TSLA Market Action: 2018 Investor Roundtable

[wipster]

Flying Tesla?

Elon Musk on Twitter

SpaceX option package for new Tesla Roadster will include ~10 small rocket thrusters arranged seamlessly around car. These rocket engines dramatically improve acceleration, top speed, braking & cornering. Maybe they will even allow a Tesla to fly …

 

[Remus]

Flying Tesla?

Elon Musk on Twitter

SpaceX option package for new Tesla Roadster will include ~10 small rocket thrusters arranged seamlessly around car. These rocket engines dramatically improve acceleration, top speed, braking & cornering. Maybe they will even allow a Tesla to fly …

great weapon against your opponents on the race track too.

 

[schonelucht]

Flying Tesla?

Elon Musk on Twitter

SpaceX option package for new Tesla Roadster will include ~10 small rocket thrusters arranged seamlessly around car. These rocket engines dramatically improve acceleration, top speed, braking & cornering. Maybe they will even allow a Tesla to fly …

Rocket engines? First Tesla hybris car?

 

[rameshbende]

I

Keep in mind that many shorts have an extremely strong conviction that Tesla is fundamentally a walking dead man financially. One or even 2 quarters probably will not alter their conviction. They will continue to believe that Tesla will fail but that it will now take longer for that outcome. By mid next year, they will be getting feverishly excited about competition soon starting to crush Tesla's demand and margins just as Tesla sets off on a massive new round of "cash burn." They will have their reasons to strongly doubt that the positive quarters will continue in the future. They will believe Tesla achieved 2 good quarters through unsustainable means.

This is just to say that I think it's very unlikely that shorts will be going away even with a couple of positive quarters. The reality is that Tesla will soon need a lot more money to fund its upcoming plans. It will spend money to increase model 3 production up to 10,000 per week, and it will need a lot of money to at least partly fund the China GF and an European GF coming soon. It will also need lots of money to further develop and produce the model Y and Semi products. The shorts with high conviction will see those moves as further massive cash burn just as the competition is finally getting ready to eat Tesla's lunch. The media is likely to further those beliefs at times as they have been doing lately.

I don't think you're wrong to think that the stock will be taking off soon and heading to new highs, but I would be prepared for the possibility of it coming back down sharply as shorts re-enter and perhaps increase their efforts at the higher stock price. High volatility is almost certain to continue for the foreseeable future.

I don't think Tesla will have only couple of quarters of profits and then profit goes down. If you run the numbers Tesla will generate 10 billion dollars of cash flow from operations next year. Enough to fund model 3 , model y. Roadster investment will be fairly low to about production of 2000 per year. Semi production will also be capped at 5k in 2020. My guess is semi and roadster production lines will be largely manual and only using existing model 3 stamping machine create parts. May be welding will be automated.
Profit could drop slightly in first 2 quarters of 2020 as production of model Y begins and depreciation kicks in but as ramp progresses it will come right back in Q3 and q4.
Bears argument in 2019 and 2020 will be competition is coming and valuation.

 

[Tslynk67]

For my own part i'm an atheist, but as Pope's go, this one is quite rational: Pope urges action on clean energy

 

[Intl Professor]

For my own part i'm an atheist, but as Pope's go, this one is quite rational: Pope urges action on clean energy

For my own part I'm a panentheist, though raised a Christian—not Catholic. You should read his Encyclical of a few years ago. I got through about a third before I started crying at its beauty, comprehensive knowledge of science, and truly humane and disruptive reinterpretation of our dominion of the Earth. We are not lords of it; our role is that of a shepherd. Hardcore TMCers get it. The Kochs don't.

 

[Tslynk67]

For my own part I'm a panentheist, though raised a Christian—not Catholic. You should read his Encyclical of a few years ago. I got through about a third before I started crying at its beauty, comprehensive knowledge of science, and truly humane and disruptive reinterpretation of our dominion of the Earth. We are not lords of it; our role is that of a shepherd. Hardcore TMCers get it. The Kochs don't.

Thanks, I'll take a look. The Vatican astronomer is also a very interesting chap: STEM-Talk Episode 2: Br. Guy Consolmagno

 

[jhm]

You make great points, here’s a different perspective:

It’s easier to knock Tesla when Model 3 isn’t at 5k a week. But once 5k and then 10k is at steady state Tesla is no longer the same kid that gets easily pushed around.

Getting to $500 now through 1st Quarter may seem like a good time to dial back on TSLA exposure, but will you realistically sell if Tesla was producing 10,000 Model 3s a week sometimes during the second quarter 2019? And then Powerwall/packs being pumped out at 25% margins....If the economy continues as it is performing right now, I’m not sure if revisit $350, unless there were some combinations of freakishly negative events culminating like the previous quarter (which could develop).

Also we don’t know the extent of the Chinese partnerships yet, if Tencent were upping their investment in Tesla in the Shanghai factory it would put bulls in a position of immense strength. Currently, there are still lots of developments that may add to the bull thesis, and I think we’re beginning to scratch the surface of why Elon thinks there’s going to be a squeeze. By the time we get all the facts and information together the conversation just might be “when do we get to $700”? then revisiting $500 might seem more reasonable. In all I agree with your assessment with the information we have NOW, but may disagree 3-6 months from now. Very interesting times ahead.

Yup, this is why the floor price genuinely goes up. You are also suggesting that short activity is more about the potential to harass the stock than it is about the correcting overvaluations. I suspect that may be true of this brood of shorts. As long as they've got FUD to push they don't care whether the stock may actually be undervalued. This would explain the scorched earth approach that never allows the stock to get truly overpriced, at least not for long.

 

[STARR X]

For my own part i'm an atheist, but as Pope's go, this one is quite rational: Pope urges action on clean energy

I’m an atheist too but my wife’s family is catholic. So basically I love the current pope for thinking the way the way he does. But my wife’s 90 year old mother is horrified with his beliefs. I made sure to send her this article yesterday pointing out I was on the right path.

 

[neroden]

I love Tesla and recently bought $30k worth of stock but I am extremely skeptical of the “short burn of the century”. I just don’t see it. They have A LOT of upcoming capital intensive projects. As long as that remains the case, shorts will always question Tesla’s financial position, and rightfully so

There is some evidence that the financial capacity of all the TSLA short-sellers in the market put together has a hard limit, perhaps set by the risk assessment desks at major investment banks and brokerages. In short, this hypothesis states that they can't go much over $12 billion short without getting margin-called or told to stop by their bosses. If this is correct, even a small rise in the stock price will force a lot of them to cut their positions.

 

[madodel]

Rocket engines? First Tesla hybris car?

Elon Musk on Twitter
@elonmusk
Replying to @LanceUlanoff
Note, gas contained would be ultra high pressure air in a SpaceX rocket COPV bottle. The air exiting the thrusters would immediately be replenished whenever vehicle pack power draw allowed operation of the air pump, which is most of the time.

 

[madodel]

Elon said on Twitter that FSD features will begin to be enabled with August update. Any ideas on how that will affect earnings?
Elon Musk on Twitter

Elon Musk‏ @elonmusk
Replying to @anandrajk @lexiheft @Tesla
That issue is better in latest Autopilot software rolling out now & fully fixed in August update as part of our long-awaited Tesla Version 9. To date, Autopilot resources have rightly focused entirely on safety. With V9, we will begin to enable full self-driving features.

5:01 AM - 10 Jun 2018

 

[EinSV]

Elon said on Twitter that FSD features will begin to be enabled with August update. Any ideas on how that will affect earnings?
5:01 AM - 10 Jun 2018

It seems like many (most?) people have been counting Tesla out of the FSD race. If this initial release is compelling it could change perceptions significantly -- it all depends on how good it is. Karpathy's work on standard EAP makes me cautiously optimistic.

Investors being able to visualize a path toward FSD could be huge given the massive size of the market. On the other hand, I expect the FUD to be turned up to "11" -- Tesla needs to get out in front of the safety story with solid data in the upcoming quarterly update, etc.

 

[Thumper]

Vertical thrusters could be used to unweight a wheel just as it is about to hit a pot hole that has been detected by radar. This could result in the smoothest riding car ever.

 

[wipster]

It seems like many (most?) people have been counting Tesla out of the FSD race. If this initial release is compelling it could change perceptions significantly -- it all depends on how good it is. Karpathy's work on standard EAP makes me cautiously optimistic.

Investors being able to visualize a path toward FSD could be huge given the massive size of the market. On the other hand, I expect the FUD to be turned up to "11" -- Tesla needs to get out in front of the safety story with solid data in the upcoming quarterly update, etc.

At least it won't have cameras watching your face all the time making sure you are an "alert" driver (ala Cadillac)... that whole concept just ennerves me.

 

[jelloslug]

At least it won't have cameras watching your face all the time making sure you are an "alert" driver (ala Cadillac)... that whole concept just ennerves me.

Except that in the Model 3, it does.

 

[gaswalla]

In regards to FSD features being enabled, this would allow TSLA to report the FSD payments as revenue finally, correct? That would help bottom line

 

[wipster]

Except that in the Model 3, it does.

I was not aware of that! Thanks for the info (I think?).

 

[2virgule5]

It seems like many (most?) people have been counting Tesla out of the FSD race. If this initial release is compelling it could change perceptions significantly -- it all depends on how good it is. Karpathy's work on standard EAP makes me cautiously optimistic.

Investors being able to visualize a path toward FSD could be huge given the massive size of the market. On the other hand, I expect the FUD to be turned up to "11" -- Tesla needs to get out in front of the safety story with solid data in the upcoming quarterly update, etc.

It may also improve finances as well - both in term of revenue recognition and providing incentives for all AP2 owners who only took EAP to upgrade to get new functionality.

 

[wipster]

Except that in the Model 3, it does.

Guess I should read more:
Tesla Model 3 is equipped with a driver-facing camera for Autopilot and Tesla Network