Tesla, TSLA & the Investment World: the Perpetual Investors' Roundtable

[The Accountant]

Without “showing my work”, I’ll go on record with $22.3B, 28.1% Auto GM, and $1.075 non-GAAP…and will hope to be very, very, very wrong…

@The Accountant - any interest in compiling a second table for those of us only offering our end results, not the requisite P&L?

I can set up a second table for that next quarter for just TMC member estimates.

 

[AudubonB]

At 57 years old I finally got my dream car.... and it's a hatchback. Wait, what the heck happened to me?

Fiatsbeyond50, perhaps?

 

[The Accountant]

David Lee is more cautious it appears. Is he leaving something out? (It still beats the street.)

Dave appears to have the lowest Average Selling Price compared to others and also a higher operating expenses ($2B where I have $1.66B).

 

[Mengy]

I can set up a second table for that next quarter for just TMC member estimates.

That would be pretty cool honestly, I'd contribute my amateur model's predictions to that!

 

[StarFoxisDown!]

Dave appears to have the lowest Average Selling Price compared to others and also a higher operating expenses ($2B where I have $1.66B).

What makes Dave's bearishness even more off target here is that Q2 had the restructuring costs from the layoffs + the regular operating cost of those employees for pretty much the full quarter.

Q3 on the other hand, doesn't have the hit from restructuring costs and benefits from not having the operating costs of those employees that were laid off for the entirety of Q3.

Tesla cleaned house on full time employees with the layoffs........employees that are by far a larger hit to operating expenses than factory line workers.

 

[Mengy]

What makes Dave's bearishness even more off target here is that Q2 had the restructuring costs from the layoffs + the regular operating cost of those employees for pretty much the full quarter.

Q3 on the other hand, doesn't have the hit from restructuring costs and benefits from not having the operating costs of those employees that were laid off for the entirety of Q3.

Tesla cleaned house on full time employees with the layoffs........employees that are by far a larger hit to operating expenses than factory line workers.

Yep, I think Dave's EPS is way too low. My model predicts $1.18 but I don't go into as much detail as most others here do, and I know my model is more conservative than reality most of the time. Rob Mauer and the Accountant seem to agree, and if I had to wager I'd bet on their number.

 

[Snerruc]

Please Don’t go GJ on us

It’s a running joke.

 

[thx1139]

Table with current Q3 forecasts:

View attachment 864999

Arent Whisper numbers convenient for Wall Street. Commit to a lower number when they actually think higher. Lets them justify not doing much while at the same time not committing to what they think. I think Tesla will do $1.09 but I will say $1.02 so I dont come in over.

 

[wipster]

Yep, I think Dave's EPS is way too low. My model predicts $1.18 but I don't go into as much detail as most others here do, and I know my model is more conservative than reality most of the time. Rob Mauer and the Accountant seem to agree, and if I had to wager I'd bet on their number.

I'm going with 1.26... that's my best guess and I'm stickin' to it.

 

[Todd Burch]

EPS will vary significantly depending on whether Tesla choose to recognize additional FSD revenue (which is extremely high margin). But even if they don't, I expect it to comfortably beat WS expectations...as Tesla has done so many times in the past.

 

[M|S|M MYP]

EPS will vary significantly depending on whether Tesla choose to recognize additional FSD revenue (which is extremely high margin). But even if they don't, I expect it to comfortably beat WS expectations...as Tesla has done so many times in the past.

So...essentially you are saying $TSLA goes down AH after they announce earnings...got it

 

[ZachF]

"Intelligence analyst" ... that should tell us all we need to know.

His source is TMB (trust me bro) Analytics.

 

[StarFoxisDown!]

EPS will vary significantly depending on whether Tesla choose to recognize additional FSD revenue (which is extremely high margin). But even if they don't, I expect it to comfortably beat WS expectations...as Tesla has done so many times in the past.

I don't believe anyone's earnings estimates include FSD revenue recognition, even the high ones.

The odds of any meaningful FSD revenue recognition is extremely low. It needs to be available to everyone that has purchased FSD in the US before they can realistically recognize the revenue.

 

[Todd Burch]

I don't believe anyone's earnings estimates include FSD revenue recognition, even the high ones.

The odds of any meaningful FSD revenue recognition is extremely low. It needs to be available to everyone that has purchased FSD in the US before they can realistically recognize the revenue.

Rob, whose analysis I like, does not include any FSD revenue but recognizes it as a possible catalyst to the upside. Yesterday in his earnings preview he suggested it could be as high as about $2 (going off of memory here) *IF* Tesla chooses to recognize it. He doesn't think they will, and neither do I...of course, as a one-time-thing, it will be backed out by analysts anyway.

I think it's more likely that Tesla recognizes it for Q4, not Q3.

 

[Featsbeyond50]

Table with current Q3 forecasts:

View attachment 864999

Don't forget Value Analyst >$2 EPS.

 

[Cherry Wine]

Interesting mini-Twitter thread.

https://twitter.com/x/status/1582357714469941251

 

[M|S|M MYP]

Intel Slashes Valuation for Mobileye IPO With $16 Billion Offer

Mobileye Global Inc., the self-driving technology company owned by Intel Corp., is targeting a valuation of about $16 billion in a public offering, far below its previous target amid a rocky year for new listings.

www.bloomberg.com

But i thought Mobileye was the 'key' to autonomous driving?

 

[Featsbeyond50]

Value Analyst EPS $2

Beat me, darn it.

 

[SOULPEDL]

Yep, I think Dave's EPS is way too low. My model predicts $1.18 but I don't go into as much detail as most others here do, and I know my model is more conservative than reality most of the time. Rob Mauer and the Accountant seem to agree, and if I had to wager I'd bet on their number.

Anyone factoring in costs for moving equipment around for battery mfg, and the possibility of having both wet and dry processes warm for production. Like having to fund the backup plan in parallel. So excess equipment essentially. (Not to go all GJ or nothin’)
Maybe insignificant compared to the size of Tesla today.

I can’t wait for the call tomorrow. Maybe Elon will get in on the action somehow Who knows, I’m ready!

 

[Usain]

I want to comment on the R&D accounting thing. This has always been a TSLAQ argument that is based on specious reasoning.

It is true that Tesla accounts for R&D differently than other automakers who put it in automotive COGS and this, in a sense, makes Tesla's auto gross margin percentage not directly comparable to other car companies without first making some attempt to adjust for this accounting difference. It is also true that many bulls, especially amongst the masses of poorly informed retail investors, are not aware of this.

However, bears running with this point do not like to acknowledge that Tesla's R&D expenses do in fact behave more like indirect overhead expenses than COGS, because Tesla's R&D is apparently more or less invariant with respect to production volume. GoJo, of course, conveniently neglects to mention that since it doesn't fit his narrative. The ratio of Tesla's total R&D spending to auto gross profit has been declining precipitously and will continue to do so as production volume continues to explode. It's leveled out at 16% in recent quarters because Tesla's volume growth temporarily plateaued and because Tesla is ramping up a whole bunch of new R&D efforts. Tesla is doing R&D on a lot of stuff that has nothing to do with making S3XY cars. For example: Dojo, Optimus, FSD computer, Megapacks, Powerwalls, Solar Roof, Autobidder, metallurgy for die casting that has many potential long-term applications beyond car-making, Robotaxi, and secret skunkworks projects we don't know about. Since Q1 2018, Tesla's vehicle deliveries have grown by an order of magnitude while R&D expenditure has merely doubled. This is a property of fixed costs, not variable costs, and COGS is supposed to represent variable costs only or fixed costs like factory overhead that directly relate to producing goods.


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Another argument against Gordo is that the other auto companies are playing games with R&D for tax reasons. Many nations, including the US, provide for an R&D tax credit. So companies throw everything they can into the R&D bucket. They align R&D with COGS in order to make sure that most of their daily activities get a tax break.

With Tesla, their R&D really is R&D.