TSLA Market Action: 2018 Investor Roundtable

[Reciprocity]

Amazon in 2007 (in similar market conditions as we have today) was valued around $30 billion with a TTM revenue of $15 billion AND profitability AND many experiments that weren't quite understood by the general public yet.

Tesla has a TTM revenue of less than $15 billion, doesn't have profitability, but does have many experiments that aren't quite understood by the general public yet (all the things mentioned above that aren't yet significant financial contributors) and is valued at $60 billion.

Based on this information, I'm inclined to believe Tesla has some serious downside potential in the short term (Amazon's 2007 market cap was cut in half to $15 billion during the 2008 crisis). Someone tell me why I'm wrong...

Everything was cut in half I'm 2008. Your wrong because no companies this size are growing at 50%+ every year with a clear path to continue to grow at that pace or faster for the next decade or more. People are willing to pay a premium for that kind of growth and Amazon is a prime example. Once Amazon finally built it's business to scale, profits followed. Tesla is no different.

People are going to have to come up with a better argument as to why Tesla shouldn't be valued so high then pointing to Amazon. The only thing these companies share is that grew very fast and didn't any money in the beginning. They are both disruptors, but completely different in that no one is going to die if they go to Costco instead of Amazon. Amazon sells the same crap everyone else does, with few exceptions and didn't really make money until they started selling web services. Would they be anything special without AWS?

 

[Starno]

I agree if your point is that the Model 3 getting out of the woods would be the biggest positive for Tesla since the Model S got out of the woods. Tesla is not nearly as undervalued as it was in 2013, so, price being multiplied by 4 in several months is all but certain not something we will see. Up 30-50% in a year or less we may see.


As to “squeeze”, I’ve been following Tesla closely since Spring of 2012- Tesla has never had a short squeeze and I doubt it ever will. They are extraordinarily rare.

I think Amazon is massively undervalued. And I think Tesla will be worth more than Amazon.

So ....

The bulk of the growth is in front of us, not behind us.

 

[SteveG3]

I think Amazon is massively undervalued. And I think Tesla will be worth more than Amazon.

So ....

The bulk of the growth is in front of us, not behind us.

I think some here are misunderstanding what I wrote several posts back.

In dollars of market cap, agree, most of the growth is ahead of us (and never said otherwise). In percent return of the shares per year, disagree, I don't expect us to do as well as in 2013 over the next year, or even as well as in the period of 2013 to 2018 over the next 5 years.

Just to spell this out, market cap went from $4-5 billion to $30 billion, up $25 billion, in a few months in 2013. In the next decade or so, to my view, market cap is very likely to go up several hundred billion (of course Elon's proposed pay package anticipates a nearly $600 billion increase).

So, sure, Tesla may go up 10-20X as much in terms of absolute dollars added to market cap in the coming 8-10 years. But, as far as percent return on TSLA shares, if it went up 300% to $1400 in the next 4 months (matching what it did in 2013), I'd consider the stock fair to overvalued (and sell some core shares), whereas at $180 in 2013 I thought it was still undervalued (and sold no core shares). If the price 5 years from today is 10X what it is now, I'd think we were quite ahead of fair value, whereas our current price of ~$350 strikes me as below fair value.

 

[Words of HABIT]

I believe Tesla will eventually do far better than Amazon's 2017 meager 3B earnings on 178B revenue. Amazon was founded in 1994 and issued IPO at $18/sh in 1997. Tesla was founded in 2003 and issued IPO at $17/sh in 2010.

 

[SteveG3]

I believe Tesla will eventually do far better than Amazon's 2017 meager 3B earnings on 178B revenue. Amazon was founded in 1994 and issued IPO at $18/sh in 1997. Tesla was founded in 2003 and issued IPO at $17/sh in 2010.

Agree (well, those numbers being "meager" for a nearly $800 billion market cap). Yup, think Tesla will eventually do far better than those revenue and earnings numbers. Tesla hitting (let alone doing far better than) an $800 billion market cap would be tons of gravy beyond what makes this stock worth continuing to hold for me.

 

[Curt Renz]

In the Technical Analysis thread I've discussed how today's upthrust appears to fit into several levels of Elliott Waves.

[URL="https://teslamotorsclub.com/tmc/posts/2611622/"]TSLA Technical Analysis[/URL]

 

[Waiting4M3]

Agreed, although I'd take either a significant new batch of VINs or a significant new non-owner invite wave (preferably both). We did not have a wave of invites last week, so if we also skip this week I will take that as a sign that things are not improving significantly.

Or possibly non-owners' appetite for owning a Tesla is much higher than the existing owners, and uptake rate on the 1st production model is higher than Tesla expected in the 2 batches of invites sent to non-owners.

 

[Waiting4M3]

Everything was cut in half I'm 2008. Your wrong because no companies this size are growing at 50%+ every year with a clear path to continue to grow at that pace or faster for the next decade or more. People are willing to pay a premium for that kind of growth and Amazon is a prime example. Once Amazon finally built it's business to scale, profits followed. Tesla is no different.

People are going to have to come up with a better argument as to why Tesla shouldn't be valued so high then pointing to Amazon. The only thing these companies share is that grew very fast and didn't any money in the beginning. They are both disruptors, but completely different in that no one is going to die if they go to Costco instead of Amazon. Amazon sells the same crap everyone else does, with few exceptions and didn't really make money until they started selling web services. Would they be anything special without AWS?

I think Amazon and Tesla have another thing in common, both were misunderstood by the market.

The market thinks Tesla is just a car company, that they can be crushed by traditional car makers any time. They failed to see that Tesla is more about production automation, vertical integration, synergy of both energy generation and transportation.

The market thought Amazon was just an online "Costco", and the big boys like Walmart/Costco can crush Amazon if they moved in. They failed to see that Amazon was more about developing their own infrastructure at a lower cost than existing competitions. It's not about what they sell, but how they sell that make them more money than their competition. AWS was the tip of the iceberg that finally broke through the surface of the water and became visible.

 

[bdy0627]

and that is when it normally change.. in my experience.

Yeah, me too. The market seems to like to change a pattern once you get used to it.

 

[Zhelko Dimic]

I understand your point, but I don't expect my TSLA $350s to be DITM on Friday. The stock might be above $354.50 (or might not).

The time premiums on TSLA are so steep that I expect to be able to roll to a much higher strike price a couple months out if my $350s are under water.

We can revisit this on Friday...

Sure, if it's $354.5 on Friday, you sell $360 strike a month out to get your premium back, right? Except SP at that time could get to $380. You sell another tranche three months out at $390, and price gets to $480...
Don't get me wrong - what you're doing works very often, I've done it too. it's just that there are risks.
Strategy works until it doesn't, and even 1 in 10 or 20 may make you lose position and regret it. I have. _After_ doubling my money, I got kicked out from NFLX from today's equivalent of $60... Tripled my money on FB and lost position at $75... Now, TSLA is less MOMO than either one of them, but we all wait for it to awaken, right?

 

[Brando]

They are both disruptors, but completely different in that no one is going to die if they go to Costco instead of Amazon. Amazon sells the same crap everyone else does, with few exceptions and didn't really make money until they started selling web services. Would they be anything special without AWS?

Costco (from what I read, which is all I think I know) seems a great place to work benefits/pay.
Not so for Walmart and Amazon - many of their employees qualify for food stamps.

Report: Walmart Workers Cost Taxpayers $6.2 Billion In Public Assistance

700 Amazon Employees In Ohio Are On Food Stamps

Richest man in the world can't afford to pay a living wage. Don't shop Walmart or Amazon. what else can I do? you?

[Mod: this has gone off-topic, especially for the market action thread. But I can't think where to move it or exactly when it went off, so I just request no more on this topic in this thread. --ggr]

 

[Irishjugg]

Yes, any company can underperform following ATH, but to this extent? with fundamental outlook improving? only three times before?

Tesla does this every time after ATH

 

[ValueAnalyst]

Tesla does this every time after ATH

Hmm... Do you mean after the last ATH in a series, which is not predictable looking forward?

TSLA has done what I described three times in its history, and after each time the stock has surged in the following months.

 

[HG Wells]

Prepare for another day, of the surge !

 

[ValueAnalyst]

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[Big Earl]

Prepare for another day, of the surge !

Bring it on! I have my cup of coffee ready to go.

 

[Richgoogol]

Well someone jinx it...and I am talking about you HG Wells

 

[HG Wells]

Well someone jinx it...and I am talking about you HG Wells

Well I do have an order in for 100 shares at $338.05

 

[madodel]

Well someone jinx it...and I am talking about you HG Wells

It was up $18 yesterday. Traders are taking profits.

Has anyone figured out why the large jump yesterday?

 

[Richgoogol]

Well I do have an order in for 100 shares at $338.05

Great minds think alike I guess..my order got executed at 338.80