Short-Term TSLA Price Movements - 2015

[Krugerrand]

I don't get your strategy at all Matias. If you were going to bet against Tesla, its seems the most likely and best opportunity would be between now and the release of Model X since nothing substantial appears to be on the horizon except for Q1 and perhaps Q2 ERs. The news may start flying in about the Model X before Q2 ER, so that's why I say 'perhaps'. Q1 has already been given conservative guidance, so there's risk Tesla will beat it - keep that in mind. There's also increased spending on the horizon that's been foretold that many analysts are nervous about or downright don't like - that goes in your favor for your bet. But what I'm saying is that you currently have a limited window with which to play your bet. I'm confident that once Model X hits the streets, you're going to want to be out of such a position. There is risk that Tesla will miss with the Model X, but I'd say given the amount of time they've spent on it, the anal retentiveness of Elon Musk, and everything else we know, that risk is minimal. There are several who believe Model X is going to be another major hit out of the ballpark - a big time winner.

After that there may be another opportunity to bet against Tesla, I'm thinking the time period after Model X has been out for about a year or so and some of the excitement has settled, while spending goes through the roof as stated by Elon Musk, and before Model 3 release. Although, I expect during this period we'll hear that the Gigafactory is ready to start producing batteries and that the home battery storage business is well underway and showing great promise. We may also hear at this stage about new battery developments. So again, I think the opportunity may be a quite small window.

You'll do what you think is best of course, but I'm not seeing your bet being a good one unless we have a major macro event that involves the whole world - entirely possible.

 

[Matias]

I don't get your strategy at all Matias. If you were going to bet against Tesla, its seems the most likely and best opportunity would be between now and the release of Model X since nothing substantial appears to be on the horizon except for Q1 and perhaps Q2 ERs. The news may start flying in about the Model X before Q2 ER, so that's why I say 'perhaps'. Q1 has already been given conservative guidance, so there's risk Tesla will beat it - keep that in mind. There's also increased spending on the horizon that's been foretold that many analysts are nervous about or downright don't like - that goes in your favor for your bet. But what I'm saying is that you currently have a limited window with which to play your bet. I'm confident that once Model X hits the streets, you're going to want to be out of such a position. There is risk that Tesla will miss with the Model X, but I'd say given the amount of time they've spent on it, the anal retentiveness of Elon Musk, and everything else we know, that risk is minimal. There are several who believe Model X is going to be another major hit out of the ballpark - a big time winner.

After that there may be another opportunity to bet against Tesla, I'm thinking the time period after Model X has been out for about a year or so and some of the excitement has settled, while spending goes through the roof as stated by Elon Musk, and before Model 3 release. Although, I expect during this period we'll hear that the Gigafactory is ready to start producing batteries and that the home battery storage business is well underway and showing great promise. We may also hear at this stage about new battery developments. So again, I think the opportunity may be a quite small window.

You'll do what you think is best of course, but I'm not seeing your bet being a good one unless we have a major macro event that involves the whole world - entirely possible.

You have good points.

Regarding Model X release, we don't know, what the Street thinks about it. Release per se won't move stock, since everyone knows that the release is imminent. Many times it has happened, that anticipated product release from a company has put stock price to decline. Of course I don't claim to know what happens. I just want to point out, that stock can move up or down with X release.

 

[Drax7]

Releasing the X reduces uncertainty . Less uncertainty implies less risk , that would motivate some shorts to cover.
X reservations are huge , that translates into sales and cash flow to expand the business.

 

[Johan]

The X could disappoint but in that case Elon would be dead wrong for the first time ever. Highly unlikely. He seems to really think the X is going to be something else.

 

[anticitizen13.7]

You have good points.

Regarding Model X release, we don't know, what the Street thinks about it. Release per se won't move stock, since everyone knows that the release is imminent. Many times it has happened, that anticipated product release from a company has put stock price to decline. Of course I don't claim to know what happens. I just want to point out, that stock can move up or down with X release.

I agree that an X release on its own won't move the stock price. It all depends on just how good the X actually is as an SUV.

If the X gets great reviews and people line up for new reservations, I think that will likely propel the stock price upwards.

 

[anticitizen13.7]

The X could disappoint but in that case Elon would be dead wrong for the first time ever. Highly unlikely. He seems to really think the X is going to be something else.

My guess is that the X has the potential to completely eclipse the S in sales by 2016, at least in the U.S. market. Many people won't consider a non-SUV because they need the cargo space.

 

[jhm]

High growth rate is already baked in in tsla price. See this

Long-Term Fundamentals of Tesla Motors (TSLA) - Page 240

I think 30% ROI in high risk stock is reasonable. So one could say, that tsla's current price discounts Tesla's Apple like market cap 10 years from now. That requires perfect execution ten years in a row.

Model X, gigafactory, model 3 and home energy storage are already discounted to current price.

I don't believe, that everything goes perfectly 10 years in a row.

Newer the less, I think Tesla has great future. But stock price is too high at the moment. Or I might be wrong. Interesting subject. Anyway, I will place small bet.

I notice you are making reference to my post on Blind Faith Price Targets. I'm glad somebody has noticed that post because I think it is a pretty powerful tool. I don't have time to discuss it here/now, but I would like to continue this discussion in the longterm thread over the weekend. What's nice about this ultra simple model is that you can make a clear distinction between the company's intended growth trajectory and market sentiment relative to that trajectory. So it gives us a way to quantify just how high or low sentiment is at any time
Right now market sentiment is quite near an annual low. So if you believe the long run trajectory is plausible and that market sentiment will improve as Tesla takes concrete steps forward, then now may be a good time to accumulate. Moreover, one can do a sensitivity analysis and consider what if execution is less than stated. If at lower growth rate BFPT still lead you to the same conclusion, then you can have some confidence that your decision is robust and that "perfect execution" is not required for this to be a good investment. So I would invite you and others to post comments and questions about the BFPT approach in the longterm thread, and I will try to address them systematically as time permits.

 

[drinkerofkoolaid]

Has the focus of investors on this forum really reverted to focusing on the Model X? It's very interesting that people have forgotten everything Tesla told us about demand for the Model S, Model X, Model 3, and projects that haven't been revealed yet.

 

[aznt1217]

Has the focus of investors on this forum really reverted to focusing on the Model X? It's very interesting that people have forgotten everything Tesla told us about demand for the Model S, Model X, Model 3, and projects that haven't been revealed yet.

We're just looking for Short Term Catalysts ( an X reveal would be nice ). Doubt that will happen given Jerome's comments. At the very least they will announce something-- they are behind on this service announcement mentioned by Elon. I suspect it's because their leadership teams are travelling in Europe to D events and because they are rolling out Europe D deliveries.

It's quiet as there is no "real news" for Tesla in the cards. This year is about execution of expansion of S and the timely delivery of X. Furthermore, it's great to note that the GF seems ahead of schedule (which would make it on time if Tesla time is applied).

 

[30seconds]

Has the focus of investors on this forum really reverted to focusing on the Model X? It's very interesting that people have forgotten everything Tesla told us about demand for the Model S, Model X, Model 3, and projects that haven't been revealed yet.

I am looking at X as possible support for the "next leg up" in terms of revenue / financials. Q1 deliveries & production of the S, while important for 2015, do not seem to be a big jump from Q4 '14. To hit the S target of 50% growth vs. 14 we will probably need to see Q3 production/ deliveries as TSLA noted that Q1 + Q2 will equal around 40% of total 2015 target.

An X reveal and hopefully some estimates regarding target production rates should come sometime in late summer. This along with continued demand/ production for the S will make the continued 50% y/y growth more tangible and better set 2016 revenue targets - which maybe ~$9B (50% y/y growth - $4B 2014, $6B 2015, $9B 2016).

An X reveal in early to mid summer would really be something as there might be room for near term upside.

 

[aznt1217]

Well this should be good news for EVs... kind of

2016 Audi R8 E-Tron packs 456 hp and goes on sale this year

I mean... really... the P85D will be faster and cheaper with significantly more utility...

 

[ev-enthusiast]

Well this should be good news for EVs... kind of

2016 Audi R8 E-Tron packs 456 hp and goes on sale this year

I mean... really... the P85D will be faster and cheaper with significantly more utility...

Motor Trend asked if the Audi R8 e-tron will be available in the USA, answer: nope
The e-tron will be build only "upon customer request" and "in supreme hand-built quality.", so no big production series planned at all

 

[Johan]

Motor Trend asked if the Audi R8 e-tron will be available in the USA, answer: nope
The e-tron will be build only "upon customer request" and "in supreme hand-built quality.", so no big production series planned at all

... Because as we all know everyone dreams of a bespoke hand-built quality car. C'mon Audi... How much? $300k?

 

[sundaymorning]

Keep an eye on oil prices. The Saudis raised prices yesterday on Asia and the West, this is a sign that they are seeing an uptick in demand and not very concerned about losing its market share. Oil is up right now, along with Tesla. If Tesla could be beaten down by oil, it can also rise along with it.

 

[Johan]

Nice little rally here in the last hour. Oil related? Moving up the low stops now for all short-term calls...

 

[MartinAustin]

Nice little rally here in the last hour. Oil related? Moving up the low stops now for all short-term calls...

It's been climbing steadily for 4hrs.

I am thinking someone is buying a lot of TSLA.

 

[Ingenieur]

This will probobly get me more accusations of spreading FUD, btw those who called me FUDster on China still havnt come forward to say they were wrong.

I had the opportunity to speak to a friend working for big automotive supplier at Car Symposium in Bochum, he said Tesla was further behind on accepting delivery on components, so they revised the schedule in the summer and it seems like it will be revised down again, also consignment stock was supposed to be established in Fremont early 2015 now seems in the limbo.

Could be nothing, could be bad, definetly not good

 

[eepic]

This will probobly get me more accusations of spreading FUD, btw those who called me FUDster on China still havnt come forward to say they were wrong.

I had the opportunity to speak to a friend working for big automotive supplier at Car Symposium in Bochum, he said Tesla was further behind on accepting delivery on components, so they revised the schedule in the summer and it seems like it will be revised down again, also consignment stock was supposed to be established in Fremont early 2015 now seems in the limbo.

Could be nothing, could be bad, definetly not good

Two possible theories that could explain them:

- What part(s) are they supplying? Could it be Tesla is phasing out that particular part and therefore lowering the number they need?
- Given the JIT nature of the entire supply chain, it could be related to slowed production from the line upgrade and port slowdowns. Everything needs to be kept in lock step.

Agreed that it's at best a neutral incremental piece of anecdotal information though. At the same time, this is all *very* likely to be factored into the official TM guidance given a few weeks back.

 

[uselesslogin]

definetly not good

I'm not sure how good isn't another possibility. Perhaps this big supplier is being supplemented or replaced by another supplier. Not that nothing and bad aren't also possibilities.

 

[Ingenieur]

I obviously exclaimed any information that could to identfication of my friend, multiple components of same application area.

My understanding is that its multi year supply agreement with rising quantities, so basicly back end loaded, enabled Tesla to get lower per item prices upfront by agreeing to buy more later, so that total quantities reaches certain scale of discount.

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You don

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You cant just walk away from Multi-year agreement, but yes it may somehow be good but i cant think of how