Anyone else a Tesla investor?

[Time2]

Because based on today's valuations the market is looking at Tesla as the next Amazon and GM as the next Sears.

And as crazy as that sounds, it was not that long ago that Amazon was losing a lot of money and Sears was still very profitable.

Well said.

As I said, "Value is clearly in the expectations of stock purchasers"

 

[NW-Bound]

As I said, "Value is clearly in the expectations of stock purchasers"

Even Musk did not expect his company to be so highly valued by investors, back when Tesla share price was a lot lower than it is now. In response to a high stock price target by a bullish analyst, Musk tweeted "Wow".


Recently Musk exhorted his employees to keep working hard in an email.

... in an email to employees Musk acknowledged that Tesla's actual profit margin is fairly low, only about 1%, and that the stock price is due to investor expectations of future profits rather than recent results.

"If, at any point, they conclude that's not going to happen, our stock will immediately get crushed like a soufflé under a sledgehammer!" he wrote in the email, which was first reported by Electrek.

 

[Blue531]

GM is "just" a car company. Tesla is anything but. Take a look underneath the "hood" when you get a chance.

 

[triangle]

As I said, "Value is clearly in the expectations of stock purchasers"

Agree. I believe Musk is a visionary and good promoter, and has created extra excitement around the company. I think it is fantastic what he has achieved with Telsa and how they are pushing the technology forward.

However there are also smart people working for other automakers. I remain ignorant of the marginal gains or true technical leaps (including patents) that Telsa has, as otherwise electric motors and chemical battery technology are not a secret. Which is a long way to say that I do not believe Telsa has anything close to a lock on the future market. I think they are more of a momentum stock, that today's buyers are mostly traders, with a few true believers willing to hold for a decade plus.

 

[r3saving]

I think they are more of a momentum stock, that today's buyers are mostly traders, with a few true believers willing to hold for a decade plus.

Indeed, but what if you could just hold through the ups and downs? One thing I've learned along the way is that the longer you hold a company, the more you can learn about it.

I first invested in Tesla in mid 2012; they had one very expensive, though good looking, car on their website at the time and not much of a charging network. They had also published a blog post called "The Secret Tesla Motors Master Plan" dated August 2nd, 2006 that I thought was certainly interesting and prompted my investment. I bought a tiny position knowing full well that it could go to zero but I liked Musk's vision. That plan was updated in 2016 and is titled "Master Plan, Part Deux" if anyone want's to Google it.

One big difference between Tesla and the OEM's is that they can and do rapidly change. Sandy Munro has done tear downs of the Model S, Model 3 and Model Y. Interestingly, he tore down two Model Y's three months apart and in that three month period, Tesla had changed (significantly improved) the build. As Sandy likes to say, "Tesla moves at the speed of thought" and it seems to be true. Their other secret sauce is in "building the machine that builds the machine" - Google that if interested.

Another big difference between Tesla and the OEM's is that Tesla does not even want to be a "car company", that was just their starting point. They are an energy and AI company ...and yes, I know many scoff at that.

One big question is this; is Tesla causing an automotive paradigm shift? Tony Seba thinks they are. I certainly don't know for sure but clearly, OEM's are finally taking notice and moving towards creating EV's. Tesla does not need to corner the car market, that was never the point.

Anyway, I've not sold a single share and my tiny, speculative 2012 position is no longer tiny. While traders do cause a lot of volatility and I would not be surprised if there is a pull back after the S&P 500 inclusion but I also think that's just noise. I'm willing to hold and see what happens. A black Swan event would absolutely be unpleasant but would not kill my retirement. I do think Tesla has possibly moved beyond a Black Swan risk level.

We shall see...

 

[ExFlyBoy5]

I saw this morning that QuantumScape released some news that they have made a HUGE breakthrough in regards to battery technology. In part:

The Silicon Valley company said its tests with prototype single-layer cells demonstrated the ability to recharge batteries up to 80% capacity in just 15 minutes. The data suggest that the technology could produce car batteries capable of lasting hundreds of thousands of miles and weathering temperatures as low as -30 degrees Celsius (22 degrees below zero Fahrenheit).

There is a definite race in this technology and while Musk is a very smart man (and has some very smart folks working for him), I don't know that in the end they will be the "winner" so I personally don't think TSLA is a long term hold FOR ME.

If and when SpaceX goes public...now that's another animal. I would LOVE to put some $$$ to work in that program. It's one of the few companies that really excites me.

 

[oneill225]

Agree. I believe Musk is a visionary and good promoter, and has created extra excitement around the company. I think it is fantastic what he has achieved with Telsa and how they are pushing the technology forward.

However there are also smart people working for other automakers. I remain ignorant of the marginal gains or true technical leaps (including patents) that Telsa has, as otherwise electric motors and chemical battery technology are not a secret. Which is a long way to say that I do not believe Telsa has anything close to a lock on the future market. I think they are more of a momentum stock, that today's buyers are mostly traders, with a few true believers willing to hold for a decade plus.

To each his (or her) own. Everyone has their own tolerance for risk and I would advise everyone to risk only what they can afford to lose. What makes Tesla stock compelling is the, now obvious, shift to EVs from ICE vehicles and the, now obvious, fact that the legacy auto makers are not keeping up with Tesla, despite all of their smart people.

We have been down this road before. Netflix rewrote how we watch TV, Amazon rewrote how we shop, and Apple rewrote how we talk on the phone. Tesla is rewriting how we will transport ourselves and the competition is slim. At what point do you think the legacy automakers (or new automakers) will overwhelm Tesla with their "smart" people. Shouldn't it be happening by now?

Tesla is not overpriced or overhyped. Just the opposite. Ford, Toyota, GM, etal, are overpriced because they are just now attempting to climb a mountain that they thought was a hill. To avoid Tesla in favor of Ford is the equivalent of investing in Blockbuster Video back in the 90's over Netflix. It is a form of willful ignorance.

 

[FIREarly]

If and when SpaceX goes public...now that's another animal. I would LOVE to put some $$$ to work in that program. It's one of the few companies that really excites me.

Agree with you on SpaceX
To me, TSLA has great value and will remain the most well known EV for multiple years

 

[r3saving]

If and when SpaceX goes public...now that's another animal. I would LOVE to put some $$$ to work in that program. It's one of the few companies that really excites me.

Agreed but it doesn't seem likely - at least for now. Musk did say they're considering spinning off Starlink once it's more stable. That might be an interesting investment too.

 

[ExFlyBoy5]

Agreed but it doesn't seem likely - at least for now. Musk did say they're considering spinning off Starlink once it's more stable. That might be an interesting investment too.

No doubt. I would be in on that in a HEARTBEAT. I read not too long ago that Musk had no intention of going public with it. Of course, he also said that TSLA had no intention of raising more money...yet he's doing just that.

I TSLA is down a little now, I wonder if some of these young Robinhood investors are selling so they can get in on the Doordash IPO?

 

[Christine]

I TSLA is down a little now, I wonder if some of these young Robinhood investors are selling so they can get in on the Doordash IPO?

I belive the 5B stock offering from yesterday might be the cause.

 

[NW-Bound]

It's not just Tesla, but the FAANG stocks are also down today.

About Tesla, the entire EV industry is on fire, just like the Internet was in the late 90s. I just saw a headline saying investors in India are piling onto Tesla, despite it selling no cars yet in that country.

I don't have any investments in the EV market, not even in any FAANG stocks. However, I have quite a few holdings in the semiconductor industry, and they have quite reasonable P/E relative to the S&P. The shares also went up like mad, although nothing like the EV sector.

I have sold covered call options on more than $500K worth of these shares. The purpose is to lighten up my AA on this sector. Whether these calls get exercised or not, I am fine with it. If the shares get called, I will sell put options to buy them back cheaper.

 

[daschtick]

On my walk today, I was listening to a podcast and it said GM sells 7.7M vehicles (2.9M in the US) a year while Tesla sells 368k vehicles. It then went on to say that Tesla has market capitalization larger than GM. I just Googled to get numbers, 623.8B vs $62.7B, Tesla is 10 times larger!

2019 profits for GM were $8.4B,

Tesla, well, they lost $862M.
Value is clearly in the expectations of stock purchasers.

Looking in the rearview mirror with outdated info? The current and future trajectory is where the money is at.

 

[Spanky]

Looking in the rearview mirror with outdated info? The current and future trajectory is where the money is at.

What is the basis of future trajectory? Is it based on fantasy or excitement or the blind following the blind?

 

[Zathras]

What is the basis of future trajectory? Is it based on fantasy or excitement or the blind following the blind?

Depends who you ask.
Here is a fund manager who lays out their current case (well, current as of a few weeks ago?).

https://youtu.be/RqNAqotmZFg?t=69

Analyzing TSLA as simply an auto company is the biggest mistake most bearish analysts make.

 

[oneill225]

What is the basis of future trajectory? Is it based on fantasy or excitement or the blind following the blind?

Tesla is doubling their EV car production every year while the legacy auto makers are scrambling to figure out how to make a competitive product. Tesla is also the leader in autonomous driving. These are two huge markets that will start to blossom over the next few years.

Valuing Tesla as a fad or a version of GM for tree-huggers really misses the mark, but it explains why so many have dismissed this stock, to date.

The fact that so many still do not recognize the money to be made from electric, autonomous transportation only adds to my "excitement" over TSLA stock. By the time everyone wakes-up and wants onboard, the big money will have already been made.

 

[Animorph]

Well, Tesla will come close to 500,000 deliveries in 2020. Some new factories will start manufacturing next year. The China factory is still ramping up significantly. There are supposed to be over 500,000 Cybertruck reservations, a bunch of Semi reservations, and a some new Roadster reservations that indicate a strong demand for vehicles Tesla isn't even making yet. GM isn't doing that.

Certainly a lot of the excitement is driven by electric cars replacing gas cars in the future. Tesla has a jump on that trend. So how much of the total car market can they grab? They've got a good start on it.

Again, I have not looked into Tesla's fundamentals too deeply. I don't think I'd invest at the current price level since I'm more of a buy low investor. But I do think they will grow rapidly. Good luck predicting how fast and when it starts to level off. And I am holding 300 shares still. Soon to become 150 if they rise to the $750/share level. How crazy is it to even be thinking about that already?

I'm sure the Tesla shorts (and legacy car makers) thought the electric car market was niche at best, maybe as large as Prius sales. Tesla has shown electric cars aren't just tree-hugger wimpy economy cars. There is a giant market that hasn't even considered an electric car yet.

My dental hygienist didn't like the gas bill for her BMW, looked at other gas cars, and decided to get a Tesla Model 3. Without even consulting us! Quiet, clean, charge at home, simple to maintain, and cheap to operate. Plus very fun (and easy) to drive as a true performance car. And she liked the looks. I think it'll be a few years before Tesla growth starts to decline.

And that's just cars. Tesla is also a low-cost solar panel/roof and battery storage installer. And a utility company battery storage provider. And a lithium battery innovator. And fairly comprehensively vertically integrated. All potentially high growth markets.

 

[Christine]

What is the basis of future trajectory? Is it based on fantasy or excitement or the blind following the blind?

I look at the reports and documents from Tesla themselves. They have their growth plan available online. Then I compare their forecasts with their older forecasts and how successful they have been implementing those.


But I'm sure there are braindead gamblers who buy just because someone managed to earn big time and now they want to repeat the win.

 

[oneill225]

Tesla is about to start full production of the Model Y in China; likely in January. Here is a video showing some of the early cars and progress on the Shanghai plant (which has been producing Model 3s since Jan):

The Model Y just began production about six months ago in California, but it is expected to be the most popular Tesla model over the next couple of years. China will be the second factory to produce the Model Y followed by Giga Berlin in 2021 and Giga Texas in late 2021.

From what I can tell, VW is the only company offering a compelling mainstream EV alternative to Tesla, but their Id.4 won't be offered in the US until late next year. It is a little cheaper than the Model Y, but not quite as nice and the performance is just okay (relatively speaking).

Model Y/3 global sales are about to really take off. Along with the upcoming Tesla semi and Cyber truck (also arriving in 2021), Tesla stock should have plenty of momentum throughout 2021. Buy on those dips.

 

[ExFlyBoy5]

Interesting article today from Bloomberg.

I don’t make six figures, and I don’t know anything about puts and options,” Smith, 32, said in a phone interview. “I’ve just bought and held the entire time. I’ve never sold a single share.” Now Smith has joined the ranks of the “Teslanaires,” as some of the company’s investors call themselves, with a holding that he says has ballooned to over $1 million, fueled by a rally of nearly 684% this year as of Thursday’s close.

I wonder how many "Teslanaires" are out there?

 

[Zathras]

Interesting article today from Bloomberg.



I wonder how many "Teslanaires" are out there?

Probably quite a few.
Anyone who spent $7500 on TSLA at IPO (8-10 years ago) would have $1,000,000 in TSLA today (as long as they held).

 

[MRG]

It soared in the last 20 minutes of trading to close at $695.00 a share prior to S&P inclusion Monday. I had a limit order for that amount to sell half in my short term trading account and exited half of the position for a quick 20% profit. I'll let the rest sit for a while, there's more in our investments and a bunch was just added via index funds.

 

[ExFlyBoy5]

It soared in the last 20 minutes of trading to close at $695.00 a share prior to S&P inclusion Monday. I had a limit order for that amount to sell half in my short term trading account and exited half of the position for a quick 20% profit. I'll let the rest sit for a while, there's more in our investments and a bunch was just added via index funds.

It was pretty crazy the last hour of trading. I am curious as to what Monday will bring. 70 MILLION shares traded @ that price!

 

[Christine]

It was pretty crazy the last hour of trading. I am curious as to what Monday will bring. 70 MILLION shares traded @ that price!

I am curious about how much of the needed 160 mill shares the index funds managed to buy today. If they came up short then what happens on Monday?


And then there is the question of 240 mill or so shares the managed funds benchmarked to the S&P 500 would need to buy to follow the index. Except for today's blockbuster ending the volume has not been very heavy this week.

 

[ExFlyBoy5]

I am curious about how much of the needed 160 mill shares the index funds managed to buy today. If they came up short then what happens on Monday?


And then there is the question of 240 mill or so shares the managed funds benchmarked to the S&P 500 would need to buy to follow the index. Except for today's blockbuster ending the volume has not been very heavy this week.

I am not smart enough to really know the ins and outs of adding them to the index. I see that the Tesla Motors Club forum thread is VERY active today (the investors thread). There are quite a few people that have limit orders in for $1500-$2000, though