Short-Term TSLA Price Movements - 2016

[Johan]

Tesla Motors was Upgraded to a Buy Rating at Goldman Sachs - Markets.co

$250 price target.

 

[graphix25]

Tesla up in 6.34, 3.10% pre-market, interesting..

Tesla Motors, Inc.

 

[PaulusdB]

Or, just the other way around. (Just to keep you doubting your opinions, my friends.)
GS already got the assignment and is now massaging their top clients to buy into the raise, when it happens, soon. They do that by negatively influencing current SP with all means available, that's their purpose in life after all. Shorting, FUD, whatever.
Leading up to the raise they will just as easily start influencing the SP positively. Favourable analyses, based on new details released by EM, supporting SP, short squeeze, whatever.
So they serve both parties very well; their VIP clients get to buy the raised stock at a discount (by averaging with stock bought at the currently discounted SP) and TM gets a raise at a new ATH (much like they did last time).

Not even two weeks later, step two of this expected game plan sets into motion.

 

[Johan]

Not even two weeks later, step two of this expected game plan sets into motion.

I agree with this pattern, which was very clear in 2013 with the capital raise that happened then where GS and MS were the main underwriters.

This time however we should keep in mind that Archambault only raised his price target from $245 to $250. If they are planning on a traditional capital raise dependent on stock price, and absolutely want to raise capital above last raise's price point of $242, quite a bit more massaging will be needed than this GS report.

 

[PaulusdB]

I agree with this pattern, which was very clear in 2013 with the capital raise that happened then where GS and MS were the main underwriters.

This time however we should keep in mind that Archambault only raised his price target from $245 to $250. If they are planning on a traditional capital raise dependent on stock price, and absolutely want to raise capital above last raise's price point of $242, quite a bit more massaging will be needed than this GS report.

Agree. It's a first small step, but in the right direction.

 

[Johan]

Some more "color" on the new GS report from Benzinga:

Tesla Motors, Inc. (NASDAQ:TSLA) - Goldman Sachs: 22% Upside In Tesla Over Next 6 Months

Apparently the PT is for 6 months from now, not a year.

And these are quoted to be statements in the report:

"we do not believe Tesla shares are fully capturing the company's disruptive potential."

"expectations are low in our view with many on the Sell/Buy sides expecting a cut to Tesla's 80-90k delivery target."

 

[Spidy]

Today the German government finally decided on subsidies for EVs (google translate).

Subsidies will be paid for a new car purchase (4000EUR for an EV, 3000 for a PHEV). The subsidies could be paid as soon as in a few weeks. There should be enough money to subsidise the purchase of about 400 000 vehicles. The program will end June 30th 2019.

Please do not miss a very bad detail, thank's to German car lobby:
Vehicles for more than 60000EUR do not get the new car purchase subsidies!

Personally, I call this the anti Tesla law
I have the impression that German car manufacturers want to get subsidies for their range of new PHEV that they have developed recently.
I think it is things like this that will very soon have a bad impact on the German car manufacturers. Once again they get a little help from the government to keep their eyes closed so that they do not have to see and feel the real competition from Tesla.

You mean like the S-Class and 7-Series PHEVs?

 

[Seesaw]

In my hometown the utility company is subsidising up to 70% of the batteries in a trial for a 100 homes to see if it will reduce the need for more grid capacity.. what if utilities around the world started to subsidise batteries to reduce the need of grid upgrades

 

[kenliles]

It's always interesting seeing what strategy everyone is using. I was writing covered calls, but stopped and now just have stock. No LEAPs, but if we go much below 200 I'll get back into the Jan '18 inm calls.

I use a slightly different mix on the same theme. With 2 layers of stock (trade layer, permanent hold layer). As the price moves down to oversold levels (currently)- I phase the trade layer in steps to OTM LEAPS (2) layers- currently holding J18 $300s and $400s. The lower it goes the more I move into these. As the SP moves up over the coming months I reconvert these back into trade shares, de-layering those. Under no circumstances will I hold those beyond 4-6 months from expiration- rolling out if necessary. Just another skinning of the cat...

 

[FredTMC]

Some more "color" on the new GS report from Benzinga:

Tesla Motors, Inc. (NASDAQ:TSLA) - Goldman Sachs: 22% Upside In Tesla Over Next 6 Months

Apparently the PT is for 6 months from now, not a year.

And these are quoted to be statements in the report:

"we do not believe Tesla shares are fully capturing the company's disruptive potential."

"expectations are low in our view with many on the Sell/Buy sides expecting a cut to Tesla's 80-90k delivery target."

Way to go, Patrick A. @ Goldman!

Nice to get some love at this point.

Hopefully this helps to change the negative sentiment and builds momentum in the SP. I agree with him.

 

[MitchJi]

Sachs expects Telsa to raise about $1 billion of capital. This potential raise was taken into account for the $250 price target.

Insider information?

 

[ev-enthusiast]

I use a slightly different mix on the same theme. With 2 layers of stock (trade layer, permanent hold layer). As the price moves down to oversold levels (currently)- I phase the trade layer in steps to OTM LEAPS (2) layers- currently holding J18 $300s and $400s. The lower it goes the more I move into these. As the SP moves up over the coming months I reconvert these back into trade shares, de-layering those. Under no circumstances will I hold those beyond 4-6 months from expiration- rolling out if necessary. Just another skinning of the cat...

Thank's for your post.
With what size do you start converting from shares to options and vice versa?
How big are your increments converting your positions?
And how much time do you usually plan for the increments?

 

[ev-enthusiast]

You mean like the S-Class and 7-Series PHEVs?

And BMW 330e and its sibling from Merc and the PHEV Golf from exhaust fraud VW, and so on.

 

[sub]

Not much of a SP reaction so far, if my memory is correct we have got bigger Jumps from past upgrades even in premarket. I hope it picks up after the Bell.

 

[aznt1217]

Not much of a SP reaction so far, if my memory is correct we have got bigger Jumps from past upgrades even in premarket. I hope it picks up after the Bell.

I take this as a stabilizer instead of a catalyst

 

[uselesslogin]

I feel like the GS upgrade and X deliveries picking up signal a local bottom. I could be wrong but I put some money behind that thought. It seems like X customers in the threads are happier with the quality with the more recent deliveries as well.

 

[Hogfighter]

Bob Lutz is either a shill or an idiot. Possibly both.

How some people rise to success in life amazes me.

 

[Drax7]

is lutz on the tape?

 

[kenliles]

Thank's for your post.
With what size do you start converting from shares to options and vice versa?
How big are your increments converting your positions?
And how much time do you usually plan for the increments?

Depending on the severity of the price fall against the 'reason-base' recovery expectation- I use a percentage against target, something like as follows:
With a low price target that offers huge buying op- $180-$200 in today's example. I'll convert in about 20% increments, reaching an 80% conversion at that low support (offering another conversion if it really plunges beyond that). So as an example from 'fair price' level let's say $250, we have ($250-$190)/5= 10-12 SP points per each 20% conversion. Sometimes I'll accelerate/decelerate some from that baseline given the 'drop-reason-expected recovery-evaluation' ; But that's the baseline. As the SP recovers over time to reach 'fair-value' determination span I'll convert back to stock in same layer unfolding.

The reason for the OTM calls is because they are balance against the core-non-trade stock (about 2/3 of total investment $s); so that allows a solid risk layer and since I have no intention of holding those to expiration, the leverage is warranted and pays of better than DITM on the SP recovery. That said, if I was converting Core stock or using higher % of total investment method- I would use the DITM calls as placeholder for the stock as others do here. That's another valid method imo to accomplish much of the same

edit add:
the OTM price target is selected as an expected value at expiration if TSLA performs against guidance goals ($400), then I layer one level below that ($300) to create a some buffering. This approach allows on occasion to peal off short squeeze gains if they happen- or on occasion keep the lower layer in place if the SP covers it very early- the method provides both leverage and flexibility with some risk aversion.

 

[mmd]

Bob Lutz is either a shill or an idiot. Possibly both.

How some people rise to success in life amazes me.

But you have to admit that he was right about the economies of scale with Giga factory. No wonder Tesla is now talking to Korean cell suppliers instead of completing the GF.
Bob Lutz On Tesla Motors (Video)