TSLA Market Action: 2018 Investor Roundtable

[EVNow]

Watching the price action in real time... it jumps up and down 1% within SECONDS. I can’t find another stock like this.

Yes, today tsla is all over the place - with big movements when Nasdaq moves only a little.

BTW, all the tech stocks I follow are green - except FB for obvious reasons (have no idea why anyone would even buy FB at this point).

 

[EVNow]

Dammit, why can't I manage to lose money??? :Þ

Start shorting tsla

 

[EVNow]

In some interesting market news …

Mnuchin thinks there's a simple reason the Dow is poised for its worst December since 1931
MARKETWATCH 7:04 AM ET 12/19/2018
Treasury Secretary Steven Mnuchin has weighed and measured the recent destruction that put the Dow Jones Industrial Average on track for its worst December since 1931, and he appears to have drawn his own conclusions as to the impetus.

Mnuchin during a Tuesday interview with Bloomberg News in Washington (Bloomberg - Are you a robot? 18/mnuchin-blames-volcker-rule-high-speed-trading-for-volatility) said that the effect of the financial-crisis-era Volcker rule and high-frequency trading have combined to sap liquidity in the market and insert an unprecedented measure of volatility in assets.

The Volcker rule refers to the controversial standards put in place to prohibit banks from trading for their own accounts, in the wake of the 2007-09 financial crisis, while high-frequency trading refers to superpowered computers engineered to execute transactions at lightning-quick speeds, which has become arguably the dominant force in the market over the years since its advent.

Back-to-back declines of more than 500 points in the Dow , beginning Friday, pushed the blue-chip benchmark deeper into correction territory, usually defined as a drop of at least 10% from a recent peak.

In fact, if the Dow were to finish the month at its current level, down about 7%, it would mark the worst December since 1931, when it fell 17.01%, according to Dow Jones Market Data.

 

[neroden]

OT:

To be objective and if Xian is typical, it is still extremely polluted. If you think it has improved tremendously it must have been quite unlivable before.

It was quite unliveable before. In 1986 in Beijing you had to wear a mask all day every day and you still ended up with black gunk on the *inside* of the mask. It got WORSE after that.

 

[neroden]

OT

Gotta love stock analysts.
Adam Jonas is ranked #516 out of 5,100 Analysts on TipRanks with a success rate of 49% and an average return of 8.1%. He has been maintaining an equal-weight rating on Tesla’s stock over the last year:

And Tamberrino is even WORSE.

So basically this guy is slightly worse at picking stocks than a monkey with a dartboard.

For those who are curious: The WSJ ran a "dartboard portfolio" in the 1980s and 1990s.

It not only beat 90% of all analysts, it beat nearly all index funds.
(This is currently believed to be because the dartboard metholodogy naturally overweights small-caps and microcaps.)

So, a monkey with a dartboard is actually a pretty good investment technique, it turns out.

 

[neroden]

I am hesitant to subscribe to conspiracy theories, but for those who would like to see Tesla fail, this provides an interesting reason as to why short sellers / antagonists would like the stock price to remain as low as possible through March, as it becomes a way for the stock price to directly influence the company's bottom line.

Keeping the stock price below $360 through Feburary would mean Tesla would be about $460 million lower on cash flow (though some bondholders might convert even if the stock is below $359.87, if they expect the stock to go up and want to defer capital gains or gain a long-term holding period instantly). Given that Tesla is awash in cash now, I don't think this is a big deal but the short-sellers probably do think it's a big deal.

 

[KarenRei]

OT

(Sorry for the OT tax stuff... but I figure that a discussion of tax implications is probably useful to a lot of other people here since we're nearing the end of the tax year.)

I noticed this mentioned in one article:

The capital loss may be used in the year it is incurred, carried back 3 years or carried forward indefinitely

Well, that gives some possibilities for my citizenship-ending "exit" tax return next year

At the very least, it sounds like I should be able to resurrect my never-reported, never-claimed business losses from nearly a decade ago. Assuming I can find documentation of them...

 

[neroden]

OT

It would be very exceedingly easy to crack down on that by:

• Make analysts communicating material information improperly a case of insider trading - right now analysts are exempt from insider trading regulations...
• Give full immunity and anonymity to whistle blowers and offer a bounty of 10% of any fines or settlements collected through resulting administrative action.
• When two firms collude illegally, give full immunity and zero fines to the first firm that reports the illegal cooperation to the SEC.
• Ban affected analysts from the securities markets for life.

Analyst related market manipulation would stop in a heartbeat, after a few cases of employees simply cashing out $10m-$30m from a $100m-$300m fines and the affected analysts being barred from the securities markets for life. The best analysts would insist on being housed separately and not have any communications with people in the trading arm of the firm...

All of these could be done by the SEC improving their own regulations - none of these require legislation. Guess why it's not being done?

Personally I support "money where your mouth is" regulations: analysts should be required to put substantial parts of their personal wealth into the stocks they analyze, unhedged, and without compensation by their employer for losses, and should be required to disclose their trades. I think that would solve all the conflicts of interest. If GS is buying TSLA and the analyst gets a "wink wink nod nod" to issue a "sell" report on TSLA, he's not going to do it if he has to sell TSLA himself.

It's a pretty radical idea though.

 

[neroden]

OT

We should also mention that Q3 ended on a Sunday, so that payments for 2.5 days of deliveries (Friday 4pm to Sunday Midnight) weren't posted to Tesla's bank account until Mon, Oct 1st which was in Q4.

Unfortunately, Q4 ends on New Year's Eve. Some banks close on New Year's Eve, though apparently most of them don't. The day before is a Sunday. I wouldn't bet on all transactions posting on New Year's Eve.

That could be literally thousands of Model 3s, perhaps $60M dollars per thousand deliveries? Elon tweeted the intention to deliver 1,000 cars per day in the final week in California alone. That could be a $150M head-start to Q4 cash flow!

Mayyybe. Or maybe the cash flow will come through on January 2.

 

[defc0n]

Why would Tesla not go up if the market does ? Infact won't be surprised if Tesla goes up more than others. Afterall, it has gone down more.

I'm playing it safer based on what I see in technicals. TSLA is certainly giving the impression of moving down again after reaching yet another candle top. The market is filled with stocks that may have reached a bottom while macros have tanked to their bottom. TSLA is not one of those at this moment.

 

[Artful Dodger]

Yes, today tsla is all over the place - with big movements when Nasdaq moves only a little.

BTW, all the tech stocks I follow are green - except FB for obvious reasons (have no idea why anyone would even buy FB at this point).

Yeah, kinda starting off like Nov 28th:

 

[anthonyj]

This bounce is weak af. Market is ripping and Tesla is starting to fade.

 

[neroden]

I wouldn't discount Adam Jonas completely. He's not a perma-bear, he's been on both sides.

I discounted him completely when he was bullish.

Specifically, he was assigning a multi-billion dollar valuation to a mythical "Tesla Network" of autonomous taxis, while *simultaneously* valuing the Powerwall/Powerpack business, which was *already profitable* and had a long waiting list, at $0.

I concluded that he's just crazy.

I don't know if he's right, I don't know his current motivation, but he does move the market, and in general, seems to genuinely tries to do the good job.

He's just incompetent and crazy. I think MS likes it that way. That way he can move the market in a direction opposite to what MS is trading *by accident*, with nothing illegal done at all. Nice trick, hiring an incompetent analyst deliberately so as to give your company better trading opportunities -- and totally legal. No way to stop it.

He used to have very high price target, based on 'mobility theory'. His bull case is even today $450 or so...

 

[neroden]

Something that I've been thinking about today, given the more bearish macro environment, is that TSLA over the next few quarters might be in a cycle where the price jumps on enthusiasm following a profitable ER, but over the quarter that enthusiasm fades as questions arise regarding continued demand, broad selloffs within equities, other various Tesla-specific questions, until the stock price jumps following the next profitable ER, etc., etc.

Thoughts?

Perfectly likely. If so, you could buy low, sell high Or harvest volatility while managing maximum exposure.

 

[MarcusMaximus]

Keeping the stock price below $360 through Feburary would mean Tesla would be about $460 million lower on cash flow (though some bondholders might convert even if the stock is below $359.87, if they expect the stock to go up and want to defer capital gains or gain a long-term holding period instantly). Given that Tesla is awash in cash now, I don't think this is a big deal but the short-sellers probably do think it's a big deal.

I dunno, man, did you see that chart they made the other day?

 

[Nocturnal]

OT


And Tamberrino is even WORSE.



For those who are curious: The WSJ ran a "dartboard portfolio" in the 1980s and 1990s.

It not only beat 90% of all analysts, it beat nearly all index funds.
(This is currently believed to be because the dartboard metholodogy naturally overweights small-caps and microcaps.)

So, a monkey with a dartboard is actually a pretty good investment technique, it turns out.

I was introduced into this notion way back after reading The Pillars of Investing. The same lessons were reinforced in business school. There is a reason why I do all of my investing in index funds. (except for my overly risky and overly heavy TSLA ownership)

Why pay fees to a fund manager just to have him to match the market return in the long run?

 

[Curt Renz]

I first published this in the Technical Analysis thread, but it may bear repeating here.

Craig Johnson is a managing director and the chief market technician at Piper Jaffray. He was a regular guest on my TV show and still sends me his newsletters. He is the one who pointed me toward a TSLA position in early 2013. Today he came out with a special note summarized below.

Summary: We believe conditions are right for an intermediate-term market bottom. We raised our recommended equity exposure to 90% from 85% this morning.

A bottom appears to be developing in U.S. equity markets. Oversold conditions are widespread, bullish divergences have formed in momentum, market breadth has deteriorated to historically washed out levels in our technical work, and bearish sentiment is at extremes. Based on the overall weight of the evidence, we believe investors should tactically deploy capital back into stocks. Rationale for this call and several stocking stuffer trade ideas are included in the following research.

 

[astrokatship]

This is definitely more a factor of click bait headlines and stories than reality.

If the reality matched the click bait stories, they would not have the success they have had.

I agree! The news, and maybe a few chip-on-their-shoulder, can't-cut-it, complaining-type former employees -- out of 10's of 1,000s of employees -- are not reliable sources for the truth.

 

[viridi]

So, a guy who never seems to be correct when it comes to Tesla, and also seems to have a pretty poor track record as a whole, is able to tank a stock. Simply amazing the damage this guy has done without any historical support for his having a knowledge of the company that he continuously bashes. From the below link:

David Tamberrino
Goldman Sachs
Wall Street Analyst
Ranked #4,399 out of 5,107 Analysts on TipRanks(#10,471 out of 11,683 overall experts)

https://www.tipranks.com/analysts/david-tamberrino

Maybe the markets are relying more on the MS report from Adam Jonas. But even he has not been all that accurate on Tesla as of late. I am not sure how the views of these two guys outweigh all the positive analyst reports that have come out recently, and, more importantly, all the positive information that seems to be in the market around Tesla these days. In my view, there is nothing that justifies the precipitous decline over the last few days, and there was much to justify the dramatic increase in price before the unfounded decline. Hopefully rationality takes over in what seems to currently be an irrational market for Tesla's stock.

 

[Todd Burch]

This bounce is weak af. Market is ripping and Tesla is starting to fade.

Up <1% is ripping?