TSLA Market Action: 2018 Investor Roundtable

[SpaceCash]

Totally spitballing here but what if, after the yuuuge profitability of Q3, Tesla announces an immediate and substantial stock buy-back? That would hasten the much-anticipated squeeze, although from a strictly operational perspective it mightn't be easy to justify

 

[TrendTrader007]

Totally spitballing here but what if, after the yuuuge profitability of Q3, Tesla announces an immediate and substantial stock buy-back? That would hasten the much-anticipated squeeze, although from a strictly operational perspective it mightn't be easy to justify

I doubt they’ll do it but I must admit that Elon owes it to $TSLA shareholders with all the money and heartache he caused with the tweet

 

[TrendTrader007]

I will allow myself to daydream IF @elonmusk announced stock buyback after Q3 or Q4 profitability that would totally decimate the shorts and make VW/ Porsche short squeeze look like a PG 13 movie

 

[SpaceCash]

I will allow myself to daydream IF @elonmusk announced stock buyback after Q3 or Q4 profitability that would totally decimate the shorts and make VW/ Porsche short squeeze look like a PG 13 movie

It would be the most, dare I say, EPIC thing ever. And it's the kind of thing Elon really, really might do.

 

[TrendTrader007]

Totally spitballing here but what if, after the yuuuge profitability of Q3, Tesla announces an immediate and substantial stock buy-back? That would hasten the much-anticipated squeeze, although from a strictly operational perspective it mightn't be easy to justify

I actually love the idea! The more I think about it the more excited I get. It’ll probably never happen at least not for another 10 YEARS but still
Thanks for bringing it up
That will totally KILL the shorts

 

[theschnell]

It would be the most, dare I say, EPIC thing ever. And it's the kind of thing Elon really, really might do.

Extremely unlikely and not a good long term move. They still need cash to build out the rest of their products / factories

 

[Remus]

I actually love the idea! The more I think about it the more excited I get. It’ll probably never happen at least not for another 10 YEARS but still
Thanks for bringing it up
That will totally KILL the shorts

This is the irrational thinking that got me question whether I am really in the right camp.

 

[scaesare]

ZEV/Other Credits Q3

I really wish you would pose polls and questions as such in the thread title. As they are now, they appear informative, rather speculative.

 

[hacer]

One thing I really do not get is the tsla solar. Residential Solar is really commodity imho. Yes, the tsla solar roof has its appeal and will sell to a niche market. But last time I crunch the numbers it is nowhere close to the mass market. So I do not foresee it will make up more than 5% in the tsla revenue in, say, 6-8 years. Could anyone educate me here please?

The expectation is that prices will come down in the future to the point that it is close to mass market, at least for new construction. It's a combination of improving manufacturing tech and economies of scale. But it will always be a premium product.

 

[sundaymorning]

Now this is ironic, not a peep from the media? And this is a worldwide actual recall on the brakes?

BMW recalls vehicles worldwide because of potential problems with the brake lines - China Certification – CCC mark certificate (3C) for China – Your expert for China Compulsory Certification

umm, welcome to the 21st century Bimmer, where’s over the Air Updates, still stuck in the dinosaur age?

Nissan recalls over 215,000 crossovers and sedans for fire risk

Owners advised to park their cars away from other cars and structures.

You mean a gas tank can leak after a collision?

Car recalled over fault that can increase risk of fire after collision

 

[sundaymorning]

This is not the Russian collusion but close enough.

VW, BMW and Mercedes to be investigated over car emissions control system collusion | This is Money

 

[SO16]

I doubt they’ll do it but I must admit that Elon owes it to $TSLA shareholders with all the money and heartache he caused with the tweet

Oh I think many shareholders have done just fine with TSLA. Elon doesn’t OWE any of us sh!t.

 

[HG Wells]

Oh I think many shareholders have done just fine with TSLA. Elon doesn’t OWE any of us sh!t.

Yes he does owe us.
He owes us the best cars in the world,
and he has delivered !

 

[gringotuanis]

Oh I think many shareholders have done just fine with TSLA. Elon doesn’t OWE any of us sh!t.

Incorrect, due to the false info in the tweet...many of us made investing decisions that afternoon and in the days after that caused substantial losses. I wish I had not moved funds around but I had to because of how my long term options were affected. I am still down from what he did that day. If he hadn't tweeted and we just had the Q2 earnings - it would be fine. Why defend such terrible behavior by a CEO? It might not have cost him much, but it did cost shorts and longs alike. I would definitely say he owes his investors but I definitely don't want anymore of his brand of help!

 

[BioSehnsucht]

Now this is ironic, not a peep from the media? And this is a worldwide actual recall on the brakes?

BMW recalls vehicles worldwide because of potential problems with the brake lines - China Certification – CCC mark certificate (3C) for China – Your expert for China Compulsory Certification

umm, welcome to the 21st century Bimmer, where’s over the Air Updates, still stuck in the dinosaur age?

Well to be fair, if it's a problem with brake lines, no OTA is going to fix that.

 

[Sudre]

Totally spitballing here but what if, after the yuuuge profitability of Q3, Tesla announces an immediate and substantial stock buy-back? That would hasten the much-anticipated squeeze, although from a strictly operational perspective it mightn't be easy to justify

My opinion ....

The stock would start to shoot up. The SEC would halt trading for a few hours and the rise would be stopped because traders would assume the SEC stopped trading because something was legally wrong with the tweet. The shorts would then walk the price down with huge media short fanfare about how Elon is going crazy over the coming weeks. Then the DOJ would supposedly subpoena Tesla and Elon.

Much later it will be revealed that Elon and Tesla did nothing legally wrong and the SEC just stopped TSLA trading for no reason except the price was going up to fast for some. I mean much later because how long does it actually take for the SEC to look at the documents Tesla sends them and decide if the tweet is a lie or true?

 

[Fact Checking]

Incorrect, due to the false info in the tweet...

Two weeks after the tweet Silver Lake and Goldman Sachs presented a going-private proposal to the Tesla board, with up to 30 billion dollars of funding not just secured but committed by investors as well.

This is what Elon tweeted:

• "Am considering taking Tesla private at $420. Funding secured."
  
• "@FredericLambert I don’t have a controlling vote now & wouldn’t expect any shareholder to have one if we go private. I won’t be selling in either scenario."
• "@Gfilche My hope is *all* current investors remain with Tesla even if we’re private. Would create special purpose fund enabling anyone to stay with Tesla. Already do this with Fidelity’s SpaceX investment."
  
• "@heydave7 Absolutely. Am super appreciative of Tesla shareholders. Will ensure their prosperity in any scenario."
  
• "Shareholders could either to sell at 420 or hold shares & go private"
  
• "@MindFieldMusic Def no forced sales. Hope all shareholders remain. Will be way smoother & less disruptive as a private company. Ends negative propaganda from shorts."
• "Investor support is confirmed. Only reason why this is not certain is that it’s contingent on a shareholder vote. "

(Emphasis mine.)

What made you think that going private was certain? It wasn't, as Elon made it abundantly clear in the first tweet already.

In the end it didn't happen because many institutional shareholders argued that staying public is better, and because it would also have forced out many retail investors. Funding was never a real constraint - shareholder support was.

Had you said that you wish he didn't inform shareholders about the going private process then you'd have a point, but your claim that he wrote "false info" is blatantly untrue.

Note that if he didn't tweet about it, such huge news would probably have leaked anyway, at which point he'd have been attacked for not informing shareholders. Attacking him for transparency is really unfair, I think.

Also note that him keeping the going-private process secret and him not caring about retail investors might have wiped you out: if you had DOOTM call options, those would have had zero value when going private.

Elon informing you about the process allowed you to change your options trade to not be wiped out in case Tesla goes private ...

Elon had been talking about a private Tesla for years, and in the end I'm glad Elon allowed shareholders to change his mind about something he had such a strong opinion on - it's a rare trait.

Elon made plenty of mistakes over the years, which he frequently admits to, but he also created a *sugar*-ton of shareholder value in the process and is nowhere near done with the value creation yet, he has barely begun.

You too should really learn to take responsibility for mistakes and inherent risks in your own investment decisions and stop blaming Elon for the tweet ...

 

[Zhelko Dimic]

Oh I think many shareholders have done just fine with TSLA. Elon doesn’t OWE any of us sh!t.

Sure, a lot of us are doing awesome!!!

 

[Fact Checking]

Totally spitballing here but what if, after the yuuuge profitability of Q3, Tesla announces an immediate and substantial stock buy-back? That would hasten the much-anticipated squeeze, although from a strictly operational perspective it mightn't be easy to justify

Guys, let's be realistic:

• IF Q3 is going to be profitable, it's probably going to be by a small margin. All Street estimates are predicting a loss in Q3 currently, and it's bullish analysts with frequent buy recommendations...
• Previously Elon defined the break even point at 5k/week sustained, but Q3 guidance is around 4k/week. They evidently do think they can manage it, but it's not a slam dunk by any means, and a "yuuuuge" profit is unlikely.
• It's an entirely possible outcome that Tesla makes a narrow GAAP loss in Q3 but becomes cash flow positive and increases cash equivalents.
• Stock buyback is going to happen in the form of paying back convertible notes in cash, instead of paying them in new shares. In March 2019 there's $920m such convertible notes to pay, and Tesla needs to save cash to pay those.

Any other form of stock buyback is wishful thinking.

Narrow Q3 profitability and positive cash flow would be huge results already, which falsify 80%-90% of the short thesis variants I've seen so far.

 

[sdtslafan]

Forget the stock buyback, I’m dreaming that Tesla is going to build more service centers with that money, because otherwise this business plan is not sustainable. The exponential part of the ramp is great until those cars need to be serviced in addition to cars from as far back as 2012. I don’t see how Tesla can service all these cars. Each year, there will be a half million or greater new cars on the road but the same number of service centers. Something doesn’t add up. Explain to me how this is going to work please...