Hi Onepoint272. There is no question electric vehicles are simple to make, as you point out. Motor. Battery. Car. Once the majors notice electric vehicles, they will make millions of electric cars and blow Tesla out of the water. I'm sure they could develop a new platform in a month or two, since they are so simple. Then there is the demand problem. Who is even buying these things? Anyone? A few early adopters, perhaps? How is Tesla going to service these cars? They don't have a dealer network. Once people realize they've been ripped off, it will be all over. Tesla is already dead. The enviro-morons just don't realize it, yet. Are you short Tesla? The current valuation is clearly impossible for Tesla to live up to. If you need some shares to short, you can borrow mine. I have quite a bit, at this point.
... and there it is: $400.98 on high volume. This is obviously a big player buying in. This valuation won't hold but it has adjusted the trading window by quite a bit.
While mine sweepers check the GF4 site for unexploded bombs,Tesla has put together a sneak preview of full self driving for the end of year update. Apparently, this update is imminent. I remember when various media sources would present articles and colorful graphs which showed Tesla toward the back of the pack of the race to full self driving. Elon was a radical for declaring lidar unnecessary for full self driving. Tesla hasn't won the race yet but it's beginning to look like the other contenders are not in the same league. Tesla's FSD seems to be very far along with industry beating autonomy, smoothness of operation, system size, and power consumption. Installing the Waymo system on an EV would brutalize the range of the EV. There is a reason Google cut a deal on a ton of Chrysler minivans. GM's system which requires highly detailed auxiliary data with extreme local knowledge, does not seem to be evolving with the rest. They had an early lead but, precisely as Elon predicted, the need to have extreme detailed maps with local knowledge is a bit of a game ender. Even if they could find the resource to detail out most of the continental United States, those files would require updating at a pace that would bring untenable overhead. Meanwhile, Tesla's system has been demonstrated to work on snow covered roads with entirely obscured lines and signs. That's a different world to the testing zone in Arizona where Waymo is operating. I have a ton of respect for Waymo but I think the media declared victory was both premature and incorrect.
Near term events that will influence the price positively: - full self driving release will be sobering for the world to absorb. - Tesla's battery day investor event will be another club with which to beat everyone else. When Tesla shows Tesla branded manufacturing equipment producing Tesla brand batteries using material, some of which, came from a Tesla mining joint venture in Indonesia, it's going to be difficult for the media to spin that negative but, of course, they will find a way. - The 19Q4 financials are expected to be nicely positive but I don't see how they will be overwhelmingly positive, as Elon predicted. - The model Y release is imminent. We have been seeing a lot of model Y sightings in the SF Bay area for about two months. Upcoming events that will influence the price negatively: - Elon has indicated 20Q1 will be another quarter of loss. - 20Q2 is said to be a larger loss. - I suspect the semi production ramp will go slower than hoped and this will be a PR problem due to the overwhelming number of high profile companies on the order list. - I don't see a lot of activity at Lathrop. Lathrop is expected to be either a casting plant or the semi general assembly plant, or both. Meanwhile: - Tesla has more than 15,000 installed Superchargers. That's not stations but individual Supercharger pedestals. - Tesla is testing three different types of solar array on the roof of GF1. They just obtained a permit to install some solar awnings to simulate roofs at the Fremont factory. They appear to be working hard on getting their solar panel product line in shape. I hope this will be ready for summer 2020 but that would be a lot to dream for. Other: I don't think many people understand how many buildings and facilities Tesla has. There is an army of Tesla facilities working on various pieces of the Tesla puzzle. The last I looked at their asset list, the number of physical locations owned or leased was in the many dozens. I'm going to assume not all of these initiatives will bear fruit but we have seen that many of them have. Tesla doesn't need the currently huge development cadence to lead the industry. They have a massive lead already. It appears the big lead will continue to expand for some time. My biggest fear with Tesla, this is not a joke, is that Elon will fry his brain with NeuraLink. I am seriously thinking of selling off some of my Tesla stock to mitigate this risk.
Tesla's most formidable looking competitor, VW, is now producing the ID.3. That's the good news. The bad news is the cars are being produced and parked on leased ground while the software is finished. This car is very late, as every EV has been. I believe this car will be a winner and will truly give Tesla a competitive run. The ID.3 won't be available in North America. That's a shame because, from a distance, it appears to be an outstanding design. It's a car I would own. Based on what little I see, I prefer the design of the ID.3 over the Model Y. The Supercharger network is world beating so that would be more than enough to swing me toward the Tesla. For now, I will continue killing us all with my VW TDI.
Holy cow! $410.78 Meanwhile, over on StockTwits, one of the short sellers tells us he will make money selling short as long as the stock remains under $425. Whatever he is doing is far more advanced than my knowledge of how shorting works. lol!
Tesla is currently valued at about $74B. VW, the largest auto manufacturer in the world, is valued at roughly $100B. In terms of auto manufacturing, Tesla is wildly over priced. In terms of future potential, time will tell.
Tesla is pushing higher, perhaps on word of fresh Chinese financing of operations in china. It's currently flirting with $420. Tesla has said they are going to have every region finance operations in that region and they will also see those regions receive the benefits of those operations.
It's my belief we'll know when the Hibar production lines are near coming on line in significant numbers when we see GA5 begin construction at Freemont. There is no point in Tesla building another general assembly line while they are cell constrained. So far, no sign of GA5 coming online. Tesla has a permit to begin construction. I believe they pulled it in September and they have 6 months to begin construction, although I'm sure they can renew it.
Go TOM Go.. proud for you. Your intense D.D. and patience have paid off BIG TIME. On a side note, did Mr. Einhorn close his short position yet? His firm has taken a bloody beating over the years betting against TSLA.
I try to keep my posts positive, although I don't always succeed. In that regard, this will be another failure. I've spent a reasonable amount of time studying Tesla's cash flow, their retail model, and their delivery model; a few days. I wouldn't suggest it's effortless to understand but I certainly wasn't difficult. When Tesla started shipping the model 3 to Europe in 19Q1, there were many citations of deliveries being way down when the 20 day transportation and customs pipeline was delaying cash flow into the next quarter. 19Q2 deliveries were way up, even beyond the production level. This riddled many analysts. Where did these cars come from? 19Q3 was a great quarter, despite production only being up 12%. Again, this defied the comprehension of many analysts. Two things have become clear. First, either analysts are wilfully ignorant, based on nefarious motives, or they are fully incompetent. I believe there is plenty of both cases. Second, people like you and I can analyze Tesla as well as any major financial institution or media outlet. We have the tools and information to do a competent job. We should not look to other analyses as having authority over our own. In my case, I have a spreadsheet that has 7 pages, each with a lot of information both current and historical, that I use to estimate the current value of Tesla. It's a model that has increased in sophistication over time and as information has allowed. I've broken down the Tesla operation as best I can using publicly available information. It wasn't difficult but it did take a modest amount of energy and time. I've managed to be reasonably close. A few years ago, I thought people should not be allowed to be analysts if a privateer like me could entirely outperform their analysis on every level. Now, I lean more toward the thought of people not bothering to do the research but trying to look knowledgeable. Anyone who has worked in a corporate environment understands office buildings are full of this type of individual. We are as empowered as we care to be. These days, I'm less impressed by Warren Buffett's ability to analyze stock from Omaha and more impressed with his work ethic to do the research. You are better off outside of the stream of ignorance that embodies group think. The best way to succeed is to think as an individual. Merry Christmas, Optionslayer. Merry Christmas, Stockaholics.
When Tesla first announced it was getting into energy storage at the start of 2015, several analysts dismissed the endeavor outright as a bad idea with zero potential. I did some quick calculations based on the best guesses and estimates I could come up with. Those calculations included material costs for battery production, equipment costs, and facility costs. I also took some wild guesses at personnel costs but really, if you are an automotive company developing your own batteries for your cars, it's a bit arbitrary how much development cost you portion to energy storage and how much you portion to the automotive division. Resources on the production side literally number in the few dozen. These calculations clearly showed the potential of the Tesla Energy division to make a lot of money with very low input cost and almost no risk. That's when I started following Tesla closely. It was clear there was an insatiable demand for energy storage, by early 2016. I bought our initial tranche of Tesla shortly after that in mid 2016. That was before the relentless onslaught of negative press against Tesla. That original spreadsheet is now on version 71 and it has expanded a lot but the initial work is still part of the core of my analysis effort and it is still bearing fruit. That work has added four years of well funded retirement to our lives. I consider that an amazing ROI.
Morgan Stanley just bumped their price target by $100 with no change to their published fundamentals. Their bear case is still 10 bucks. The adjustment would seem to be a smaller red nose on their clown face. A random number generator would have been more accurate than Morgan Stanley has been to date. MS lack the ability to indicate their incompetence, incorrectness, and complete lack of ability to analyze Tesla. We all know it but, like a 4 year old child, they refuse to admin it. Tesla was always a gamble. It still is. It is, however, far less of a gamble than it used to be. Here is some food for thought... based on my analysis, if Tesla exited the car business tomorrow, their income would go up two orders of magnitude. Energy storage could soak up every battery cell they make and ask for more. Elon needs to send more cocaine to the Hibar team. Get new battery cell production online ASAP.
I invite those who are interested in Tesla to post. Please do not let me scare you away. I don't understand what is going on in China. - battery plant is incomplete and almost no visible work in the last 10 days - they have poured acres of concrete in the last two weeks - groundwork has started on a new phase which will involve several new acres of development (so far, it looks like it will be another, even larger, parking lot) - apparently, no sales permit at this time - a steady stream of car haulers continue to remove cars from the GF3 inventory - they must be moving these cars to staging locations - there are about 650 model 3 in the inventory that was visible on Friday - a steady stream of trucks are bringing components to the factory (the factory is clearly fully operational) Germany. It has been reported the GF4 property outside of Berlin has been purchased and all deals finalized. It has also been reported that construction will start in January. This is difficult to believe. Perhaps tree clearing will start in January. A major development like this is going to require a lot of planning and paperwork, even if Tesla comes in with a pre-packaged factory design (which I expect they have). From there, they will need a large scale contractor. Large contractors don't tend to be standing by, waiting for work. This will be interesting. Building in Shanghai with government help was a master stroke. Not only was it the right thing to do for Tesla's Asian market presence, it also sets a high bar for other governments to meet. Germany is not going to want to appear to be second best on GF4 construction. This is going to be extremely interesting. There have been reports of 750K unit per year capacity at GF4. While plausible, this spec is not corroborated. I'm expecting the same strategy Tesla has implemented everywhere. They will build a factory in pieces to get production on line ASAP and expand from there. To be honest, I don't know why anyone would employ a strategy other than this. Freemont. I've been studying Freemont satellite images like the Zapruter film. I speculate GA5 construction will reflect directly on the Tesla battery ramp. The business. Tesla could easily become a trillion dollar company, or more. I not guaranteed and arguable how likely it is but they are on a wild corporate trajectory that makes it plausible. I've read analysts talk about a trillion dollar valuation implying a lot of headroom in the current valuation. This idea is not entirely sound. To get to a trillion dollar value, Tesla is undoubtedly going to have to raise a lot of money. There is going to be a lot of new issues between now and then. How diluted Tesla will become during that time is nothing but gross speculation but Tesla has been expanding with an extreme low level of dilution, compared to any other corporate expansion I've ever seen. We will see. In the mean time, I would say a valuation in the low $400 range is reasonable but uncertainty continues to make for a wide valuation window. Tesla's 2019 year can best be summed up with: "$420. Funding secured."
Currently $413.50. Apparently, the downward pressure is caused by Jeffrey Osborne of Cowen has indicated the model 3 has reached "demand saturation". I was looking at our 2019 gains, feeling pretty good about myself, but now that I think about the idea of an analyst's negative prediction causing Tesla to lose significant value, I realize I should be doubling my money every day.
Reason number 42 why a Tesla is not compatible with my current lifestyle: We have friends who live in Phoenix which is about a 6 hour drive one way from my humble abode in the OC. We make that drive a few times a year and just got back couple of days ago. Did not see any Tesla's on I-10 stretch between the OC and Phoenix with the exception of 2 that were on the back of a car hauler. And in all fairness to Tesla, no other EVs were spotted either. Give me fossil fuel or give me death. Edited: Oh, and one more thing. There is a gigantic windmill farm near Palm Springs. At most, 5% of them were turning.
