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

[Unpilot]

Now, now. He was just trying to be helpful.

I initially gave this a disagree but changed because I hate being disagreeable.

But the fact is this person likes to post is a...ahem...
.high minded way that sends a allure of authority.

When in fact they are swimming in their own pool of uncertainty...and choose to pick the points that cast doubt on Tesla. On a consistent basis.

 

[brian45011]

I disagree: I'm quite sure Daimler was debating internally whether to let Tesla fail and buy up the shattered pieces for pennies, or partner for a stock ownership stake in Tesla.

That they went with the latter was probably just dumb luck: in 2009 the automotive sector was still in free fall (a year later GM went bankrupt), it was rather brave from Daimler to invest $50m when their own business was in danger too.

Daimler laid half that off to Abu Dhabi's Water and Electricity Authority (ADWEA), one of its sovereign wealth investment vehicles.

 

[Don TLR]

OT

Yes I follow them and it would be nice to see them have use of the Supercharger network, otherwise useless for any travel.

 

[Unpilot]

OT


Yes I follow them and it would be nice to see them have use of the Supercharger network, otherwise useless for any travel.

Yep that network is a hell of a moat.

 

[Intl Professor]

The closest thing to that with Tesla is the obsession with "full self driving". I *think* it hasn't gotten out of control yet --but I hope the company remembers their mission statement, which does not have anything to do with "full self driving" and is all about eliminating fossil fuels.

At great risk because this is the first time I disagree with you publicly. IMHO self-driving is key to radically changing the idea you need to buy a car when Tesla internet becomes a reality or some substitute. That will be a radical change as ARK investment anticipates in its five year projection of TSLA price.

 

[CorneliusXX]

I disagree: I'm quite sure Daimler was debating internally whether to let Tesla fail and buy up the shattered pieces for pennies, or partner for a stock ownership stake in Tesla.

That they went with the latter was probably just dumb luck: in 2009 the automotive sector was still in free fall (a year later GM went bankrupt), it was rather brave from Daimler to invest $50m when their own business was in danger too.

I doubt $50m would have made much difference either way to Daimler.

 

[brian45011]

Gallery: 1-3 cars on display. No test drives. No Service.
Store: As above. Test drives. Service.
Service Center: Only service. No retail/gallery front probably due to state laws.

Most up-scale malls and shopping districts open seven days/week, often 10 am-9 pm M-S and noon-6 pm Sundays. In states where Tesla cannot obtain a dealer's license, it is not restricted by "blue laws" applicable to licensed dealers. Some mall locations have Superchargers and test drive vehicles in the parking garages. Without excessive overtime, it would be difficult to staff any location expected to remain open 72 hours/week with just two people, particularly considering illness and paid time off.

If Tesla proceeds with its plan to phase out beginning in April stores and other locations that currently offer test drives, there may be some good deals on floor models and test drive vehicles.

 

[Lucky_Man]

Weekend OT

Thinking of model letters for the next Tesla vehicles...

Model S > Model X > Model 3 > Model Y

S - 3 - X - Y .... A - F

Resonates somehow, doesn't it?

 

[neroden]

Same. Also, I never understood the ''wait a year" mentality. Sure, you might save a bit of money and avoid an issue or two. But in the meantime you gave up a year with the car that you're never getting back.

Yeah, this. I wouldn't wait another minute to get into an electric car.

Though if you already *have* an electric car, then hey, I guess it's not as big a deal to switch from one EV to another.

 

[Sparky]

I have certainly gotten very lucky in several important ways, financially. And in smaller ways. Stumbled into a merger trade I wasn't anticipating just a year ago.

I think it's Buffett or maybe Munger who said you can only expect to find four or five really good (i.e. seriously underpriced) investments in your lifetime, and you just have to jump on them. Stumbling onto them is luck. Taking advantage of them is skill.

Back in 1998, I second-guessed myself on eBay and missed out on its massive boom, which is a mistake I will never make again.


I think in the stock market an awful lot of skill is just paying massive amounts of *attention* -- in the case of Tesla, just knowing real information and ignoring disinformation gets you further than 95% of traders. And then most of the rest of it is knowing how not to misinterpret the information you get.

For instance, *twice* I sold companies because they were chaotic flaming messes in terms of internal management. Both times I was wrong; companies did fine. I avoided two software companies because their software was hot garbage with clearly-incompetent IT management. Also wrong; they did great.

Once I kept a company despite evidence that the management had completely wrong priorities. That was a serious error.

The closest thing to that with Tesla is the obsession with "full self driving". I *think* it hasn't gotten out of control yet --but I hope the company remembers their mission statement, which does not have anything to do with "full self driving" and is all about eliminating fossil fuels.

Thanks. I always appreciate hearing about the missed decisions more than the "wins".
The greatest lesson I've gotten from investing is to know my own biases with each buy-sell-hold decision.
Decisions require the emotional side of the brain and it's taken many years for me to understand why I'm so positive or negative on one stock vs another. I've had a blind spot towards bio-techs that have been almost 100% losers. I sold GOOG, after buying the day of the IPO, when it had doubled because I was bored with it. I have an extremely busy work life which precludes a lot of due diligence but I think have a pretty good handle on my own investing "issues" and have had decent success for the last 15-20 yrs.

I decided to help my kids down this path by doing the following:
On their 8th grade graduation, I give them a stock account with a small amount of cash ~$1200.
Their job is to invest and pay for whatever they think they might want for high-school graduation.
I enjoyed seeing how each responded.
The oldest, very analytical and thorough became too stressed about daily market fluctuations. Finally, put 3/4 in cash and the rest in Apple (a good bet in 2006).

The middle kid lost all they had gained and then some during the 2008 downturn. But, being an X-games competitor, seems to like the adrenalin and while in college, put what was left, and some new cash, into TSLA in 2012 (still has it).

The youngest didn't find investing in stock the least bit satisfying and just did index funds. Still does.

I still learn from them after they were enrolled as children in this seat-of-the-pants investing course. The oldest, trained in art and design, advised me to buy NVDA at $44 because, after using their tools and dev boards, said it was years ahead of competition.
Cheers to the longs.

 

[neroden]

I agree, but note that due to the pervasiveness of calculated Tesla disinformation flooding almost every regular investor communication channel this is very hard to do unless you have education and sector knowledge in all the fields Tesla is involved - which is basically "all of them", maybe with the exception of food production.

Hmmm. Anyone seriously concerned about pollution and global warming would pick up all the sector knowledge during their research into climate change... maybe not the financial part, though I think that too...

This is a big advantage in terms of results and costs, but it's a big disadvantage in terms of convincing regular "disinterested" investors.

FWIIW, while I fully recognize that you could be right, I'm as certain as one can be about the future that you are 100% wrong here: Tesla's FSD effort is a masterpiece, it's similar to SpaceX's reusable rocket design and the business plan it got interwoven with.

I'm not saying it will definitely fail; it could succeed eventually. I'm saying it's going to suck up a very large amount of money and effort and it's going to take a long time.

As long as they remember that making EVs and stationary batteries is first priority and don't cannibalize the EV/Powerwall capex for the purpose of doing FSD research, it's OK. If they *do* start postponeing EV or battery investments to fund FSD, that's the time to get out.

 

[mrdoubleb]

Weekend OT

Thinking of model letters for the next Tesla vehicles...

Model S > Model X > Model 3 > Model Y

S - 3 - X - Y .... A - F

Resonates somehow, doesn't it?

Actually, I think energy has never been S3XYR.

 

[SunCatcher]

I’m a sucker for punishment and guniea pig is my middle name. I’ll be refreshing my screen every second starting tomorrow until I see a reservation online form. You’re welcome.

If everyone waited for others to go first, there would be no progress, and in this case, no Tesla. Sometimes we need to vote with our dollars, to insure that something this important comes to be.
And when others buy in a year later, getting a better product for less money; the right response on our part is just to say "You're welcome".
The pure joy of having owned and driven our Model 3 this past year, instead of waiting for "better and cheaper", has been proof that we made the right choice. The pure joy of seeing Tesla grow and prosper this past year, despite all the road blocks thrown up in its path, has been irrefutable proof that we made the right choice.
Contemplating the future; even the shorts, the FUD broadcasters, the people involved in making legacy ICE automobiles, the human beings owning and running Big Oil, Coal, Gas; they all will eventually benefit from the advancements brought about by Tesla's progress and struggle. And it wouldn't have happened if someone else hadn't gone first.

 

[neroden]

What makes a hot mess group of people successful are; unwavering leadership and resolve by all to see a single goal reached.

Actually, the successful examples I mentioned (which I failed to invest in) didn't have that either.

What they had is... well... the best analogy I can think of is that they had the wind to their back. Prevailing trends were in their favor, and so they could make a ton of mistakes and still do great.

Their management problems actually did come back to bite them, it just took several extra decades. Turns out "Their corporate culture problems will totally kill them in 30 to 50 years" is not a good reason to sell now, even if it's accurate. It's longer than most reasonable investment horizons even for long-termers.

 

[Fact Checking]

I'm not saying it will definitely fail; it could succeed eventually. I'm saying it's going to suck up a very large amount of money and effort and it's going to take a long time.

I'm pretty certain Tesla will enter the "FSD generates net cash" phase later this year already. (!)

NoA and Advanced Summon are FSD features already, the rest needs HW3.

IMO the biggest technological risk was the AI chip tape-out. Worked on the first try it appears - Tesla got lucky and had the right people: both Jim Keller of AMD64 fame (he designed the AI chip - he is working at the Intel server division now) and Pete Bannon of Apple A5,A6,A7,A8,A9 fame (HW3 production) are top notch people.

 

[Krugerrand]

I disagree: I'm quite sure Daimler was debating internally whether to let Tesla fail and buy up the shattered pieces for pennies, or partner for a stock ownership stake in Tesla.

That they went with the latter was probably just dumb luck: in 2009 the automotive sector was still in free fall (a year later GM went bankrupt), it was rather brave from Daimler to invest $50m when their own business was in danger too.

And the persuasive argument Elon laid out had nothing to do with it? The same persuasive argument he obviously made to Panasonic to get them to partner kicking and screaming the whole way.

No, mon ami. Ain’t no luck involved. Hard work, passion, never give up attitude will always create that which others think is ‘lucky’.

 

[Fobble]

It's really frustrating. Currently no good news raise the stock. Any small ounce of bad news drop the stock. It's almost like TSLA is currently priced for perfection already. .

I thought it's another way around. TSLA is priced for the most imperfection. I have reservation on Tesla's strategy on closing display stores and test drive programs, but I am all for the price cuts to undercut competitions and to fuel future growth.

 

[Krugerrand]

I initially gave this a disagree but changed because I hate being disagreeable.

But the fact is this person likes to post is a...ahem...
.high minded way that sends a allure of authority.

When in fact they are swimming in their own pool of uncertainty...and choose to pick the points that cast doubt on Tesla. On a consistent basis.

I was being sarcastic and throwing back his own words that he threw at me. I know what this guy is all about and he’s not here to add anything helpful. So, yeah. What you said.

 

[brian45011]

Finished goods inventory is not included in FCF...

Changes (up or down) in any type of inventory affects Cash from Operations:

Inventory growth used $1.02 billion in 2018 according to Consolidated Statements of Cash Flows in the 10k:

" The increase in cash from certain operating activities {for 2018 compared to 2017} was partially offset by the increase in accounts receivable and inventory, as a result of increased Model 3 and energy products deliveries and production. .."​

 

[Krugerrand]

I doubt $50m would have made much difference either way to Daimler.

They also had a seat on Tesla’s board at that time or was it that the money ‘bought’ them a seat - I can’t remember which. But that seat emptied when they sold their Tesla stake.