Debt is GOOOOOD, if it's cheap. At this point, some corp for that at 475bps would be a nice deal. I'd take that. They might be able to convince people they can pay it. Or put in another conversion option for 475$ in two years. Debt can be good..
I must be a masochist for trying to point out a simple truth about model 3 gross margins during celebrations. I'm gonna stop and I'll try it again when things cool off. I'm certainly not saying they are BAD, just neutral at best. Great quarter in every other respect that I can figure out. Heck even Ford going up is going to help us I bet.
Ford misses guidance and raises 5.75% This is what happens when you give one family a bunch of money. Except they didn’t earn it. Some dude decades ago did. Now we can prop bullshit up
I usually use the MarketWatch live blog. I know, I know. They still have a good live earnings blog despite everything else being horrible there.
Should I sell my remaining position which is at $295.00 or hold and wait and accumulate more shares??
Well, to be fair to @tivoboy holding debt can be profitable. An easy game is playing with other people's money: take out a loan and as long as you have a return higher than the interest you come out ahead by the difference. Whether or not it is warranted for Tesla? There's so many perceptions, such as the one that you mentioned, that it becomes hazier. But he is on solid economic ground.
From the letter "Production in China will be designated only for local customers." I know a lot of Australians, New Zealanders, and other Asians were saying they would not buy or strongly reconsider Model 3 if only Made in China versions were available locally.
Key words are 'portions of'. They're not going to fully produce cars in China in 2019. That's crazy talk. Probably final assembly, that sort of thing. I love that this shareholder letter was clearly written to take apart the naysayer arguments: -Minimal ZEV credits. Can't say the net income came from ZEV. -Shows Model 3 the #1 vehicle by revenue -Calls out stable production despite introduction of AWD and reduction of labor hours. It's tough to get too worked up about missing production goals when the product mix and margin skyrocketed (way past Q3 guidance for margin). -Nukes the 'parking lot' theory directly -Calls out the crazy trade-up trend for Model 3, as well as the fact that Europe's market for the 3's vehicle class is > 2X the US's, and that orders are coming in the next two months for Europe/China. -Directly addresses the vehicle efficiency deficiency of new 'competition' (eg I-Pace). -Reaffirms guidance for profitability in Q4 -Cash/equiv = $3.5B, and guided to increase significantly in Q4 while paying off $230M in notes during Q4. What was that about March notes? Other things I like: -They guide for increased Model 3 production/deliveries, but do not tie themselves to a specific wildly-optimistic number. With such a positive report, I'm glad they didn't include unnecessary poison pills like that. -Reaffirms that they plan to increase service infrastructure investment in Q4. I was a tiny bit afraid that they were going to keep up with the minimal expansion for another quarter, and I don't think they could afford to do that given the sales volume. If I had to find a complaint, it's that... Uhh, OK, how about that the solar roof is still clearly not ramping in any significant way. Yeah, that's the ticket. Hang your hat on that, shorty air force. At the risk of creating a disturbance in the force, I'm whipping this puppy out once more...
Here "neutral" is comparing a rosy and reasonable projection (because it's a rosy car) to an even more rosy actuality. That's like saying "I'm really healthy today, even better than yesterday!" is neutral, because I was really healthy yesterday.