TSLA Market Action: 2018 Investor Roundtable

[Beltsbear]

Timing is also helping Tesla. With tax credits expiring, pulling some demand in the US forward and starving regions or outside the US over the last half of 2018. Starting Jan 1, the tax credits are still there just a bit smaller and pent up demand in Europe should ease the China pain. By mid 2019, either the tariffs are solved and/or Tesla releases 120D on 2170 with refined interior and HUD. Tesla had always been supply constrained with S/X and they gave always shifted deliveries to where it made the most sense.

Tesla could come out with a P120D using the old form factor cells. The chemistry inside the cells can be upgraded while continuing to use the existing form factor and manufacturing lines for it. This preserves the 10gwh yearly production until they are not constrained on manufacturing. I expect them to be constrained through all of 2019 even with new lines added to GF1. Heck, they will be constrained in 2020 if they actually start building semis even with many new lines at GF1.

 

[Artful Dodger]

So then, the top question on most people's minds right now is "what happens tomorrow, and the day after the Earnings call?" To get some guidance from the recent past, this table presents the Top 5 Day-over-Day Gainers for 2018 TSLA YTD:

Today (Oct 23) was the 4th largest day-over-day gain for TSLA in 2018. The top five days this year were, in order:

1. Day after Q2 Earnings + Conf. Call
   
2. Day SEC settlement announced
3. Day of the 'Taking private' tweet
4. Today: Q3 Announc. & Short Reversal
5. Tesla AGM shows a confident Elon Musk

So what can we take from this?

• Clearly, on big news days the upside approaches $50
• Markets do NOT like the SEC nosing about
• 3 things move the market in a big, sudden way:
  
  • Financial Reports move the market
  • a Confidence CEO moves the market
  • reversals in sentiment move the market

I suggest Wed/Thu will be moving daze. Trade accordingly, and good luck to all.

Cheers!

 

[Boomer19]

They will upgrade their machines for 2170, or continue to make cells for other autos. Doubt they would just shut it down completely.

My theory, and I know it's nuts, but my theory is that Tesla will continue to sell the 100D as 18650 and come out with a P120D to start, then straight 120D. They will get rid of the 75Ds at that point as those are replaced by higher end model 3s in terms of price and market segment.

10GWh is what Panasonic makes in 18650s, so that's a lot of cells to just cut off completely. So I expect at the very least that they will make cells for other car makers.

the 18650s are proprietary to tesla.

but even so, i guess they can change them a bit for another manufacturer and get around that. i’m not sure why were questioning what happens to the 18650 anyway, i guess it will just end of service, end of life, like many other products.

But,
until the S & X conversion to 2170 occurs which, may be a few years.
- i think even elon said it’s no simple redesign, 2170 are taller
- your plan isn’t so crazy. keep full utilization of the pana japan shop..up the range on the flagship cars.
customers aren’t going to really care which format and chemistry they’re getting (even if the 18650 has more cobalt, ok, then take your engagement ring off dear, sorry)
- gives tesla more time to expand gf1, start gf3, feed some of the demand for Tesla Energy, which is in dire need.
(i’m assuming over time TE will be using 2170s exclusively)

 

[winfield100]

Maybe a strange time to ask, but does anyone have any clue what happened with the large amount of projects going on in Puerto Rico? Has Tesla already received revenue from that?

spoke to my solar installer today, there is a lot of stuff going on in Puerto Rico vis a vis electrical grid and PV n such

 

[ZachShahan]

I think it's as he says, to simplify production, so they can make, and sell, more S&X's.

Maybe after this 3rd qtr. Elon be likin' makin' money and wants 2018 to be a killer year so there can be no question that Tesla is self financed. The best way to shout out the doubters is to walk the talk.

I hope at least ...

Right, something we haven't discussed in a while is whether high Model 3 sales are leading to more S & X demand. Hmm ...

 

[ZachShahan]

The shorts are turning on their own: Why Citron Is Wrong on Tesla

Wahlman's claiming that Left is just being an opportunist and that he's jumping ship due to the threat of a profitable Q3. He think's it's just a temporary blip and all part of the show. wahlman and spiegel are still in denial. I'd love to see the looks on pablo santos and montana skeptic's faces as they realize their potemkin village is collapsing!

That means, the retail shorts haven't capitulated yet. Tomorrow will probably be a holding pattern or a slow SP rise until earnings.

I'm guessing Speigel bails before Wahlman.

 

[UnknownSoldier]

I'm guessing Speigel bails before Wahlman.

Doesn't Smeagol only have puts now? There isn't any bailing to do I guess, when his puts go to zero, that's the end.

 

[bdy0627]

I'd cool it on goading the shorts. I'm a long and a TSLA bull for sure but I've seen this a bunch of times .... I'm really hoping that we see some positive earnings tomorrow but I'm POSITIVE there will be plenty in the report to spin as negative ... there always is.

Long term I think we are in good shape and I think Tesla in 5 years will be very profitable and the leading car manufacturer in the world .... what happens in the next few months is anyone's guess and let's face it ... recent shorts have been winning. Of course I'm talking about those that shorted when we were in the mid to high 300s. Many of them still have profit and are not in panic mode at all ....

Not trying to rain on anyone's parade but let's keep this in check .... Tesla is a volatile stock and company ... it's got HUGE upside potential but it's also still risky.

Cheers to the longs

I think this is prudent advice. Volatility is not going anywhere. We may hit $315 tomorrow night and then drop well below $300 again Thursday. Expectations for this earning's report have suddenly gone through the roof. Are they going to be that spectacular? I don't know. I think they will be solid. Remember, Q4 is supposed to be the real stunner. There will be some momentum for sure because of the intensity of this 180, but when we hit resistance, shorts will be piling on again with vengeance. Prudent to take some profits at some point to be able to take advantage of the shorts' shenanigans.

 

[defc0n]

spoke to my solar installer today, there is a lot of stuff going on in Puerto Rico vis a vis electrical grid and PV n such

It felt for awhile that Tesla was doing huge things there and then we never heard anything else about it. Has still been in the back of my mind.

 

[Singuy]

I think this is prudent advice. Volatility is not going anywhere. We may hit $315 tomorrow night and then drop well below $300 again Thursday. Expectations for this earning's report have suddenly gone through the roof. Are they going to be that spectacular? I don't know. I think they will be solid. Remember, Q4 is supposed to be the real stunner. There will be some momentum for sure because of the intensity of this 180, but when we hit resistance, shorts will be piling on again with vengeance. Prudent to take some profits at some point to be able to take advantage of the shorts' shenanigans.

Lots to look at this ER. Profitability is only part of the picture. Lets not forget the guide. Our last guide was pretty spot on from a company that usually under deliver. What will q3 guide look like now with MR into the mix? We haven't seen a major uptick in production numbers..from mid 4k to around 5k in a quarter which means there's a bottle neck somewhere(most likely batteries). So are we going to see 7-8k/week numbers in Q4 with the help of MR and new lines coming online at GF1? There might be all sort of surprises in this ER beside just profitability.

 

[ZachShahan]

Short-seller Andrew Left is now long Tesla — but he's making a potentially disastrous mistake

Aww Business Insider, at least we can rely on you to throw water on a parade. Mm-mmmm!! that's some good fossil fuel money!

DeBord
Matthew DeBord

smh

Author of the 2017 book "Return to Glory: The Story of Ford's Revival and Victory at the Toughest Race in the World." When will BI fire him?

 

[RobStark]

 

[MXWing]

I think this is prudent advice. Volatility is not going anywhere. We may hit $315 tomorrow night and then drop well below $300 again Thursday. Expectations for this earning's report have suddenly gone through the roof. Are they going to be that spectacular? I don't know. I think they will be solid. Remember, Q4 is supposed to be the real stunner. There will be some momentum for sure because of the intensity of this 180, but when we hit resistance, shorts will be piling on again with vengeance. Prudent to take some profits at some point to be able to take advantage of the shorts' shenanigans.

Q4 isn’t going to be worse than Q3 and guidance will reflect that killer tailwind.

They can provide updates on the MR orders which is Q4 revenue recognition.

You can sell at whatever but it’s a big assumption to just get shares back at 300.

Historically, this is a safe bet but not sure if I want to bank on past performance leads to future performance.

When is Amazon going to be sub 1000 again? That was a huge wall.

 

[ZachShahan]

I bought more shares today near the HOD. First purchase in at least a year. If Left is really switching sides, this could be a game changer in other shorts bailing due to strong fundamentals.

Before I bought, I had to think about whether Tesla is at risk for a near term demand issue on Model 3. It seems obvious that production outran demand on RWD LR Model 3 in North America, unless the change can be purely attributed to cell supply constraints but I doubt that. But they have not yet opened orders in the rest of the world. I think they are wanting to maximize US. tax credits before supplying the rest of the world. So they introduced MR.

But I think this car will sell gangbusters in the rest of the world. So near term demand is not an issue. Fundamentally they are looking very strong. I hope Left is long for the long-term and not pulling a pump and dump. We shall see.

Have been thinking about this a lot (of course). I agree it is aiming to maximize tax credits and then can start shipping to Europe, China, etc. I don't remember perfectly what happened with Model S, but think there was a similar approach, and by the time Tesla was ready to ship to US again, word of mouth had blown up demand. Then a case of back and forth up to a stable demand level.

Mid to long term, it's practically impossible to see the Model 3 not selling at ridiculous volumes — TCO of a Camry or Prius and far better. I just wonder sometimes how long it will take for 50% of the market to become aware of the car, that it's available NOW, that its TCO is so low, and that its performance and overall quality is so wicked.

 

[ZsoZso]

So, when will the SEC sue Andrew Left for manipulating TSLA and harming the shorts ?
His performance today has moved the market much more than Elon's tweet in August!

ps: and I bet he will cash out on the gains (pump & dump) pretty soon, unlike Elon

 

[wipster]

Right, something we haven't discussed in a while is whether high Model 3 sales are leading to more S & X demand. Hmm ...

We may find out tomorrow... why don't you ask him Zach?

 

[Thekiwi]

I think this is prudent advice. Volatility is not going anywhere. We may hit $315 tomorrow night and then drop well below $300 again Thursday. Expectations for this earning's report have suddenly gone through the roof. Are they going to be that spectacular? I don't know. I think they will be solid. Remember, Q4 is supposed to be the real stunner. There will be some momentum for sure because of the intensity of this 180, but when we hit resistance, shorts will be piling on again with vengeance. Prudent to take some profits at some point to be able to take advantage of the shorts' shenanigans.

Profitability isnt the big number I think the market will focus on tomorrow (although it will be good if it happens - which I think probably will)

More important numbers in my opinion:

1.) amount of Postive Cashflow which I’m hoping will be at least $500 million, but could be substantially higher given the amount of vehicles delivered in final month of the quiarter (which helps cashflow more than cars delivered earlier in the quarter).
2.) Model 3 Margin - will it meet guidance, and if it beats guidance, by how much?
3.) Q4 guidance (I’m presuming at least 60,000 model 3 will be the low end target - but maybe the upper limit is a bit more than expected)

I think those 3 numbers will be more market moving than whether or not they were slightly above or below break even in Q3. But then again I’m usually wrong with anything involving Stock Price movement predictions.

 

[RFernatt]

Could moving up the ER date have anything to do with some type of co-announcement/agreement from the Saudi FII? Tomorrow should be interesting no matter what.

 

[dc_h]

I might consider selling a few shares if we get to 400 before tomorrow evening. But probably not.

Following the short squeeze rise to 269 I went for a long run and had an epiphany that Tesla had outrun its intrinsic value and I should sell some, but the following Monday the stock fell and I felt locked in and never sold. It’s 3 years later and I’m still here, but have added to my position. I have no special insight, but believe Tesla is below its intrinsic value now and any run up is likely more secular. Apple reaching ascendency in cell phones is like a bond or currency, once the brand is on top, its run will be long lived. Most brands that reach ascendence do so due to design and functional differentiation. Apple often lags in some innovations, but consumers, understand the solid performance and security that may be lacking in android phones. Apple is also a very holistic product, while other products are more limited or niche products. Tesla consumers see similar differentiation in design, safety, range, charging and innovation. Aspects like continual improvement are not normal options.
What I’m saying is that a bull run now will be different than the model S bull run. We now have a sustainable company, with cash flow to back up the corporate vision. That change should lead to a steadier longer run to some of the values some of our more loony bulls have talked about for years on the forum. I wouldnt mind a short squeeze, but would prefer a steady run to 500 into q1 and then a slow rise to 1000 as the China plant comes online. A secular brand lead stock run can last a decade or more and while there are still ups and downs, the trend is much more powerful than a short term tactical run. If there’s a short squeeze over 1000 this week, I might unload some shares and pick up some when we fill some gaps, but I think we are entering a new era for tsla.

Apologies if I’ve just jinxed the earnings report, but I do think we’ve entered a new phase, the beginning of the middle for Tesla. The beginning of the end is not likely for some time. Tomorrow, for good measure, I’ll publish a nice poem.

 

[defc0n]

I believe shorts will predictably once again attack the increase in accounts payable as the main reason Tesla is cash flow positive. I do not know if that attack will help them at all.