TSLA Market Action: 2018 Investor Roundtable

[jhm]

Some above we talked about the voting buttons. I think the "like" button is redundant and should be replaced with "agree" to match the "disagree", the "love" button serves the function of "like". "Informative" and "helpful" are also rather similar, maybe replace one with "FUD"

FUD emoji

 

[avoigt]

Wow, just broke $300 in pre market. I have to admit I am a bit surprised. Didn't think there would be this much movement before the end of the quarter. Let's hope it keeps rising.

Dan

$303.15
4.13%

 

[sundaymorning]

Where do you see us trading tomo? I think the information we received today puts a floor at 288-290s, we will likely retest $300 again, my guess is that sometimes next week we’ll break out above $300 until confirmation of 5k, then it’s game on.

What I meant to say 7 hours ago was that the floor is reset to $298-300. jk I’m glad to be wrong and happy to see $300 return premarket. Could this be the signal to set a slow squeeze in motion?

Elon reaffirmed profitability and positive cash flow in Q3. We’re 24 days away from that quarter. If I were a short I would not wait to cover

24 days sounds about right, but what happens if VIN tracker spikes before quarter ends? FOMO on the squeeze of the century yet anyone? I’m not trying to plant a seed or anything

 

[Tslynk67]

Wow, just broke $300 in pre market. I have to admit I am a bit surprised. Didn't think there would be this much movement before the end of the quarter. Let's hope it keeps rising.

Dan

The SHMeeting re-iterated some important guidance, specifically the ramp and the Q3/4 profitability. As we're only 4 weeks from Q3 I think it would be inconceivable for Elon to reinforce this unless it was totally going to happen, so I take them as a given.

I just finished getting through the replay of the meeting. I thought there were some great questions this time, which led to informative answers. The idea to take questions from Twitter was really good, because of course you can cherry-pick the decent ones and use them as a general communication vehicle.

But Jeeze, who let the frickin' vegans in again? With Tesla we're used to the FUD from Big Oil, in the health, nutrition and sustainability world we have vegan FUD - don't believe a work of it folks...

 

[YasB]

And exponential growth two, doubling every year from here-on, supply-constrained based on GF1 output capacity.

Seriously, shorts need to leave the building... An advice.

Powerwall 2 including additional hardware and installation sells for something in the order of $600 / kwh, right? I think it's reasonable to assume, that large scale installations like the one in Australia sell for a much lower price. If we can agree on this, that puts an upper limit on the revenue and prices will probably continue to drop. Let's assume sales and price develop like this:

2018: 1 GWh, $600 / KWh
2019: 2 GWh, $500 / KWh
2020: 4 GWh, $400 / KWh
2021: 8 GWh, $300 / KWh
2022: 16 GWh, $250 / KWh

That would be $4 billion in revenue about 5 years from now. Let's apply a 10% net margin and you end up with something like $400 million in earnings per year. With a P/E of 20 that translates into something like $8 billion additional stock value. Let's say in 2022 there are 200 million shares and we arrive at a value per share of $40. Now you'd have to discount that back and adjust for possible risks resulting from tech breakthroughs, macro-economy, competition (hi Asia!), lower margins, rising interest rates and so on. That's even more of a guessing game. Hm ... let's just say $20 a share right now?

To be honest, i think there will be more than 200 million shares by 2022, but i won't mention that at TMC. I'm not THAT stupid! It may also be hard to sell storage at $250 / kwh 5 years from now. I mean you guys are assuming battery costs on the pack level to be well below $100 / kwh for automotive grade batteries by then. Of course, if you plug in different numbers or simply extrapolate that series until 2030 you may end up with any share price you want. But for now i decided that Tesla Energy is no reason to leave the building anytime soon. We'll see, maybe i'll move a bit closer to the exit when Q3 / Q4 approaches ...

 

[Starno]

301 pre market

 

[sundaymorning]

$303.15
4.13%

Breaking the $300 resistance before market even opens is a very ominous signal for shorts.

 

[Dan Detweiler]

The SHMeeting re-iterated some important guidance, specifically the ramp and the Q3/4 profitability. As we're only 4 weeks from Q3 I think it would be inconceivable for Elon to reinforce this unless it was totally going to happen, so I take them as a given.

I just finished getting through the replay of the meeting. I thought there were some great questions this time, which led to informative answers. The idea to take questions from Twitter was really good, because of course you can cherry-pick the decent ones and use them as a general communication vehicle.

But Jeeze, who let the frickin' vegans in again? With Tesla we're used to the FUD from Big Oil, in the health, nutrition and sustainability world we have vegan FUD - don't believe a work of it folks...

LOL!

When Tesla gets to the point that the most serious concerns regarding the car are whether the steering wheel has real cow on it or not then they will truly have arrived!

Yes, I found that question to be coming from left field and pretty petty, but...to each his/her own.

Dan

 

[DragonWatch]

Pre-market $302

There was an old tv commercial for an analyst that said, “when e. f. hutton speaks, everybody listens.” Well, I think it was e.f. hutton anyway; regardless, the same could be said about Elon, because everyone was listening, analyzing, over analyzing, and over and over again analyzing. As far as I can see ~ if the doors did not close, and if you have any long range perspective then and car grasp the past, then put your seatbelt back on for safety.

FYI ~ the semi is for long haulers and I am getting a charge out of it.

FYI ~ the Model 3 was once upon a time projected for 2020, if I recall correctly ~ so any Model 3s released into the wild today are gravy in my world, because it is 2018, just sayin’.

 

[gora321]

$303.15
4.13%

Squeeze baby squeeze

 

[AlMc]

Expect shorts to try hard for the MMD. They do not want this to get out of hand. Interesting day developing fellow longs.

 

[Dan Detweiler]

There will be more people watching the ticker tape parade today than a Game of Thrones season premier!

Dan

 

[Tslynk67]

Powerwall 2 including additional hardware and installation sells for something in the order of $600 / kwh, right? I think it's reasonable to assume, that large scale installations like the one in Australia sell for a much lower price. If we can agree on this, that puts an upper limit on the revenue and prices will probably continue to drop. Let's assume sales and price develop like this:

2018: 1 GWh, $600 / KWh
2019: 2 GWh, $500 / KWh
2020: 4 GWh, $400 / KWh
2021: 8 GWh, $300 / KWh
2022: 16 GWh, $250 / KWh

That would be $4 billion in revenue about 5 years from now. Let's apply a 10% net margin and you end up with something like $400 million in earnings per year. With a P/E of 20 that translates into something like $8 billion additional stock value. Let's say in 2022 there are 200 million shares and we arrive at a value per share of $40. Now you'd have to discount that back and adjust for possible risks resulting from tech breakthroughs, macro-economy, competition (hi Asia!), lower margins, rising interest rates and so on. That's even more of a guessing game. Hm ... let's just say $20 a share right now?

To be honest, i think there will be more than 200 million shares by 2022, but i won't mention that at TMC. I'm not THAT stupid! It may also be hard to sell storage at $250 / kwh 5 years from now. I mean you guys are assuming battery costs on the pack level to be well below $100 / kwh for automotive grade batteries by then. Of course, if you plug in different numbers or simply extrapolate that series until 2030 you may end up with any share price you want. But for now i decided that Tesla Energy is no reason to leave the building anytime soon. We'll see, maybe i'll move a bit closer to the exit when Q3 / Q4 approaches ...

My mistake, actually Elon said each year he sees growth equivalent to all previous year combined, so that's 1, 2, 3, 6, 12, 24...

Plus he also stated that margins, which are now very low, would begin to match automotive next year, to the 20-30% range.

 

[YasB]

My mistake, actually Elon said each year he sees growth equivalent to all previous year combined, so that's 1, 2, 3, 6, 12, 24...

Plus he also stated that margins, which are now very low, would begin to match automotive next year, to the 20-30% range.

That's gross margins then and only a fraction of it makes it to the bottom line. In the end it doesn't really matter, since we can't really know what revenue and margins will be. I was just trying to point out, that it's not really a reason for shorts to run away screaming and panicked, since for the forseeable future Tesla Energy won't be the thing that is driving the share price.

 

[ZsoZso]

Talking about fake news, here's the most twisted and biased critique of the shareholder meeting that one can imagine. The cherry picking from the meeting and slanted editing to create the impression of negatives is incredible. It's all the distorted FUD you've ever heard about Tesla packed into four minutes. It even presents quotes from the risk factors section of the recent financial statement. That section is included by every public company making it appear on the verge of bankruptcy at the insistence of lawyers. You may want to join me in the comments and reports sections below the YouTube presentation which already has over 21,000 views, 1000 likes and 1600 dislikes.

"Elon Musk almost lost his chairmanship of the company." That's just for a starter.

LOL, and The Verge has almost kept its credibility.... until they published this garbage

 

[TheTalkingMule]

That's gross margins then and only a fraction of it makes it to the bottom line. In the end it doesn't really matter, since we can't really know what revenue and margins will be. I was just trying to point out, that it's not really a reason for shorts to run away screaming and panicked, since for the forseeable future Tesla Energy won't be the thing that is driving the share price.

It will once the holistic product becomes more rounded. As Model sales ramp, Tesla is certainly going to push a lean all-in-one product with EV/solar/storage. Once they do, the level of interest will skyrocket.

I also see the Powerwall price being halved relatively quickly. If true pack costs can approach $100/kWh, why won't retail for a Powerwall quickly be $250/kwh in a leaner more scaled environment? I mean.....it's just a bigass battery.

 

[Phrixotrichus]

meanwhile one of the headlines on a lot of european news sites is about Tesla having to refund 23% of Model 3 reservations.
That Tesla will still be booked out for years to come is something you have to look for in the footnotes of those articles.

I´m a pretty pessimistic nancy myself, but what I see happening in the press lately concerning everything Tesla is close to calumny.

 

[Tslynk67]

I was just trying to point out, that it's not really a reason for shorts to run away screaming and panicked, since for the forseeable future Tesla Energy won't be the thing that is driving the share price.

If it were TE in isolation then at this moment in time you'd be correct, but you forgot about the rest of their business which is about to squeeze a few shorts where it really hurt...

 

[mach.89]

LOL, and The Verge has almost kept its credibility.... until they published this garbage

This video made me really angry watching it. Just unbelievable the way they spun what most of us Tesla scholars think was a very positive share holders meeting. You guys called it.

 

[ggies07]

Let me add to this. I followed this emotional moments as well and was like "wow, I never ever seen a CEO in public almost crying".

Why is that important? It is a prove that he is deeply personally tied to the company, his employees, customers and the success of his mission. This is not about numbers or specs or missing timelines that he regrets but about achieving something ex-ordinary and feeling accountable.

Year ago when I started investing in Tesla I told myself, well the outlook of that venture is more than uncertain and in fact (almost) all new car companies with great products did get bankrupt so its more about having a leader and visionary CEO that brings the best people, customers, suppliers, financiers together for a mission otherwise they will die. His emotional touch made me confident he could be the one.

He also got emotional at the 2013 shareholder meeting talking about the dealership model. Here is the clip: