Tesla stock selloff provides opportunity to be 'aggressive buyers': Baird Shares of Tesla Inc. TSLA, -8.00% sank 4% in premarket trade Friday, in the wake of the electric car maker's announcement of a $35,000 Model 3 price tag and retail layoffs, Baird analyst Ben Kallo sees the decline as a great buying opportunity. Kallo reiterated his outperform rating and $465 stock price target,
I can't help but notice there is a narrative coming from several posters on StockTwits that Tesla is about to become insolvent based on a maturing bond issue. One of the posters even made a post citing the current $3.6B of cash and equivalents not being enough to cover $900M of bonds. It's pretty clear there is an organized campaign to discredit Tesla. I expect that campaign to escalate until early April when the model Y is introduced. When the model Y is introduced, I expect the onslaught with a narrative about problems in China until vehicles start rolling off the assembly line. I have no idea what negative news will be fabricated after that. I'm long on Tesla but I don't expect the stock to do well before the end of this year. If it does, that would be great. I've been long on Tesla for 2.5 years but, when people post that they've shorted Tesla, I don't assume they will lose money. There will be plenty of fake news designed to lower the Tesla stock price in the next year and people continue to be influenced by it, despite 98% of it being factually inaccurate and entirely ridiculous. There are sufficient lemmings to create minor fluctuations. When Tesla does misstep, and they have and they will, it will cause wild fluctuations. Long term options don't seem like a high risk with this stock. Can you imagine if someone who didn't know and had no access to information posted that GM was 10% down on their monthly production? Anyone who has been exposed to mass production knows it happens. I doubt it would create a world sensation, though. How many Ford Mustangs have been driven like getaway cars and ended up being totaled? I would think thousands. How many have made the news? And yet, a teen drives a Tesla like a moron in Florida, wraps it up, and it's a national headline. As long as Tesla can remain focused and execute well, I will be pleased to own this company. Believe me, I have no idea what the stock will do. I just know they are a company that has gone from 70K/year vehicle production to 350K/year production in the short time I've owned them. While doing that, they've scaled to over a gigawatt of energy storage production, built the largest battery factory in the world, built out an astounding SuperCharger network, and done tons of other stuff like help bring islands like Puerto Rico into the 19th century. I'm a happy owner.
I assume the current price slump is based on Elon's tweet of no profit in 1Q19. IMO, that's a reasonable market response. Tesla is not a company for short sighted people or people who can't afford to lose money. Anyone who puts their nest egg into Tesla should be aware they are taking considerable risk. I'm a big fan and I'm aware there is no guarantee that Tesla will succeed. I also expect the price will take a significant bump on March 14 when the Model Y is revealed. People will be surprised that Tesla can make a compelling electric vehicle. Who knew? By March 15, the negative Tesla narrative will be running double time to crap on the company. Meanwhile, Tesla is on Supercharger version 3. The SuperCharger network is one of two world beating competitive advantages Tesla has which the media pretends doesn't exist. With SuperCharger V3, an 85KWh battery can be charged from flat to 80% in 17 minutes. A long range Model 3 will be able to roll into a station near empty and load up with 285 miles of fuel in 15 minutes. That is getting extremely close to an ICE refueling experience. The key difference will be the Tesla driver can refuel for a few dollars. Porsche is talking about 350KW recharging. I don't see the point. At 350KW, the same Model 3 LR could recharge in 12 minutes. That's 5 minutes faster. How much battery pack longevity are we willing to sacrifice to save that 5 minutes? That's not 5 minutes per charge. That's 5 minutes per charge while on the road. At home, it won't matter. Until we can get the internal resistance of the cells reduced, I question charging faster than 4C. Perhaps with Tesla's solid state anode production, we might get there. If we were using super capacitors, the faster the better but we are not. Nobody seems to care about Tesla seemingly eliminated the use of cobalt in their batteries. Anyone who does not understand the significance of this should not be allowed to be an analyst. I'm just a guy with a computer and an interest in EV and Tesla. I'm far from the sharpest guy on this stuff. How come I'm Stephen Hawking compared to Tesla analysts? Morgan Stanley just noticed Tesla has a supercharger network a few weeks ago. I'm not sure what's going on here but it's either nefarious or most analysts are morons.
On a 30 mile stretch of the 405 freeway from Long Beach to south Orange County today I counted no fewer than a dozen Teslas. One was the huge version that resembles a tank. They're easy to spot since they're rewarded for saving the planet by being allowed to drive in the car pool lane. They breeze by me as I sit in traffic with the doomed sinners destroying the planet in our gas burners.
I wouldn't be so quick to dismiss the advantage of using the diamond lane. Teslas are ideal for people on social assistance to drive to the dispensary. There is no need for them to spend any more time in traffic than necessary.
Traded this several times, only shorted 1 time with success. Only lost a couple times swingtrading. Not something I want to hold long-term though.
SuperCharger V3 confirmed to charge at 250KW at a Tesla event this evening. That's the number used in the above calculations. The increased charge speed will help Tesla as much as the customers because people will be in and out more quickly, increasing network capacity.
Nio cancels plans to build a factory after reporting losses. One by one, "Tesla killers" end up dying off. It's real easy to put together a power point presentation showing you are going to build a factory and manufacture 1M cars per year but it's kind of difficult to do. Tesla has made the jump to being a significant manufacturer of their own cars. It wasn't easy for Tesla. They took heavy losses and did a lot of side hustle to scale to where they are now. When I hear that a new company is going to blow away Tesla, I hear someone revealing they can't think of a better reason to crap on Tesla so they will cling to the fairytale. I'd like to see some other manufacturers succeed but I don't see how they are going to do it. Tesla has the largest battery factory in the world. They've used scale to drive their battery pack cost down to under $100/KWh. It is going to be extremely difficult to catch up to where Tesla is now and much more difficult to catch up to where Tesla is going in the future. Tesla has a line of electric vehicles with another being introduced next week. Others are struggling to bring one car to market. GM's car is not being consumed in quantity. Tesla is cannibalizing Nissan LEAF sales with the 3. Tesla is like Pacman. They are consuming the North American market. I expect the same to happen in Europe. VW talked about producing a similar car for half the price. They will be lucky to produce a lesser car for 50% higher price and manage to break even. The Chinese market is going to be a more difficult market for Tesla to dominate. There are a lot of low end cars in China that Tesla doesn't know how to compete with. I'm not sure it's even wise for Tesla to compete with them. Tesla will do well if it can stick to it's plan and keep working hard. Scale will bring success. As other manufacturers lose the EV incentives, they will fall by the wayside. Tesla is the only manufacturer with a reasonable expectation of staying in business once the incentive is gone.
Another piece of Tesla news being ignored is that Tesla has installed a bunch of automation equipment from Grohman at GF1. They have automated production lines on the energy side to produce power walls and power packs. Those are high margin products. They are poised to more than double their output this year. Suffice to say, I'm a happy Tesla owner.
There is a lot going on for them, but one constant is the volatility, which is not a bad thing if you write options on TSLA!
That's probably one of the tricks for the long holders. Elon tweets, share price moves quickly. Can't help but believe it is being used to someone's advantage.
As a Tesla long holder, I see the biggest cause of volatility is being part of an ownership group made up mostly of 3 year old children. Every time someone brings out a PowerPoint presentation and says they are going to put Tesla out of business, there are a half dozen media outlets that will broadcast that headline and Tesla stock moves wildly. Look at the Audi promise of 350KW charging. They don't have a car that can soak up that much current. The only car that might is the Taycan and that won't be in production until later this year, best case. Meanwhile, there are private YouTube videos of people charging their Teslas at 250KW that were posted last night. If I were an owner of Boeing, I wouldn't rush to sell my stock when some guy from Oshkosh, WI said he was going to build an aircraft with the same specs as Boeing at half the cost and put Boeing out of business. And yet, people believe this all the time in the EV world. I'm not saying nobody will ever challenge Tesla. Someone will. I'm just saying that I feel zero threat from any powerpoint presentation, even if it's done by Audi. I have an idea of how hard it is to do what Tesla did. Tesla just barely survived and it took a lot of planetary alignment to make it happen. Another company could also do it one day but it's a long shot. When you bet on the heavy favorite versus the pack, you know the favorite might not win but the reality is the others are all long shots.
Surely you don't put much weight into their assessment. Tesla will do what the market wants, it's a good trade for me as it has good swings but I don't give much thought to what some analyst tweets about. Elon's tweets are a different story though, made some good dough when he did the 420 takeover and did great when he took a puff on the doobie to.
Hello! Citron along with the bio-hit man calls are not to be ignored imo because both seem to carry some weight. Tend to check/monitor Citron's bullish/bearish calls to see how they play out because have been in a couple plays when they issued bearish PT that had stocks heading south & have also seen one bullish PT call hit to the penny so...
I don't know why they, Citron, are calling 320, but in the near-term I could see 320 getting hit. The downward thrust has been shortening. The last two down-waves have not been able to make it down to the demand line of the downtrend channel off the December high (the red channel) and the price has formed a trading range Tuesday's high volume selling dive under the recent trading range (279) was absorbed; closed well off the low, no follow-thru After the dive, price sprung back into the range (today, Friday), so that now it is in the spring position for a move to test the top of the range @ 324 or as near as it can get (it will be going against a strong downtrend) However in the intermediate term: Last Friday's and this Monday's fall had wide price spread (relative to other bars in the TR) and was on high volume indicating a Sign of Weakness (SOW) which is a warning as it does not bode well for this trading range as it indicates distribution and that the range may be a re-distribution TR The trend off the December high is down so demand will need to prove itself with a Sign of Strength (SOS) for price to break higher out of the TR (trend rules). Conclusion: If I was swing trading and was forced to trade against the trend, I'd cautiously go long for a holding period of a few days to a couple weeks. If demand appears, that would change the intermediate picture. Daily bars:
