TSLA Market Action: 2018 Investor Roundtable

[Xorbit]

From Elon’s blog post this morning: “During the meeting, the Managing Director of the fund expressed regret that I had not moved forward previously on a going private transaction with them, and he strongly expressed his support for funding a going private transaction for Tesla at this time.”

What exactly does expressing regret mean in this context and why did Elon mention it? If you read between the lines, it could mean that the Saudis are threatening a hostile take over.

That also caught my eye. It's either the threat of a hostile takeover, or them telling him that this will be their final offer. The rest of the quote is also significant: "he strongly expressed his support for funding a going private transaction for Tesla at this time." leaves very little room for doubt. At the current price of $355, that means a very high probability of an 18% return (higher on an annualized basis if you assume the deal closes within a year) with a free option of a short squeeze above $420. I'd be surprised if some hedge funds aren't looking at this trade and smelling short blood.

 

[ZeApelido]

From Elon’s blog post this morning: “During the meeting, the Managing Director of the fund expressed regret that I had not moved forward previously on a going private transaction with them, and he strongly expressed his support for funding a going private transaction for Tesla at this time.”

What exactly does expressing regret mean in this context and why did Elon mention it? If you read between the lines, it could mean that the Saudis are threatening a hostile take over. Ie. We would prefer to work with you to buy a big stake, but if you continue to ignore us, we will regretfully have to do it the hard way.

To me, that's exactly what it meant.

 

[winfield100]

No. Actually we are seeing lots of accumulation in TSLA price action. Smart buying is just that, slow and precise buying at levels giving the sense that selling is the dominant trend and at the same time not giving too much buying pressure.

They would sell some to maintain the price contained, if necessary...

You can see some of this with the price overlap over multiple periods.

A/D line for last 6 weeks

 

[LoveTSLA]

I have been pretty sure we will be closed green today since early this morning.

 

[Wooloomooloo]

A/D line for last 6 weeks
View attachment 325397

Bingo...

Do watch the summary at Yahoo Finance, makes the same point with explanations. Some people are blind because they want to be...

Getting technical: Tesla bulls vs. bears

 

[Foghat]

A/D line for last 6 weeks
View attachment 325397

This may be considered what you would call the process of an “orderly close out” of big short positions.

Again, this doesn’t happen fast so it will take a while. If the $420 deal accelerates to investor vote, less orderly.

If delays, more orderly.

Big shorts definitely want delays, assuming some are 3x levered currently.

 

[ggr]

Hey @ggr, why is @CuriousSunbird banned?

Is it because he predicted less than $300 close, post that was deleted and I can't read, except what seems his partial statement in responses?

Just an information, I've thought in the past that your moderation was heavy handed and biased.

I don't have information to make proper judgment here, but I'm commenting out of concern that you're limiting our exposure to true variety and breadth of opinions. Maybe it wasn't you, and maybe the post really should have been deleted and member banned, but I feel compelled to raise my concern. If it wasn't you, I apologize.

Mod statement:
It is fair for you to express your opinion, but we moderators try hard not to discuss the details in public. I will just say (again) that there is One True Sin, and that is to knowingly post false information. There is also the simple fact that at times like this (I say again) it is easier to wield a temporary ban than to try to be selective, which would (and does) make it much harder for me to do the job better.

 

[SOULPEDL]

I also want rights to the TSLA Movie. And can't wait to see how it all ends...
The planet is saved!

 

[ggr]

A/D line for last 6 weeks
View attachment 325397

In case other people were unfamiliar with the meaning of this:
Accumulation/Distribution

 

[jbcarioca]

To me, that's exactly what it meant.

I don't think so. The Saudi side had wanted a private placement of shares vs open market. They did not get it. Now they say "if you're going private we want in". No threat made or implied.

 

[Cosmacelf]

I also want rights to the TSLA Movie. And can't wait to see how it all ends...
The planet is saved!

I used to think that Elon’s life would make a great movie, but jeez, now it’s going to have be a 20 part miniseries to do it justice!

 

[replicant]

That also caught my eye. It's either the treat of a hostile takeover, or them telling him that this will be their final offer. The rest of the quote is also significant: "he strongly expressed his support for funding a going private transaction for Tesla at this time." leaves very little room for doubt. At the current price of $355, that means a very high probability of an 18% return (higher on an annualized basis if you assume the deal closes within a year) with a free option of a short squeeze above $420. I'd be surprised if some hedge funds aren't looking at this trade and smelling short blood.

I'm pretty sure their main strategy is escaping us.

I have several theses in mind that could help the Saudi get TSLA for cheap.

For instance, could they be selling their 3% owning since the tweet and until the proposal is put to the vote in order to keep the stock price below 420 and, this way, secure a low purchase price by avoiding an outbidding escalation?
Elon is so interested in taking the company private that he might let a few large investors like SA get large shares of the company on the cheap (provided that he keep control over the company, of course). He might also accept to cap the stock price at 420 (i.e cap the shorts' losses!) so that the buyout go smooth and as few sellers as possible complain about the unacceptable 420 bid.

 

[Matias]

I know what it means. Wait for it...

I hope you’re right

 

[bdy0627]

This may be considered what you would call the process of an “orderly close out” of big short positions.

Again, this doesn’t happen fast so it will take a while. If the $420 deal accelerates to investor vote, less orderly.

If delays, more orderly.

Big shorts definitely want delays, assuming some are 3x levered currently.

I would think they would be very much in favor of whatever legal means they have to slow down this buyout process. I don't know what effect lawsuits have on the buyout process, but I suspect that would be a focus for big shorts if it can result in slowing the process.

 

[Krugerrand]

From Elon’s blog post this morning: “During the meeting, the Managing Director of the fund expressed regret that I had not moved forward previously on a going private transaction with them, and he strongly expressed his support for funding a going private transaction for Tesla at this time.”

What exactly does expressing regret mean in this context and why did Elon mention it? If you read between the lines, it could mean that the Saudis are threatening a hostile take over. Ie. We would prefer to work with you to buy a big stake, but if you continue to ignore us, we will regretfully have to do it the hard way.

Quite possible. Or it could mean exactly what it says. If we were part of those meetings and knew the parties involved more intimately, we’d have a better idea.

 

[McKricas]

SAUDI FUND IS SAID TO MULL RAISING ITS ABOUT 5% TESLA STAKE

 

[replicant]

Does anyone know how the new investors will bid for their private shares?
Assuming the buyout is approved at $420. All shareholders can requests to liquidate their position. How will buyers be prioritize? Can they bid above 420 to get priority, in which case the extra would be handed over to Tesla as free $ (that might raise enough $ to finance a factory, strings attached)? What's the usual process?

 

[brian45011]

$25-35 billion plus another $10 billion to pay off existing debt will not be a minority stake, but would make them the largest shareholder in Tesla.

Isn't that more like $6 to $7.5 billion--i.e. none of the non-recourse (plus the ABL may just be renegotiated depending on the structure.)?

 

[SOULPEDL]

IMO, I'm concluding that the gradual buying into ownership publicly at this lower price (without causing any significant rise) is what's guaranteeing the price will not go below pre-announcement levels - where it's at today. So if it won't go down, but it will likely go up...

Placed another order at $352.50. Seems to be just above the lingering low. Some folks have their hand directly on the throttle I suspect.

I'm on page with this guy:

Smart buying is just that, slow and precise buying at levels giving the sense that selling is the dominant trend and at the same time not giving too much buying pressure.

They would sell some to maintain the price contained, if necessary...

 

[RobStark]

I'm not doubting the 420 or that the deal will happen.
I'm also not doubting that Elon wants most private investors to stay in and that he wants to stay in charge and not change the direction of the company.. Elon is an optimist

Elon is also a hyper successful 47 year old self made multi billionaire.

He isn't a boffin away with the fairies.