TSLA Market Action: 2018 Investor Roundtable

[thisramp]

A Letter to Elon & the Team, from a minor investor.

Dear Elon & the Tesla team,

Usually on market down days like today I would clear my mind at the driving range, but my health isn’t what it used to be so I’m here thinking of you & the team. Bear in mind that the term “team” will also include Tesla shareholders as well as the 30,000 plus employees (ranging from management, manufacturing, mechanics, engineers, sales, customer service, etc.). The purpose of this letter isn’t meant to kick you when you’re down, it is meant instead, to lift your spirits as I have a feeling your morale could make good use of it during manufacturing hell.

Over the past 4-5 trading days the market may have over reacted to your possible miss guidance for Model 3 production of 2,500/ week vs. current rough estimates of 1,200 - 2,000/ week. While I know that you will eventually get it right and hit the ball out of the park, there are a plethora of people & institutions who desire nothing more than for you to fail. As if Tesla’s market cap alone isn’t enough to attract resentment, you are working in an arena looking to turn very established industries upside down. Hence, every miss-step will be magnified and scrutinized by bearishness in order to dissuade your heart from your mission. This is NOT the time to walk around NUMMI with your heads down; now, more than ever, investors need your focus your attention to detail & the team to deliver a long waited promise. Consider this your 9th inning, your Super Bowl, your SpaceX rock star moment… and PRESS ON. The world is definitely watching your progress week by week, whether it be through counting VINs, NHTSA registration, or taking pictures of Model 3s in the wild… all of us loyal shareholders are with you & the team, we are just as beaten up, tired, our eyes are blacked and the bears have definitely bitten us in the rear end (manufacturing hell is also shareholder hell). I hope you understand the gravity and magnitude of this moment in TESLA history, if you fail, it isn’t just Elon that is going down with the ship, it’s also going to be my bank account & that of many more….an entire army of believers ranging from students/teachers, nurses/doctors along with the clerk working at the local grocery store on minimum wage who pulled together $350 bucks to buy ONE single share of your company as a gesture of goodwill and & hope that your mission can better humanity, will also be disheartened. Not that you need more pressure but we need this ramp to happen ASAP so that we can go back to licking our wounds and recover.

Lately, although some very misconstrued information has found its way to hurting TSLA, however, much of that is a result of your own doing, Elon. I am not here to criticize you, your innate hopefulness is the exact thing we need to reach the stars, but as a shareholder, I am pleading that you dial back your projections on “Tesla-Time” a bit during Model Y & Semi rollout. It’s great that you have such high standards and high hopes, this has led you to enjoy much success in business; and I am a benefactor of your achievements… However, the hard truth is that many devoted TSLA investors have incorrectly mistimed their fortunes in your estimates of this ramp—the market reaction is a testament to this. Not all of us are as informed and will make mistakes… So please provide us with better quality estimates in your quarterly reports so that many of us “unnecessary causalities,” can continue to ride with you into battle. If you are reading this Elon, until we get to 5,000/ week, we need you 100% at Tesla not 50/50, besides we pay you more at TESLA anyway. Congrats on your pay package, now kick some butt and make revenge.

Yours truly,

A minor Tesla shareholder.

 

[dhrivnak]

I purchase my Model 3 Monday and I impressed enough with it that I added more shares today. The car will be a hit and I have little doubt Tesla will find a way to make it in volume.

 

[Zhelko Dimic]

I think the point really is that Tesla has fallen very very short on positive sentiment currently. Almost any news at this point is filtered negatively towards Tesla. Popular Mechanics proclaiming Model 3 car of the year would typically command a substantial climb in share price, but that requires some positive sentiment to be present. Such a positive headline amplifies positive sentiment. At this point, since positive sentiment is so off the charts low, there is almost nothing positive to amplify. Consequently, the stock may not even move on that news. Buyers are understandably cautious with this current overly negative sentiment.

It looks like after hours, the stock moved further down on news of an additional government agency joining the investigation of the fatal Model X accident recently. Is that big negative news? Not really, but with the massively negative sentiment, such news is received as a catalyst for amplifying the negative sentiment further, dropping the share price, while positive news like the car of the year news will have little effect now. That's all that I see going on at this point. This dip has gotten to the point where it really is that simple. The market is dominated by herd-mentality. At some point in the not too distant future, there will be more positive sentiment than there is now, and the stock will climb. Shorts will start to cover, buyers will return, more shorts will cover, and the fear that longs are facing now will shift back to the shorts. They will wonder why the stock is climbing so much when nothing has changed from when they were making so much money as TSLA crashed through support after support on this dip. The billion dollar question is when.

I think you're onto something here.
Sentiment is so poor. This may be a great opportunity for Elon to reset the whole dynamic when reporting numbers. Do not try to create happy narrative, present things as they are, somber, even make them worse than they are. No promises, don't offer hope. SP is low enough that it won't be affected for that reason alone, And this would be a great set up for overdelivering, rather than working from position of catching up to the promise and trust deficit.
But he won't do it. I think ego won't let him. Nothing can be done there, he is who he is, and that ego is probably huge part of his success. Reasonable people don't start car and rocket companies...

 

[generalenthu]

Here's what I'm looking forward to in Q2:

Tesla is going to announce the dual motor performance version very soon.

Saw a Performance Dual Motor Model 3 today at the track!

I suppose the performance version will start at 65 without EAD and AP. Current 49k base + 7k for dual motor & air suspension + 9k for ludicrous. ASP will be 65k+ in q2 as P3DL will be prioritized.

There are enough people who want this config that Tesla can solely build this version for most of q2. But I suppose, they'll do solely dual motor with a roughly half of them being P3DL.

This should shut up the people saying Tesla needs a capital raise in Q2. Once the machine is humming (5k+), the premium LR single motor, premium SR 3, non PUP Dual motor, and finally the base model (when Tesla hits 10k per week) start shipping.

This is a playbook Tesla followed right from the beginning with signature model S, and I am certain will take this out of it's back pocket in short order.

If you've put down a deposit for 35k model 3, you'll unfortunately have to wait. There are bigger things at stake here, like burning the shorts at the stake.

 

[ls7corvete]

I suppose the performance version will start at 65 without EAD and AP. Current 49k base + 7k for dual motor & air suspension + 9k for ludicrous. ASP will be 65k+ in q2 as P3DL will be prioritized.

Basically they announce that the 35k model will never hit the gross margin numbers they predicted, but the PDL, etc models will more than make up for it? Love it.

 

[JRP3]

besides we pay you more at TESLA anyway.

Not yet. So far he's declined his required minimum salary.

 

[generalenthu]

Basically they announce that the 35k model will never hit the gross margin numbers they predicted, but the PDL, etc models will more than make up for it? Love it.

It will be profitable in volume at 10k. Meanwhile, there are bills to pay and other things like making a sustained profit and like getting into the s&p500.

 

[sunhelm]

A Letter to Elon & the Team, from a minor investor.

Dear Elon & the Tesla team,

Usually on market down days like today I would clear my mind at the driving range, but my health isn’t what it used to be so I’m here thinking of you & the team. Bear in mind that the term “team” will also include Tesla shareholders as well as the 30,000 plus employees (ranging from management, manufacturing, mechanics, engineers, sales, customer service, etc.). The purpose of this letter isn’t meant to kick you when you’re down, it is meant instead, to lift your spirits as I have a feeling your morale could make good use of it during manufacturing hell.

Over the past 4-5 trading days the market may have over reacted to your possible miss guidance for Model 3 production of 2,500/ week vs. current rough estimates of 1,200 - 2,000/ week. While I know that you will eventually get it right and hit the ball out of the park, there are a plethora of people & institutions who desire nothing more than for you to fail. As if Tesla’s market cap alone isn’t enough to attract resentment, you are working in an arena looking to turn very established industries upside down. Hence, every miss-step will be magnified and scrutinized by bearishness in order to dissuade your heart from your mission. This is NOT the time to walk around NUMMI with your heads down; now, more than ever, investors need your focus your attention to detail & the team to deliver a long waited promise. Consider this your 9th inning, your Super Bowl, your SpaceX rock star moment… and PRESS ON. The world is definitely watching your progress week by week, whether it be through counting VINs, NHTSA registration, or taking pictures of Model 3s in the wild… all of us loyal shareholders are with you & the team, we are just as beaten up, tired, our eyes are blacked and the bears have definitely bitten us in the rear end (manufacturing hell is also shareholder hell). I hope you understand the gravity and magnitude of this moment in TESLA history, if you fail, it isn’t just Elon that is going down with the ship, it’s also going to be my bank account & that of many more….an entire army of believers ranging from students/teachers, nurses/doctors along with the clerk working at the local grocery store on minimum wage who pulled together $350 bucks to buy ONE single share of your company as a gesture of goodwill and & hope that your mission can better humanity, will also be disheartened. Not that you need more pressure but we need this ramp to happen ASAP so that we can go back to licking our wounds and recover.

Lately, although some very misconstrued information has found its way to hurting TSLA, however, much of that is a result of your own doing, Elon. I am not here to criticize you, your innate hopefulness is the exact thing we need to reach the stars, but as a shareholder, I am pleading that you dial back your projections on “Tesla-Time” a bit during Model Y & Semi rollout. It’s great that you have such high standards and high hopes, this has led you to enjoy much success in business; and I am a benefactor of your achievements… However, the hard truth is that many devoted TSLA investors have incorrectly mistimed their fortunes in your estimates of this ramp—the market reaction is a testament to this. Not all of us are as informed and will make mistakes… So please provide us with better quality estimates in your quarterly reports so that many of us “unnecessary causalities,” can continue to ride with you into battle. If you are reading this Elon, until we get to 5,000/ week, we need you 100% at Tesla not 50/50, besides we pay you more at TESLA anyway. Congrats on your pay package, now kick some butt and make revenge.

Yours truly,

A minor Tesla shareholder.

Love this. You should tweet to Elon.
- also a crying shareholder

 

[SteveG3]

Except tsla insiders people on this forum collectively has the best understanding of the financial condition of tsla. It would be nice if we can collectively create and maintain a financial model, so we can counter misunderstanding or malicious FUD about tsla financial health with an easy-to-understand model.

1. Provide more details to what’s in quarterly report. E.g. break down of equipment purchase for M3 vs. GF expansion, cost of charging network expansion vs. service center expansion, etc. These break downs are not reported in quarterly report, but I believe we collective can figure out ball park numbers.
   
2. Keep all quarterly data in one spreadsheet so it is easier to look at trends, etc.
   
3. Provide good annotation so non-accountant can understand line items better
   
4. Focus on past data and leave out the future projections. Individual people can model future project based on his/her own assumptions using the data.

I've thought about a collective model. could be done... but a little tricky.

You have me thinking though... what if we created a weekly video that had a section talking about events of the week (in week's like this, basically countering FUD), and then a section on a deeper dive topic to educate or clear up larger misconceptions.

DaveT has hosted some very helpful google hangouts... maybe Dave or someone else would be up for doing something like this as a weekly panel show on a YouTube channel. There surely is a vacuum for rational, well researched discussion of Tesla and TSLA. Among other benefits, the experience of seeing a panel of people speaking outside the bizarro world parameters of media miscoverage of Tesla would counter the much worked for misperception that various bear thesis are just common sense/knowledge (i.e. Tesla is overpriced, flood of competition is coming...).

If it's okay with the people at TMC (a considerable if), using the TMC name could help more people realize the resource that is here (blows away any other individual information resource I know of by a mile in my view). Of course, that could lead to an invasion of FUDsters here, hmm...

 

[EnzoXYZ]

There is only one reason the SP took a nosedive and it’s due to lack of confidence that the ramp is anywhere near the guidance. All other FUD is noise. Had there been good evidence of sustain 2500+/week production numbers right now no crash or Uber fatality news would drop the share price under 350. Period. Think about that and you will also conclude it’s what driving the price down.

Had a ton of trading share set to sell that didn’t fill over 360 and 380. Was really hoping for a nice price surge before end of Q1. Only 345 sold. With past pattern the likelihood of a price drop after quarterly numbers was high. Now that we are over $100 lower I do not think the chance of a drop after Q1 production announcement will pan out. Higher likely of a price increase at $250s.

Bought 75 shares at 270s and another 75 shares at 250s. Still have enough cash for 100 shares at 230. After that I’m out of cash unless I sell other minor holdings of FANG stocks. No leverage ability in the account.

BTW my prediction of 300-400 +/- 20 the first half of 2018 was way off on the low end.

 

[nesgoomba]

Welcome another player to the market, Einride, coming this Fall.

Einride’s autonomous trucks will be Nvidia-powered, and deliveries start this fall

By 2020-2025, this industry will be so highly competitive that no one will stand out as the true superpower of EV. Every companies are hungry for a piece of this market. For stock-wise, every players involved in EV and self driving, will see their market caps go up. There won't be a true leader.

 

[X Yes?]

Why would a single vehicle crash cause a huge tumble in stock price, especially when said vehicles have a great safety rating?

Answer: Manipulators taking advantage of FUD. There’s not much logic to this drop. TSLA is WAY oversold right now.

Really Guys? We don't even know if auto pilot was on. It's Moody's downgrade and the expectation that Tesla will once again fall short on M3 production. It's the fear that even if 5K/WK is reached it will be unprofitable. It's the current stock price, which makes capital raises very difficult and expensive.

 

[EinSV]

Two general comments:

(1) The median human feels anxiety from fear of loss at 2x the intensity of happiness from gain. At the retail level, this is why there are so many "doom and gloom" posts among shareholders. It may explain the high volume of trading, although much of this is, I suspect, done by algobots programmed to act on technicals. Who will do the best in this environment? Silicon and Psychopaths.

<snip> The winners will be Silicon and Psychopaths.

Let me suggest a third possibility: rational people. Since the average human (irrationally) fears loss at 2x the intensity of happiness from gain, that creates an opportunity for investors who look at opportunities (and risks) calmly and objectively when the market is acting out of fear.

I think some famous investor said we should "be fearful when others are greedy and greedy when others are fearful" is catchy and memorable. But it is not really being greedy to invest when others are fearful, it's just being rational. As long as you are betting money you can afford to lose; otherwise, fear of loss is rational too.

 

[SteveG3]

Welcome another player to the market, Einride, coming this Fall.

Einride’s autonomous trucks will be Nvidia-powered, and deliveries start this fall

By 2020-2025, this industry will be so highly competitive that no one will stand out as the true superpower of EV. Every companies are hungry for a piece of this market. For stock-wise, every players involved in EV and self driving, will see their market caps go up. There won't be a true leader.

Sounds like you feel strongly about this.

Given your assessment that there wont be a true leader (let alone a massively dominant leader with over 50% market share), what year do you think Tesla will fall below 50% of global market share of long range EVs (200+ miles of range), excluding ones built by Chinese manufacturers for Chinese consumers?

A straight forward answer, i.e., naming a year that you think this will happen, would be appreciated.

 

[elasalle]

Welcome another player to the market, Einride, coming this Fall.

Einride’s autonomous trucks will be Nvidia-powered, and deliveries start this fall

By 2020-2025, this industry will be so highly competitive that no one will stand out as the true superpower of EV. Every companies are hungry for a piece of this market. For stock-wise, every players involved in EV and self driving, will see their market caps go up. There won't be a true leader.

Does Nvidia make batteries - NO
Did Nvidia suspend autonomous driving - YES

 

[bdy0627]

220-250 is a good buying range. Buy option is the best choice here. Remember this, it is only going to be a temporary bounce (aka dead cat bounce). Once it bounce up for a few days, you sell it for a quick hefty profit. Use the profit to treat yourself a big nice dinner.

That actually could be true. The real bounce, the one that decimates the late shorts, would be the one right behind the dead cat bounce. If you're short, congratulations. Just don't forget about that one.

 

[bdy0627]

It is because people like you keep listening to the PRO side of Tesla and ignore the CON side. You should balance the PRO and CON, as if it is ying and yang.

We are not living in a Utopia world where everything is positive and flawless. This world has flaws.

Huh?

 

[postpast]

Are we all going to apologize to all of the people who said that this type of correction was possible? We can talk about the potential of Tesla until the cows come home, but lots of people on this thread have been "disliked" because they were not super positive. A month ago, saying that a price of 300 would be reasonable could lead to multiple downvotes.

 

[bdy0627]

Welcome another player to the market, Einride, coming this Fall.

Einride’s autonomous trucks will be Nvidia-powered, and deliveries start this fall

By 2020-2025, this industry will be so highly competitive that no one will stand out as the true superpower of EV. Every companies are hungry for a piece of this market. For stock-wise, every players involved in EV and self driving, will see their market caps go up. There won't be a true leader.

I've only been around here for 3 years and if I had a dollar for every time I heard this....

 

[bdy0627]

Let me suggest a third possibility: rational people. Since the average human (irrationally) fears loss at 2x the intensity of happiness from gain, that creates an opportunity for investors who look at opportunities (and risks) calmly and objectively when the market is acting out of fear.

I think some famous investor said we should "be fearful when others are greedy and greedy when others are fearful" is catchy and memorable. But it is not really being greedy to invest when others are fearful, it's just being rational. As long as you are betting money you can afford to lose; otherwise, fear of loss is rational too.

The really strange part is that I feel pretty calm being greedy when others are being fearful right now. It seems obvious to me at this point, yet there are only a handful of people (mostly here!) who get it.