TSLA Market Action: 2018 Investor Roundtable

[Cosmacelf]

What time is the share holder's meeting tomorrow?

Dan

2:30 pm PDT.

 

[TrendTrader007]

Both $TWTR and $NFLX started rising 6 to 9 months in anticipation of their additions to the S&P 500 index today. As predicted in July of 2017, $TSLA will join in 1Q19, so the stock will start anticipating this right about NOW.

ValueAnalyst on Twitter

That’s right. The rally has already started and expect to see $500 by year end 2018

 

[neroden]

This is a regular occurrence in finance and market research. Banks and retailers sell their anonymized databases for big buck so that agencies can create reports and sell them for even bigger buck. There are companies that gather anonymized databases from multiple big retailers and then merge them together trying to identify buying behaviours of customers. Those are worth millions.

I'm not surprised, but this largely confirms my belief that government has been way too lax regarding private corporations collecting data on their customers. A crackdown is necessary, with broad bans on this kind of thing.

 

[sundaymorning]

GM self driving tech has issues that Tesla has, we just don’t hear about them.

GM settles with motorcyclist over accident with self-driving Bolt

When GM gets their hands free stuff on the road, that’s when it’ll get really interesting.

 

[JRP3]

That’s right. The rally has already started and expect to see $500 by year end 2018

Didn't you say the same thing last year?

 

[neroden]

Last I checked you need 4 quarters of positive earnings to get into the S&P500

Nope. Sum of the past 4 quarters has to be positive and the most recent quarter has to be positive.

Just checked the authoritative document:
https://us.spindices.com/documents/methodologies/methodology-sp-us-indices.pdf

So, if we see a loss in Q2, a narrow profit in Q3 and a large profit in Q4 and Q1 2019, it's possible for the sum of Q2/Q3/Q4 2018 and Q1 2019 to be positive, qualifying TSLA for the S&P 500.

 

[EnzoXYZ]

One becomes a fan when they learn about Tesla, one becomes a fanatic when they own the car.

Thanks for the update, give us more news whenever possible from Germany please.

Totally disagree! I’m a fanatic without even driving one.

 

[CuriousSunbird]

And you’re an analyst for who?

Me, myself & I (but until last year one of the IBs)

 

[EnzoXYZ]

If a media company in China made up the story with a report about "Chinese Ministry of Commerce confirmed" , then this media will be in deep *sugar* trouble.

AKA they go missing for a long time. If they return at all.

 

[CuriousSunbird]

Indeed. I thought the bear criticism was all about Tesla being a cashflow disaster? It’s a strong positive if Tesla can finance its aggressive growth from creditors and upfront customer receipts, rather than debt or fresh equity. I’ll be focused on the working capital numbers too, but seemingly for opposite reasons to Mr Sunbird.

The problem with large working capital deficits is that they can very quickly turn into cash flow crises

 

[Singer3000]

The problem with large working capital deficits is that they can very quickly turn into cash flow crises

But this is only a problem if you think Tesla is about to lose the confidence of its customer base and suppliers. Which brings you back once again to demand and the ramp. It’s layering the same arguments on top of each other again.

 

[TrendTrader007]

Apparently Whitney Tilson thinks $TSLA is a decent short right now
This is the guy who shorted $TSLA at $30 in 2013 and covered at 500% higher in 2014
Great contrarian indicator
I would be going super long on this news alone
Plus the 2 hourly charts look fabulous
I bet tomorrow is the last day sub $300
Shorts had their chance and they blew it
$TSLA longs will take over now

 

[MTL_HABS1909]

Apparently Whitney Tilson thinks $TSLA is a decent short right now
This is the guy who shorted $TSLA at $30 in 2013 and covered at 500% higher in 2014
Great contrarian indicator
I would be going super long on this news alone
Plus the 2 hourly charts look fabulous
I bet tomorrow is the last day sub $300
Shorts had their chance and they blew it
$TSLA longs will take over now

It’s just funny that you would call someone else a contrarian indicator...

 

[AudubonB]

Short sellers got no reasons
Short sellers got no reasons
Short sellers got no reasons
To sell

They got little hands
And it isn’t a surprise
That they go around
Tellin' great big lies

They got little morals
And tiny little hearts
And they keep repeating
(This is the most amazing part):

Well, I think that it ain’t worth nothin’
‘Cuz Stanphyl told me that it ain’t worth nothin’
Well we don’t need no Mark B Spiegel
Keep repeating that tired old spiel
Round here

....and Wipstah’s to blame!

 

[CuriousSunbird]

But this is only a problem if you think Tesla is about to lose the confidence of its customer base and suppliers. Which brings you back once again to demand and the ramp. It’s layering the same arguments on top of each other again.

Sort of. To manage the working capital deficit Tesla has to maintain the confidence of all the short-term liability holders - suppliers, depositors, financiers. Lose any one of the legs and there will be a problem.

But I think that would be manageable. Musk can always fill the hole himself. Long-term demand is the main question for me.

 

[AlMc]

Short sellers got no reasons
Short sellers got no reasons
Short sellers got no reasons
To sell

They got little hands
And it isn’t a surprise
That they go around
Tellin' great big lies

They got little morals
And tiny little hearts
And they keep repeating
(This is the most amazing part):

Well, I think that it ain’t worth nothin’
‘Cuz Stanphyl told me that it ain’t worth nothin’
Well we don’t need no Mark B Spiegel
Keep repeating that tired old spiel
Round here

Audi, you, of all people here, should know that poetry/songs/rhyming is prohibited in the investor's section

 

[jhm]

I'm not surprised, but this largely confirms my belief that government has been way too lax regarding private corporations collecting data on their customers. A crackdown is necessary, with broad bans on this kind of thing.

Indeed, I think one of the key impaired parties in this are ordinary shareholders of public companies. For example, suppose you invest in Amazon. As an ordinary investor you wait for quarterly reports, meanwhile well funded hedge funds buy this sort of data to track sales on a near real time basis. This is a huge information asymmetry, which is trading on non-public information. Where the heck is the SEC?

Was this data already tipping off certain shorts to attack Tesla on grounds of "conversion" rates? As I have argued before conversion rates are quite misleading in a situation where customers are waiting considerable time for certain product configurations to become available. A cancellation rate would be much more concrete and measurable in real time. But those launching this attack seemed to avoid framing this as a cancellation question. Perhaps this would have been too much of a tip off that they had NPI visibility Tesla's transactions with customers.

As others have pointed out, this report is actually not so bad. So my beef is not with that. Rather my concern is that this is a violation of corporate privacy that puts ordinary shareholders at an information disadvantage. How the shorts played this was to insinuate more than what the data would bear out, but we were at a disadvantaged to defend the stock against this insinuation because of information asymmetry.

 

[Zhelko Dimic]

The problem with large working capital deficits is that they can very quickly turn into cash flow crises

Look, you're right, Tesla has problems and plenty of risks ahead of them.

What you seem to discount is that there are smart people at Tesla working on making sure risks are taken care of. It's not like they're unaware of cash crunch and other risks.

And you can continue betting that it's been sheer luck that they're survived so far. However, consider that in many elements they're ahead of the whole industry that was widely believed to be impenetrable to newcomers; they brought first desirable EV car, first 17" tablet, first autopilot, first OTA in the industry, first centralized unified computer platform for car/entertainment system... Is that work of the people that stumble they way through life?

So, my bet is that they know what they're doing (kinda, most of the time, while making plenty of mistakes), and they will continue to defy the odds...

Could they fail? Yes, but that will be if they themselves miss-calculate severely, and not because it's inevitable. The whole bear thesis seems to hinge on this inevitability, as if Tesla the company is on auto-pilot, but it's not. There are smart people piloting this ship, and they change and correct when needed. Tesla is not on autopilot, so waiting for it to crash is wasting time...

And this is also why you're not seeing $35K M3 yet. Was it's supposed to be here already? Absolutely yes. But so what? This is not an issue of a 'broken promise', it's not out of malice, it is set of business decisions necessary to keep company afloat; because people piloting this thing know what they're doing (mostly .

 

[wipster]

Short sellers got no reasons
Short sellers got no reasons
Short sellers got no reasons
To sell

They got little hands
And it isn’t a surprise
That they go around
Tellin' great big lies

They got little morals
And tiny little hearts
And they keep repeating
(This is the most amazing part):

Well, I think that it ain’t worth nothin’
‘Cuz Stanphyl told me that it ain’t worth nothin’
Well we don’t need no Mark B Spiegel
Keep repeating that tired old spiel
Round here

I feel proud to have planted that seed in your mind!

 

[Singer3000]

Sort of. To manage the working capital deficit Tesla has to maintain the confidence of all the short-term liability holders - suppliers, depositors, financiers. Lose any one of the legs and there will be a problem.

But I think that would be manageable. Musk can always fill the hole himself. Long-term demand is the main question for me.

And there’s not much point arguing over long term demand, since in the long term we are all dead. Respectable enough view to take, just one that most of us here disagree with. Given your background, where I’d hope you’d agree, is that what you are spinning as a negative indicator (negative working capital), will actually be a strong positive for the company if there is demand for the product. So if there is demand for 1mln/year (or 5mln for that matter), this feature will help them get there faster, with better capital efficiency and ironically enough, with lower refinancing risk.