TSLA Market Action: 2018 Investor Roundtable

[Bartek652]

The NYT article is crazy. It makes no sense actually, given Elon's "def not forced sale" tweet.

If Elon wants to reduce the *number* of shareholders, they'll have a problem getting the thousands of hardcore shareholder (like me) to sell, unless they're legally obliged to do so. They might get mutual funds to sell because they don't *want* to own stocks of a private company, and these funds would rather get 420/share than stay with Elon (who want them out).

You will sell (if you have any shares) - surge price of 3000 USD or more will clear out many. Especially foreigners who are not sure if they can hold private Tesla.

 

[replicant]

Indeed. I'm increasingly confident that we have significant time before any news that will cause the stock to "stay high". Tesla is volatile, and will continue to be volatile for months. So I'm planning to restore some sells tomorrow that I had previously cancelled. At a higher price point, mind you, but I'm comfortable enough that we'll have plenty of volatility left to justify the old "sell on the highs, buy on the lows" pattern. At least to put 10-20% of my holdings on the line.

The more I think about the NYT article, the more I suspect that their sources are smoke-screening to help the shorts by insinuating that small shareholders should better sell their shares ASAP than wait to be kicked out.

The journalist woudldn't be naive but still run the story because it's a good, sensationalizing one that goes well with the "insane Elon" line they've been playing for months (or for clicks?).

 

[Johan]

The more I think about the NYT article, the more I suspect that their sources are smoke-screening to help the shorts by insinuating that small shareholders should better sell their shares ASAP than wait to be kicked out.

The journalist woudldn't be naive but still run the story because it's a good, sensationalizing one that goes well with the "insane Elon" line they've been playing for months (or for clicks?).

Exactly. They are being spoon fed bad info and bad analysis by people with obvious conflicts of interest. There are only a tiny number of real journalists left, and the number of them working at the NYT finance section is exactly 0.

 

[traxila]

Does anyone find some sense in this NYT/Dealbook theory (however tiny)? I can't believe they wrote that down. Either I'm really stupid (expecting Musk to honor his commitment not to kick shareholders out) or I've lost considerable trust in the NYT.

Sorry, but I don’t like to miss opportunities to rip NYT. The media sucks. And the NYT in particular is a yellow rag. I single them out because they are pompous and sanctosanct and claim to hold themselves to higher standards. Not hard to do considering the competition but they fail to do so routinely. Rant over.

 

[Bartek652]

I've started to find the "foreigners can't hold" theory funnier over time because nothing substantiates it.

My bank (largest broker in France) and my local stock market regulator both said there's no reason to believe the shares can't be converted. I've yet to get a confirmation from the SEC but the "small foreign shareholders can't hold" thing is just a rumor.

As always, please refute it (with a reliable source) if you can. But stop spreading the rumor until it's been proven to be right.

I asked Lynx Broker (it is Interactive Brokers partner in Europe) - got answer that I have to sell when stock will be delisted. That of course may be just incompetence of person answering.

 

[UnknownSoldier]

You will sell (if you have any shares) - surge price of 3000 USD or more will clear out many. Especially foreigners who are not sure if they can hold private Tesla.

At $3,000 it's more or less ~$500 billion future market value which isn't far from what Elon's compensation package triggering every bonus is. Because of future value versus money you have now, at $3,000 it's absolutely a no-brainer to sell everything, because you can have the 10 years future value now instead of 10 years from now and you can start investing it and making more from it and then in 10 years when Tesla re-IPO's you can reinvest then with the money you made now plus the gains in the interim. (Assuming you make gains in the interim, nothing in this world is guaranteed except your eventual death.)

 

[Boomer19]

I asked Lynx Broker (it is Interactive Brokers partner in Europe) - got answer that I have to sell when stock will be delisted. That of course may be just incompetence of person answering.

there may be ways to cross sector transfer your shares from europe to US, even with a fee. you won’t be forced to sell before a delist. corporate actions don’t work that way, meaning, it’s not an exchange trade per se. say a cash merger occurs, for instance, they will debit your shares and credit you the cash on effective date of cash merger. i mean it’s the same result as trading out of your shares if you happen to trade them at the same price as the merger price, but still, being told you “have to sell” is misleading at the least

 

[Mike Smith]

Saudi Arabia is planning to build a new City called Neom, 30 times the size of NYC, powered entirely by wind and solar. Sounds like they're going to need a very large number of solar roofs and commercial/residential batteries to make it happen. I wonder how they could secure (and profit from) such a supply..

 

[EVNow]

Does anyone find some sense in this NYT/Dealbook theory (however tiny)? I can't believe they wrote that down. Either I'm really stupid (expecting Musk to honor his commitment not to kick shareholders out) or I've lost considerable trust in the NYT.

Well, considering they pushed stories that launched Iraq war and got a million people killed, this can hardly be the story that will be the last straw.

In general, the problem is - the journalists talk to people they know. So, for some stories they will be highly accurate and for others not so. They also tend to represent a particular view of NewYork power brokers - both for finance & politics. Whether its by design or just group think.

 

[AudubonB]

Gives a new perspective/meaning (Literal) to the term IPO **Roadshow**

¿Initial Public Overland? ¿Incredibly Plush Overland?

 

[ggr]

Must read article:
What's driving Elon Musk? We asked the people that know him best | WIRED UK
Any short who reads this might see the light, and understand why they're toast.
(Thanks to @bonnie, Bonnie Norman on Twitter)

 

[JFW1103]

A private Tesla backed by Saudi Arabia might not be as far-fetched as you think
A private Tesla backed by Saudi Arabia might not be as far-fetched as you think

Just saw this article posted. It wasn't well proofread.

 

[MilosK]

Yeah, but he'd be keeping his word not due to the fear of face loss (Elon doesn't have that type of ego anyway), but because doing that to employees would be a kind of betrayal Elon is incapable of committing.

Look back all his business ventures of the last 20+ years: not a single betrayal, not a single forced out business partner, not a single investor screwed out of shares, not a single strategic bankruptcy, etc.

Elon is honest to a fault: there's been many cases where he's been honest to his disadvantage ...

Disagree. You should talk to Martim Eberhard. What Elon did then was v unpopular and a dick move. Split the Tesla community in two for a while. Now not saying it wasn’t best for the company, but Elon was disliked by many (inc me) at the time for a while.

 

[Sancho]

It seems that the consenus in this thread about the timeframe the de-listing will happen in is 6 months.

I’m retired now, and a bit rusty, but I was a big firm corporate lawyer, and I don’t think it should take anywhere near 6 months.

We don’t know the terms of the offer yet but if Musk’s lawyers can pull off a structure that allows all existing shareholders to stay invested, then the plan is elegantly simple: If you are a shareholder and want out, you get $420 (or more by selling to others if the stock price rises in the market).

If you want to stay invested, the only change is that there will be restrictions on sale of your stock. From the company’s perspective, the only change may be that ownership becomes more concentrated, which has control implications. It could really be that simple. Disclosures going forward could look exactly the same as now.

And I would be stunned if the lawyers hadn’t already figured this out well before Musk kicked things off with his tweets.

 

[Johan]

Ugh.

I just thought of a MonkeyWrench ex machina bizarre undesirednessmenthoodship, as follows (===>As per my MOD posts, ALL below are suppositions!<===)

1. Time to deal-completion takes 2 quarters

2. Those two quarters show nice profits

3. Therefore, the last hurdle for S&P 500 inclusion is passed

4. TSLA thus added to that gorilla of all Indices and enormous amounts of its shares need be purchased by such index funds

.....

And this at a time when the last thing the privatization path needs is for such a quickly-needed forced selling. Yuck.

Sooooooo....has anyone been deep enough into the weeds to know if an entity can forcibly excuse itself from being entered into this (or other) Index? I’ll be surprised if any Index creator ever contemplated that outcome!

Don't know if they could "decline" being added (my guess is no). But would they fill the two criteria below?

• most of its shares in the public’s hands (what does "public" mean here exactly?)

• Four straight quarters of positive as-reported earnings.

 

[ggr]

Ugh.

I just thought of a MonkeyWrench ex machina bizarre undesirednessmenthoodship, as follows (===>As per my MOD posts, ALL below are suppositions!<===)

1. Time to deal-completion takes 2 quarters

2. Those two quarters show nice profits

3. Therefore, the last hurdle for S&P 500 inclusion is passed

4. TSLA thus added to that gorilla of all Indices and enormous amounts of its shares need be purchased by such index funds

.....

And this at a time when the last thing the privatization path needs is for such a quickly-needed forced selling. Yuck.

Sooooooo....has anyone been deep enough into the weeds to know if an entity can forcibly excuse itself from being entered into this (or other) Index? I’ll be surprised if any Index creator ever contemplated that outcome!

Yet another reason why I don't think it will take anywhere near that long. But I don't know what I'm talking about either.

 

[KarenRei]

I’m retired now, and a bit rusty, but I was a big firm corporate lawyer, and I don’t think it should take anywhere near 6 months.

We don’t know the terms of the offer yet but if Musk’s lawyers can pull off a structure that allows all existing shareholders to stay invested, then the plan is elegantly simple: If you are a shareholder and want out, you get $420 (or more by selling to others if the stock price rises in the market).

If you want to stay invested, the only change is that there will be restrictions on sale of your stock. From the company’s perspective, the only change may be that ownership becomes more concentrated, which has control implications. It could really be that simple. Disclosures going forward could look exactly the same as now.

And I would be stunned if the lawyers hadn’t already figured this out well before Musk kicked things off with his tweets.

Honestly, Eberhard deserved it.

It made people mad - he was the founder and the "voice" of the company. But he really screwed up, and his screwups nearly killed the company. And trying to hide what he knew from the board... that's just not acceptable.

His COGS calculations were literally half of the actual total. The board had to commission an independent study to find this out. He had been warned by Magna that the transmission wouldn't work. That transmission debacle nearly killed the company. He got Tesla on the hook for production obligations with Lotus that there was no way it was ever going to meet, and hit with fees as a result. And on and on. And each time, the board had to find all this out on its own.

 

[MilosK]

Anyone have info on this? from news.google ... the page won’t load for the last 10 minutes while other Bloomberg pages have.

softbank-is-said-to-shun-tesla-deal-amid-focus-on-other-car-bets

 

[MilosK]

Honestly, Eberhard deserved it.

It made people mad - he was the founder and the "voice" of the company. But he really screwed up, and his screwups nearly killed the company. And trying to hide what he knew from the board... that's just not acceptable.

I think you were replying to me? Like I said, was undoubtedly best for Tesla - It was the way it was done that bothered people: office lockout etc.

 

[Johan]

Anyone have info on this? from news.google ... the page won’t load for the last 10 minutes while other Bloomberg pages have.

softbank-is-said-to-shun-tesla-deal-amid-focus-on-other-car-bets

I believe Aesop wrote the original story about 600 BC:

The Fox and the Grapes - Wikipedia