Short-Term TSLA Price Movements - 2013

[uselesslogin]

Well I think things are well handled in the long run but man I can't believe the way the media is reporting it today. Bloomberg confirmed for me that the NHTSA "announcement" was through a posting on their website:
http://www-odi.nhtsa.dot.gov/owners/SearchResults?searchType=ID&targetCategory=I&searchCriteria.nhtsa_ids=PE13037


USA Today reports that Musk is "asking federal safety regulators to conduct a full investigation as soon as possible into the fires." The article goes on to say that Musk gave no hint that NHTSA was about to open an investigation. So, how is Elon not hinting an investigation will be opened? As if he would ask NHTSA and then they would decide not to open it? If you look at the website post, or "announcement" as the media is calling it the date is Nov. 15th. Obviously NHTSA is working with Tesla as they didn't post it until today after the firmware update and blog post. Now whether they are allowing Tesla to save face or not we will never know but there is no evidence that Tesla is not the one requesting this.

 

[GenIIIBuyer]

Warranty for fires means that I want to buy a TSLA again, since I am not concerned about outrageous insurance rates.

Since having lowest operating costs is big help towards fast EV adoption. I wonder whether Tesla will disrupt the Insurance market eventually. Why not cut out the Insurance middleman for car damages, and only have traditional Insurance companies for hospital and liability coverage with traditional insurance providers. Of course since the S is so safe, hospital should cost almost $0, and liability is all that's needed. If one is confident in their driving abilities, liability coverage can be pretty low.

 

[Raffy.Roma]

Since having lowest operating costs is big help towards fast EV adoption. I wonder whether Tesla will disrupt the Insurance market eventually.

You got the main point IMO. IN Italy for instance the operating costs are cheaper for all the operating costs in the case of EVs apart from the insurance for what we call "fire and theft". Now in the case of the Model S, since the fire insurance is covered from Tesla, also this operating cost should lower.
Main problem is that in Italy the Insurances are very rigid and I guess it will be difficult to get a discount anyway.

 

[marvinat0rz]

Buying common stock at the height of the panic in the pre-market today would have earned you a >9% gain by now. The volatility is just insane.

 

[GenIIIBuyer]

You got the main point IMO. IN Italy for instance the operating costs are cheaper for all the operating costs in the case of EVs apart from the insurance for what we call "fire and theft". Now in the case of the Model S, since the fire insurance is covered from Tesla, also this operating cost should lower.
Main problem is that in Italy the Insurances are very rigid and I guess it will be difficult to get a discount anyway.

Tesla is not afraid of vertical integration. With almost all repairs being done by Tesla service centers, wouldn't be hard to change the billing system.

 

[RationalOptimist]

Yup... thank you, pre-market! We may not see $117 again for a while, if ever. Was happy to pick some up. The warranty tweak is a big deal. My only real concern post the fires is that some potential buyers would worry about the loss of their investment in a new model S. The tweak takes away that worry. A few indications of demand in Europe or China in next few weeks, and we'll be rising fast again, I think.

 

[SteveG3]

Clearly, there are people who've gone beyond the headlines to Musk's blog.

If there are positive analyst notes, that will be another leg of response to recent sentiment. The only way I've seen analyst comments spun negatively is by calling John Lavello over at Merrill Lynch for some criticism to try to make it seem like analyst opinion is split.

Not, saying sentiment's turned around, but it's not strictly a feeding frenzy of negativity now.

 

[farzyness]

Tried to mirror some of the very helpful downtrend channels that were posted earlier along with some upward parallel channels. Looks like if we end above $133 today (which would be awesome but probably unlikely), and we keep above $130 for the rest of the week, downward trend could finally be broken. As for myself, I got back in with a small position @122.23.

 

[Causalien]

Guys, this is the sentiment shift event.
50% fib retracement according to $197 and $34 was almost touched.
Then a positive print on a negative headline will finish the job. Hope everyone bought straddles.

On an unrelated note. Did anyone else notice the inverse correlation with bitcoin? They almost tracked -100%. So weird.

I would like to somehow see this paired trade gone by opening a way of buying TSLA with bitcoin.

 

[Mario Kadastik]

I don't think there is a real correlation. BTC is going through a bubble right now again and is shooting up high, it hit $900 last night and dropped to $500 today and is now shooting up again being around $700. The two seem not correlated But I sure hope it's a sentiment reversal for TSLA.

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I don't think there is a real correlation. BTC is going through a bubble right now again and is shooting up high, it hit $900 last night and dropped to $500 today and is now shooting up again being around $700. The two seem not correlated But I sure hope it's a sentiment reversal for TSLA.

 

[Tasmanian Devil]

Bought some more at 94€ (around 127 $) just now. Nothing has changed with the fundamentals, the good news. Now Musks offensive. And this stock is absolutely undervalued for what is in it. A clear buy.

 

[Causalien]

There was a similar event at the beginning where battery life was holding ppl back. People were afraid of bricking from 3 stories about bricked roadster and the media had a field day trashing tesla. (Funny how it is always 3). That was how battery warranty started. This event is playing out exactly the same way. Warranty means the puck stops here let the financial numbers talk.

Though the stock price gyration wasn't as big.

 

[farzyness]

One huge thing that I think is being slightly overlooked from Elon's recent post: The fact that there is a full warranty in case of a battery fire. This, couple with Tesla's "revolutionary" announcement re: servicing that they alluded to in their investor letter for Q3 has potential to make this LUXURY car a 100% worry free, very affordable venture (more than it already was).

Am I crazy thinking this?

 

[Mario Kadastik]

I especially loved the idea of Tesla getting involved in the insurance business. They know the car best, they can operate it at marginal profit bringing the insurance cost down and at the same time provide insurance no matter where in the world you are allowing far more adoption of the car in regions outside of the core market. And if Teslas are totaled less than they estimate for in the insurance, then they keep to pocket another line of revenue. This would be a huge deal with very little risk to Tesla and a LOT of added value if they can provide insurance rates that are substantially lower than other insurances offer for other cars. It lowers the TCO of the car even further making it accessible even to a wider public and would add yet another revolutionary component to the already thrown out dealer model. I can't for the life of me figure out why I didn't come to this before today when people started to talk about it here. An announcement like this would send the stock up for sure.

 

[daxz]

Guys, this is the sentiment shift event.
50% fib retracement according to $197 and $34 was almost touched.
...

I also noticed the nearly 50% retracement in the Fib series.
A previous head and shoulder pattern was also met (see below on pattern's source).
So I believe we are at a good turnaround point.

I'm also an 5+ year member of the The Kirk Report who's been highlighting TSLA quite often this year. He placed it on his Prospector list 4/16-6/24 and then again 7/29-10/7. He also highlighted it a couple of times in his "Chart of Day" on 10/30 about a possible Bearish Head and Shoulder pattern and then yesterday that TSLA had hit his pull back target. His comment on 10/30 on H&S pattern was:

If the bears are going to crack this momentum fave, we will need
to not only see the neckline broken but sustained follow through
below the 100 day moving average which has served as strong
trailing support earlier this year

Like normal, I should have heeded his observations more closely.

Here's my version of his recent notable action on the TSLA chart with his placement of Head and shoulder targets with my Fibonacci estimation included. ~$134 is going to be the next hard level to push up through.

 

[Gtoffo]

"NHTSA's decision to open any formal investigation is an independent process. In regards to Tesla, the agency notified the automaker of its plans to open a formal investigation and requested their cooperation, which is standard agency practice for all investigations. The automaker agreed to do so."


Hmm.....

 

[Mario Kadastik]

"NHTSA's decision to open any formal investigation is an independent process. In regards to Tesla, the agency notified the automaker of its plans to open a formal investigation and requested their cooperation, which is standard agency practice for all investigations. The automaker agreed to do so."


Hmm.....

Elon Musk ‏@elonmusk8m
On Friday last week, Tesla VP of Regulatory Affairs, Jim Chen, invited NHTSA senior staff to conduct a review of Model S

btw Elon's on a roll in Twitter. Every few minutes we get a new tweet

 

[ckessel]

Nice to finally see some positive news. Well, not even so much positive as Elon mostly reiterates his previous stance and there will be a NHTSA investigation (or at least Tesla says they want one), but it shines some light and makes it easier to believe there aren't more monsters hidden in the shadows.

I'm actually rooting for TSLA to be relatively flat for about 3 weeks. I dumped all my LEAPS around $145 or so and need to wait until 12/8 to buy back in without taking some massive tax hits due to the wash sale rules.

 

[Gtoffo]

Elon Musk ‏@elonmusk8m
On Friday last week, Tesla VP of Regulatory Affairs, Jim Chen, invited NHTSA senior staff to conduct a review of Model S

btw Elon's on a roll in Twitter. Every few minutes we get a new tweet

Oh man......I'm so glad that is the case......

Once again though.....could be another PR disaster. The last thing we need is for Tesla to start quarreling with the NHTSA.....................the agency probably received some backlash and wrote that statement to sound "independent" and "proactive" regarding the case. Bad communication between Tesla and NHTSA I'm afraid.

 

[Mario Kadastik]

Trefis just raised their PT for TSLA from $84 to $113:

We recently made updates to our forecasts for the companies summarized below.

• Tesla Motors
  • $113 price estimate, +34% change from $84.04 price estimate earlier

Just downloaded their research report to see what they are basing the value on.

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Ok, they are pretty conservative with the growth numbers. Here's an excerpt:

"We have measured thesize of the EV market as a percentage of the total passenger car market,which is expected to grow from the current level of around 64 million toalmost 100 million by the end of our forecast period. We estimate the EVmarket (includes HEVs, PHEVs and BEVs) currently makes up around 2.0%of the total passenger car market, and expect it to reach 6% by the end of ourforecast period, with a far higher adoption rate from 2020 onwards. If the rateof adoption of the vehicles is lower, with EVs making up just 5% of the totalcar market by the end of our forecast period, there would be a 20% downsideto our price estimate. On the other hand, if circumstances favor a higher rateof adoption, of say almost 10% by the end of our forecast period, there wouldbe a 50% upside to our price estimate. "





Also, they only assume very slow Gen-III growth:

"We believe that the company will sell around 10000-15000 units in 2016and ramp up to 200,000 units by the end of our forecast period (2024). Thisequates to a market share (of the EV market) of around 0.5% in 2016 and3.6% in 2019. We believe that market share will reach its peak of 4.3% in2020, and gradually decrease to around 3% in 2024"

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A simple more realistic view gives a price target of their DCF model of $389 for me Oh well.