."

Jonas has officially lost it. There is a zero percent chance Tesla will divest its autonomy business. There is also no need to raise money from SpaceX.

Wall Street seems to be in complete denial that there are lots of well heeled investors who would be thrilled to plunk $ into a private TSLA. The announcement earlier this week that the Saudi sovereign wealth fund has invested $2B should have been a wake-up call.

And Jonas and the other analysts still seem not to recognize that a huge number of the shares necessary to take Tesla private will be forcibly bought by the shorts. TSLA analysts continue to be totally clueless up to the bitter end.

 

[lklundin]

Do we really care if they go long?

No. Once Chanos et al cover their short positions, they will only be able to afford insignificant positions.

 

[MarcusMaximus]

Sorry I have to ask the 7 people who gave this a ‘dislike’ - do you disagree with the facts I stated (er, because they’re actually true...) or just the fact I said it? Seriously just curious.

Peace!

I might be missing context here(this thread is insane), but my only objection would be that, from what I've seen of the SEC "investigation", all they've done is informally ask questions. It'd be absurd to think that they wouldn't ask questions, since absolutely everybody else in the world is and it's their job to do so. There have been headlines saying they're "intensifying" their "investigation", but when you actually read the content, it turns out that, nope, still just asking the same informal questions. It's all much ado about nothing.

 

[MarcusMaximus]

Jonas has officially lost it. There is a zero percent chance Tesla will divest its autonomy business. There is also no need to raise money from SpaceX.

Wall Street seems to be in complete denial that there are lots of well heeled investors who would be thrilled to plunk $ into a private TSLA. The announcement earlier this week that the Saudi sovereign wealth fund has invested $2B should have been a wake-up call.

And Jonas and the other analysts still seem not to recognize that a huge number of the shares necessary to take Tesla private will be forcibly bought by the shorts. TSLA analysts continue to be totally clueless up to the bitter end.

I'm pretty sure Jonas is convinced that Tesla will sell their Autopilot segment to DARPA as a, what did he call it? Weapons-grade AI?

 

[Fact Checking]

I'm wondering about this: we were dreaming about a short squeeze at the time of the SolarCity deal, too. That never really happened. I guess any institutional investor who doesn't want to go private will quietly exit / be bought out. There is no point voting "no" against the clear wish of the CEO/the Board/the majority of the stokholders. (all this assuming that Elon did his homework and has lined-up sufficient support, which - for many reasons - I'm pretty sure he has done) - unless you vote yes, you don't need your shares. And in the past far from all shares have voted. So I don't think the voting alone will trigger a squeeze.

Yeah, agreed - I was thinking of the following four possibilities:

• I think on the Solar City side the outcome was clear - the existence of the company was on the line, a 'yes' vote was guaranteed. The 'no' votes probably didn't even vote but lent out their shares.
• Technically replacement for a recalled borrowed share has to be found within a settlement period, which on NASDAQ would be T+2. If the shares are recalled right before the voting day and borrowed out again right after the vote, it would not squeeze the shorts.
• Did Solar City shorts roll over their short positions into the options space perhaps? Options cannot be squeezed via recalled shares. Later on they moved into shares again, to reduce shorting costs.
• What was the exact Solar City short interest before the vote - wasn't it around 18%? Borrowing could have been met from retail investors alone, who usually do not bother to vote.

The difference with TSLA would be that short interest is much higher (27% of the float), and the outcome of the vote might not be a surefire thing, especially if the stock price is volatile close to the vote. In that case it's not inconceivable to see most institutional shareholders vote.

But yes, it's also entirely possible that the vote will not create a shortage of shortable shares.

 

[Artful Dodger]

But current price, I think, reflects that market thinks there is low chance of success. [continued]
If buyout fails, I think we fall to $300 in a short term, so I feel market believes about 40-45% Musk can pull this off.

In an interview in CNBC, Gene Munster predicted a near term drop in SP in an over reaction to the "Musk Tweeted Bad" bear case. He later published this on his website:

Did Musk do anything wrong?
The short answer is we don’t think so. That said, this topic could weigh on shares in the near-term. In 2012, the SEC ruled that social media can be used to disclose material information as long as investors are aware and access is not limited in what’s known as the Reed Hasting’s Rule.

Tesla's Strengthening Case to go Private | Loup Ventures

 

[KarenRei]

In an interview in CNBC, Gene Munster predicted a near term drop in SP in an over reaction to the "Musk Tweeted Bad" bear case. He later published this on his website:

Did Musk do anything wrong?
The short answer is we don’t think so. That said, this topic could weigh on shares in the near-term. In 2012, the SEC ruled that social media can be used to disclose material information as long as investors are aware and access is not limited in what’s known as the Reed Hasting’s Rule.

Tesla's Strengthening Case to go Private | Loup Ventures

The main critique is that all disclosures are supposed to be instantly and equally available to everyone. The short argument is that Musk has banned several people (including some prominent shorts and some persistently-hostile short-friendly journalists) on Twitter.

I can imagine the SEC not liking that.

I also can't imagine them making some sort of massive case of it. Did any of the (proportionally few) blocked people cover at a higher price than they otherwise would have? Damages would be pretty minimal if any.

 

[Fact Checking]

@ 2:08pm , someone scooped 160K $TSLA shares between $354.62 - $355.52, that is a $56.8M buy order.

Saw that too, and there's more:

• The 'aggressive seller' of the last two days was less present today but a couple of times during the day I saw signs of him trying to stem the strength of the bounce from $350 - but it was not as aggressive (or not as successful) as yesterday. The 160K buy order punched through that effort.
  
• The 160K buy order was followed by very bullish TSLA price action that ignored a drop in NASDAQ futures and a drop in S&P futures.
• If the last 2 days downwards price action from $380 to below $350 was about a big options play then there might be more attempts later in the day, and in the last minute in particular. If there's any big accumulator of shares watching then those attempts could become very expensive.

 

[Unpilot]

Nice upward movement in the last half hour.

 

[Fact Checking]

The main critique is that all disclosures are supposed to be instantly and equally available to everyone. The short argument is that Musk has banned several people (including some prominent shorts and some persistently-hostile short-friendly journalists) on Twitter.

I can imagine the SEC not liking that.

I also can't imagine them making some sort of massive case of it. Did any of the (proportionally few) blocked people cover at a higher price than they otherwise would have? Damages would be pretty minimal if any.

Note that the "bear case" is even weaker: Elon's tweets are instantly available through Twitter's website - it's just like a corporate website that is posting notices to the public:

Elon Musk (@elonmusk) | Twitter

Even if @elonmusk banned a few entities from Twitter messaging, he cannot ban them viewing his page through the Twitter website.

 

[AWDtsla]

The main critique is that all disclosures are supposed to be instantly and equally available to everyone. The short argument is that Musk has banned several people (including some prominent shorts and some persistently-hostile short-friendly journalists) on Twitter.

LOL that has to be a joke. Just because a twitter user banned you doesn't mean you can't see their tweets. Did you not know about the log out button?

 

[Evoforce]

The main critique is that all disclosures are supposed to be instantly and equally available to everyone. The short argument is that Musk has banned several people (including some prominent shorts and some persistently-hostile short-friendly journalists) on Twitter.

I can imagine the SEC not liking that.

I also can't imagine them making some sort of massive case of it. Did any of the (proportionally few) blocked people cover at a higher price than they otherwise would have? Damages would be pretty minimal if any.

I don't use twitter but still heard about it and was able to read the tweets posted in other available online content regarding the tweets.

 

[KarenRei]

LOL that has to be a joke. Just because a twitter user banned you doesn't mean you can't see their tweets. Did you not know about the log out button?

Don't talk to me, talk to the shorts making this argument.

Again, I can see the SEC not liking it. I can't see them making a big deal out of it.

 

[AWDtsla]

Don't talk to me, talk to the shorts making this argument.

Not enough time in the world to address all their BS.

 

[ZsoZso]

The main critique is that all disclosures are supposed to be instantly and equally available to everyone. The short argument is that Musk has banned several people (including some prominent shorts and some persistently-hostile short-friendly journalists) on Twitter.

That's a failed argument right from the get go. The disclosures are supposed to be instantly and equally available to every shareholder, not everyone! Tesla/Musk has absolutely ZERO obligation to inform shorts of anything! Shorts are neither shareholders nor investors, they are gamblers at best, parasites would be a more fitting description.

 

[The Blue Owl]

From Twitter:

*TESLA IS SAID TO SEEK WIDE INVESTOR POOL FOR TAKE-PRIVATE PLAN * TESLA IS SAID TO WANT TO AVOID CONCENTRATING OWNERSHIP OF STOCK *TESLA IS SAID TO HOLD EARLY DISCUSSIONS WITH BANKS ABOUT PLANS *TESLA DELIBERATIONS SAID TO BE EARLY STAGE, NO DECISIONS MADE on @TheTerminal