Author Topic: TSLA - Tesla Motors  (Read 708055 times)

Liberty

  • Lifetime Member
  • Hero Member
  • *****
  • Posts: 11450
  • twitter.com/libertyRPF
    • twitter.com/libertyRPF
Re: TSLA - Tesla Motors
« Reply #2880 on: May 16, 2019, 06:45:33 AM »
I wish other automakers actually made a bigger effort with volume production. Having good EVs isn't enough... You also have to sell lots of them to make a difference.

Hear, hear!

People (and I) may be concerned of buying a Tesla and company going BK on us. But there's as much concern IMO on traditional automakers giving half assed support (or pretty much none in reality) to their electric models that they produce, sell in hundreds (not hundred Ks), and then discontinue. I might not buy Tesla, but I won't buy a poor cousin EV from traditional automaker either.

Yeah, if Tesla didn't exist, the pace of overall progress in the rest of the industry would be even slower... And Tesla has been at it for over 10 years now and the rest have barely made a dent. They'd drag their feet for decades without real competition to light a fire under them and show consumers that it is possible to make great EVs that aren't huge compromises and look and drive like golf carts.
"Most haystacks don't even have a needle." |  I'm on Twitter  | This podcast episode is a must-listen


Castanza

  • Hero Member
  • *****
  • Posts: 548
Re: TSLA - Tesla Motors
« Reply #2881 on: May 16, 2019, 06:57:51 AM »
I wish other automakers actually made a bigger effort with volume production. Having good EVs isn't enough... You also have to sell lots of them to make a difference.

Hear, hear!

People (and I) may be concerned of buying a Tesla and company going BK on us. But there's as much concern IMO on traditional automakers giving half assed support (or pretty much none in reality) to their electric models that they produce, sell in hundreds (not hundred Ks), and then discontinue. I might not buy Tesla, but I won't buy a poor cousin EV from traditional automaker either.

I can agree with this perspective. Tesla really does have a superior product and the rest of the industry is content to half-ass their innovation. But this still won't make me an investor.

Can anyone think of any companies in the past which have been expected to go bankrupt like Tesla that beat the odds and managed to become successful profitable companies?

Liberty

  • Lifetime Member
  • Hero Member
  • *****
  • Posts: 11450
  • twitter.com/libertyRPF
    • twitter.com/libertyRPF
Re: TSLA - Tesla Motors
« Reply #2882 on: May 16, 2019, 07:15:05 AM »
I wish other automakers actually made a bigger effort with volume production. Having good EVs isn't enough... You also have to sell lots of them to make a difference.

Hear, hear!

People (and I) may be concerned of buying a Tesla and company going BK on us. But there's as much concern IMO on traditional automakers giving half assed support (or pretty much none in reality) to their electric models that they produce, sell in hundreds (not hundred Ks), and then discontinue. I might not buy Tesla, but I won't buy a poor cousin EV from traditional automaker either.

I can agree with this perspective. Tesla really does have a superior product and the rest of the industry is content to half-ass their innovation. But this still won't make me an investor.

Can anyone think of any companies in the past which have been expected to go bankrupt like Tesla that beat the odds and managed to become successful profitable companies?

I'm not making an investment case. I just want to see EVs to replace ICEs as fast as possible.
"Most haystacks don't even have a needle." |  I'm on Twitter  | This podcast episode is a must-listen

SHDL

  • Sr. Member
  • ****
  • Posts: 469
Re: TSLA - Tesla Motors
« Reply #2883 on: May 16, 2019, 07:15:46 AM »
Can anyone think of any companies in the past which have been expected to go bankrupt like Tesla that beat the odds and managed to become successful profitable companies?

Apple, around 1997.  There was some discussion about the similarities a while ago on this thread. 

CorpRaider

  • Hero Member
  • *****
  • Posts: 2190
    • The Corpraider
Re: TSLA - Tesla Motors
« Reply #2884 on: May 16, 2019, 08:16:55 AM »
Apple, Tesla 2008, Amazon 2001, Adobe, Fairfax, all the utilities in the 1970s, etc...

I said I was going to buy some TSLA when it came down to a 2x GM's EV/REV multiple, so....
« Last Edit: May 16, 2019, 08:22:34 AM by CorpRaider »

Castanza

  • Hero Member
  • *****
  • Posts: 548
Re: TSLA - Tesla Motors
« Reply #2885 on: May 16, 2019, 06:25:37 PM »
Saw this posted on Yahoo Finance comment section. Seems quite speculative but much more detailed than the typical comments on there. Anyone have any insights or opinions on the below thesis?

"Has Musk already had a "margin call" on some of his borrowing-against his TSLA shares? In October of last year, as Tesla's stock broke down to new lows, Musk started shopping for some super-jumbo mortgages on the mansions he owns. He was able to borrow around $50 million against those homes in December. Was he doing that borrowing to pay off some of his loans collateralized with TSLA shares?

For the first time in years, Musk had a small reduction (relatively speaking) in the number of shares he's using as collateral for his borrowing. We only get an update on the shares being used as collateral once a year (in a small footnote in the proxy materials for the annual meeting); little additional information is available to the public-shareholders about this borrowing -- even though, about 40% of Musk's TSLA-holdings are pledged as collateral for his borrowing, and the company specifically names this borrowing as a risk-factor that could -- if Musk defaults on the loans -- negatively affect the share-price.

In 2018 Musk had 13,774,897 shares pledged as collateral in these loans; in 2019 we now see he has 13,394,056 shares pledged as collateral -- that's a reduction of about 380,000 shares he's using as collateral.

The stock price recovered after it hit its lows in October; if the investment banks (who know all the terms of this borrowing, even while the public-shareholder is "in the dark") knew Musk was shopping for mortgages -- and there would be a pay-off on the loans Musk had likely gone into technical default on -- they would have been able to trade on this information -- they'd even "control it" if they were a lender in the mortgage deals as they could alter the terms giving Musk time on when payments would be due.

Musk is wealthy on-paper, due to the large number of TSLA shares that have been given to him as part of his compensation package, but has little in the way of liquid assets. I think it's likely at least some of the money he's borrowed recently was used to pay off a tranche of debt he's taken out using TSLA shares as collateral."

boilermaker75

  • Hero Member
  • *****
  • Posts: 1155
Re: TSLA - Tesla Motors
« Reply #2886 on: May 16, 2019, 06:45:16 PM »
Apple, Tesla 2008, Amazon 2001, Adobe, Fairfax, all the utilities in the 1970s, etc...

I said I was going to buy some TSLA when it came down to a 2x GM's EV/REV multiple, so....

SpaceX, their first three launches failed. The fourth launch was done with the rest of their monies and it was successful. If it had not been a success, they probably would have gone bankrupt.

Edit: And I believe the rest of their monies was actually the rest of Musk's PayPal monies.The guy has balls.
« Last Edit: May 16, 2019, 07:31:11 PM by boilermaker75 »

SHDL

  • Sr. Member
  • ****
  • Posts: 469
Re: TSLA - Tesla Motors
« Reply #2887 on: May 17, 2019, 04:40:55 AM »
Saw this posted on Yahoo Finance comment section. Seems quite speculative but much more detailed than the typical comments on there. Anyone have any insights or opinions on the below thesis?

"Has Musk already had a "margin call" on some of his borrowing-against his TSLA shares? In October of last year, as Tesla's stock broke down to new lows, Musk started shopping for some super-jumbo mortgages on the mansions he owns. He was able to borrow around $50 million against those homes in December. Was he doing that borrowing to pay off some of his loans collateralized with TSLA shares?

For the first time in years, Musk had a small reduction (relatively speaking) in the number of shares he's using as collateral for his borrowing. We only get an update on the shares being used as collateral once a year (in a small footnote in the proxy materials for the annual meeting); little additional information is available to the public-shareholders about this borrowing -- even though, about 40% of Musk's TSLA-holdings are pledged as collateral for his borrowing, and the company specifically names this borrowing as a risk-factor that could -- if Musk defaults on the loans -- negatively affect the share-price.

In 2018 Musk had 13,774,897 shares pledged as collateral in these loans; in 2019 we now see he has 13,394,056 shares pledged as collateral -- that's a reduction of about 380,000 shares he's using as collateral.

The stock price recovered after it hit its lows in October; if the investment banks (who know all the terms of this borrowing, even while the public-shareholder is "in the dark") knew Musk was shopping for mortgages -- and there would be a pay-off on the loans Musk had likely gone into technical default on -- they would have been able to trade on this information -- they'd even "control it" if they were a lender in the mortgage deals as they could alter the terms giving Musk time on when payments would be due.

Musk is wealthy on-paper, due to the large number of TSLA shares that have been given to him as part of his compensation package, but has little in the way of liquid assets. I think it's likely at least some of the money he's borrowed recently was used to pay off a tranche of debt he's taken out using TSLA shares as collateral."

IIRC the word on the street was that the margin calls were set to occur at around 200-250.  I was expecting the price drop to accelerate somewhat once we get there (due to forced selling), and it does feel a bit like that is happening.  I can’t prove it though.

benhacker

  • Lifetime Member
  • Hero Member
  • *****
  • Posts: 887
Re: TSLA - Tesla Motors
« Reply #2888 on: May 17, 2019, 01:53:21 PM »
The sheen is off.  This run today feels like the last transfer to bag holders.

There is plenty of information there for all to see, and while the delay in the media digging critically in on the story that is Tesla, I think it is now coming.  NYT now running stories on inventory build up.  LAT ran the article first, and continues to dig on Tesla/Musk.  The short selling "cabal" is getting some 'air time' as well.

I don't think Musk's actions which have attracted so much media and government attention will prove wise.  But perhaps he had no outs.

Will be upping my short tomorrow.  Signing off from here on Tesla talk for a while.  Hope everyone (including myself) keep an open mind on potential outcomes.

Final thing to note, Tesla delivery associate perpetuated (or attempted) what I would consider a highlight unethical if not illegal act on my friend who is waiting for delivery - lying about the status of his car ("it's in transit" --- hahah --- Elon says shortage of carriers to help back up these lies, but there is no shortage, his lies are getting weak), repeatedly changing the VIN# while not articulating why or alerting him to it.  When confronted about it, delivery specialist is non-responsive.  Although, he was clear to strongly suggest full payment to my friend....  It's a testament to the "brand" that he (my friend) hasn't asked for a refund.  If they continue delays, I think he may cancel.

The company is either next-level incompetent, or worse.

My friend had this to say while contemplating them as just being totally overwhelmed with bad logistics and inventory management (as an excuse for what they are doing to him):

"Have to admit, if this is the truth, any company that is currently that broken kinda deserves to be shorted."

The thing is, I think this (incompetence and bad planning causing the chaos) is the charitable explanation.

--

1) Extreme valuation
2) Bad accounting
3) Promotional management
4) Dishonest management
5) Extreme, Director/VP level employee exodus
6) Government investigations
7) Terrible manufacturing controls
8) Terrible financial controls
9) Bad governance / captured board
10) Uneven disclosure via different channels
11) Unclear demand environment w/ increasing competition
12) Extreme valuation
13) Liquid borrow at low rate
14) Expiring tax credits
15) Negative news cycle underway
16) Whistleblower lawsuits
17) Mechanic liens
18) Nearly everyone you talk to who isn't short, thinks you are crazy for shorting (my clients hate this short)
19) Dumb, oblivious, disbelieving, or non-economic longs (some are all of the above)
20) High beta name, well into technical breakdown (triple top failed, and >20% off ATHs) in a market taking a breather, but near all time highs
21) ... because I probably forgot one

Wanted to check in with a question(s):

Curious if any negative folks / shorts / haters, etc have a materially changed opinion in the last year or so?

Curious if any positive folks about the company / Musk, etc have a materially changed opinion in the last year or so?

For those long or at least open to the idea of getting long - what price would you be interested in stepping in (don't need to explain why)?

To share my view, my opinion hasn't dramatically changed - probably a little bit more negative than before, but broadly feel the same about Musk and the company's financial prospects.

Same directional position as before on the stock.
Ben Hacker
Beaverton, Oregon - USA

SHDL

  • Sr. Member
  • ****
  • Posts: 469
Re: TSLA - Tesla Motors
« Reply #2889 on: May 17, 2019, 03:09:51 PM »
This has been an interesting ride for me...

During last summer/fall I thought that there was an elevated chance of a near term liquidity event but at the same time I thought there could be a lot of upside if they do very well with the M3.  I therefore just bought a few OTM puts.

Then they did surprisingly well with the M3, at least for a quarter, and it was clear that my puts wouldn’t work, so I sold them. At this point it seemed to me like the M3 could keep them alive for a few years during which they could work on improving their business. I even thought I might go long at some point if there was enough evidence of such improvement.

And then during the last few months it became apparent that their cars weren’t selling as well as expected and that the optimistic scenario above was therefore unlikely to materialize. So I started a short position, and added a bit more after the recent capital raise. I will probably hold on to this for a bit longer than I otherwise might because I think it should work well as a macro hedge.

Not sure if there is anything to be learned from this experience, but it was at least a lot of fun and it probably kept me from doing other dumb trades when I was bored.