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

[Fact Checking]

Anyone know the date of this interview with Cramer? TIA.

The thestreet.com webcast with Jim Cramer, where he described various blatantly illegal techniques a "hypothetical" market manipulating short seller would use, described in the first person, was apparently aired on December 22, 2006, Friday:

Cramer's TheStreet.com TV Recap: Games Hedge Funds Play​

 

[M3Rider]

What continually has amazed me is how even many bulls have failed to understand that if you dramatically increase production without building new lines or going on a mass hiring spree, you dramatically slash COGS.

It wasn't that dramatic though, we've been creeping from 5k/w to 7k/w for a long time now with no mind blowing jumps.

 

[Fact Checking]

Regarding todays SP moves. I've heard this called 'shaking the tree', where market makers drop the price, and hope to panic retail investors into selling, so they can buy the dip. Certainly not happening on any news, and I can certainly see the logic at taking profits now for some. Unless it goes below $310 I wont sell anything though. I suspect it will creep up over the rest of the week and this will be a blip.

Yes, the 3 waves of ~140k shares 'spikes' or 'icicles' were very similar to the ones on Thursday, when the post-ER price was walked back from $306 to $289 with an extreme effort.

The same effort failed on Friday though - but today it's back in control. I don't think they really expected the price to react this quickly and overestimated the required position size. Usually they are more careful and size the spikes accordingly.

I usually try to not anthropomorphize random price action Brownian motion too much, but the TSLA icicles/spikes are IMHO pretty characteristic.

 

[GBleck]

Which GM did everything they could to get rid of once upper management found out about it.

"In 2008, it released the Tesla Roadster, the world’s first highway-legal electric car." -some dude in Forbes

Fairly sure the EV1 was a highway-legal electric car.

 

[dha]

Feels like today was a bear trap. Wake me up when they manage to shove the stock down more than 3%

 

[Nocturnal]

I have to assume that once the "Tesla is profitable/stable" narrative starts to trickle down through the public's mind this will further exacerbate the current order backlog.

 

[TradingInvest]

Shorts are running against quite a few problems:

Every week there are 10,000 new Tesla vehicle owners. They become Tesla's sales force.
Model Y, Cyber truck, Semi, Roadster are coming.
GF3 and F4 are coming.
Million mile battery is coming.
Battery pack cost is going down.
Vehicle cost is going down.
FSD SW is getting better.
More superchargers coming, a lot more.
Tesla insurance.
Longs have learned to not leverage too much.

What longs should do is try to earn/save more cash, then add shares whenever it makes sense. The holding shorts are doomed. The day-trading shorts are only creating opportunities for long investors.

Edit: typo

 

[Alphacrux]

Regarding todays SP moves. I've heard this called 'shaking the tree', where market makers drop the price, and hope to panic retail investors into selling, so they can buy the dip. Certainly not happening on any news, and I can certainly see the logic at taking profits now for some. Unless it goes below $310 I wont sell anything though. I suspect it will creep up over the rest of the week and this will be a blip.

Thanks, MM's for letting me pick up an additional ~50 shares on the cheap!

 

[Artful Dodger]

green

 

[Nocturnal]

Shorts are running against quite a few problems:

Every week there are 10,000 new Tesla vehicle owners. They become Tesla's sales force.

Sales force AND new buyers for TSLA. So many owners I know got into TSLA after taking delivery. Granted that isn't a lot of money, but it is an upward pressure.

 

[M3Rider]

Do we get another dump here to prevent green?

 

[Hock1]

Thanks, MM's for letting me pick up an additional ~50 shares on the cheap!

2:20. Just about margin call time for the retail bag holders. IMO.

 

[StealthP3D]

It's a very long time ago. Cramer retired from his hedge fund before the turn of the century.

That's because he found it was easier and more profitable to tell other people what stock to buy.

 

[Cyrusis]

Tesla is placing focus back on their solar and energy storage business in a big way, and it showed in Q3. Here is some information to consider for Q4.

 

[Chocochip]

I'm aware that correlation does not imply causation, but it does make me feel all warm & fuzzy when Elon tweets about Solar+Powerwall price drops (for power outage affected customers) and the stock price goes up! It's like the market gets it, or something...
Twitter

 

[StealthP3D]

Unless it goes below $310 I wont sell anything though. I suspect it will creep up over the rest of the week and this will be a blip.

Wait a minute. You won't sell at $328 but you would below $310?

Okey-dokey then...I'll give you $309 for your shares. Wait! Let me sweeten the pot a little - I'll give you $302 for them!

Or you could just hold them a short while and you'll have people wanting them for $400. But I imagine by then you would insist on $375!

 

[KarenRei]

It wasn't that dramatic though, we've been creeping from 5k/w to 7k/w for a long time now with no mind blowing jumps.

If everything corresponded linearly - e.g.:

• ... No change in labour
• ... No change in energy or other overhead consumption
• ... Zero new capex
• ... 100% of throughput improvement through scrappage reduction
• ... supplier parts following the same trend

... then going from 5k to 7k would slash COGS by 29%. E.g. a Model 3 that cost $35k to make would go down to $25k

Now, of course, these are ideals for each cost measure. But in practice, we're looking at something not that distant:

• There really doesn't seem to have been a significant hiring spree. Actually some big staffing cuts; I'm not sure if they ever made up for them fully at Fremont and Giga.
• I don't see any reason to suspect significant overhead changes
• There certainly was capex, but compared to the cost to build the lines at Fremont and Giga in the first place? Pretty dang low.
• Of course the production difference wasn't 100% due to scrappage rates (particularly at Fremont), and so the fraction that is raw materials grows. But as Linette loved to repeatedly hammer over and over again in BI, "OMG, Tesla has major scrappage, especially at Giga!!!" Not realizing that she was making an argument for investing in Tesla. What do you think happens when you fix the rate of cells, bandoliers, modules, whole packs, etc that you have to scrap? They turn in to more functional hardware that you can sell, at no extra cost to you.
• Supplier parts are the only one of the above that is likely pretty far from a linear relationship. But even there, Tesla is famous - as bears repeatedly harped - for pressing for harsher and harsher supplier terms over time. They're famously relentless on this front. So whatever economies of scale suppliers have gotten over time, Tesla has likely frequently bullied its way into getting some fraction of them - under threat of not just switching suppliers, but outright insourcing.

Production rate increases with minimal increase in costs - both capital that has to be depreciated, and ongoing costs - is how you dramatically slash COGS.

 

[StealthP3D]

Shorts are running against quite a few problems:

Every week there are 10,000 new Tesla vehicle owners. They become Tesla's sales force.
Model Y, Cyber truck, Semi, Roadster are coming.
GF3 and F4 are coming.
Million mile battery is coming.
Battery pack cost is going down.
Vehicle cost is going down.
FSD SW is getting better.
More superchargers coming, a lot more.
Tesla insurance.
Longs have learned to not leverage too much.

What longs should do is try to earn/save more cash, then added shares whenever it makes sense. The holding shorts are doomed. The day-trading shorts are only creating opportunities for long investors.

On the other hand, shorts have a lot going for them:

They are cooler on a hot day.
You won't look out of place at the beach.
They cost less than long pants.

I could go on but I think you can see the shorts have a lot going for them.

 

[Intl Professor]

It's a very long time ago. Cramer retired from his hedge fund before the turn of the century.

Which century?

 

[Causalien]

Allright ppl, don't get too carried away.

Q4 will probably be positive. But the combination of ramping Model Y and 3 in Gyna + hiring as well as the chinese new year in January will mean we have some headwind in Q1 2020. It is best to structure your entry/exit so that you lighten the load a bit after they release q4 ER in Jan.

Of course, if tesla remains gaap positive in q1, then we will probably see the mother if all short squeeze.

So here you want to straddle in april 2021. Cause either way it will be epic.