1/1/2015
guest Maybe there's a happy medium somewhere between instead of waiting 30 years for the return I would submit 5 years. John Q public may actually accept this quicker than we think especially with hybrids paving the way. Another big wild card is gas prices. I'm willing to bet we will reach the 5 dollar threshold sooner rather than later and that will be a huge positive upward pressure
from my Samsung galaxy s3�
1/1/2015
guest This is how I see it...looks like we are at a critical point on the chart, at least according to the technicals... What are your thoughts?
https://www.tradingview.com/x/20MOjisZ/
�
1/1/2015
guest Another thought:
https://www.tradingview.com/x/JroGC4D7/
Very cool website/tool for charting: https://www.tradingview.com/e�
1/1/2015
guest I don't understand the above chart. All I see is that after about the first 4 months, it's bounced up and down within about the same limits. The green and red lines mean nothing to me. They do remind me of when I was young and looked for patterns in everything. I don't think the mob mentality of the stock market can be predicted by lines on a chart. But that's just me. The price of a stock is what buyers and sellers agree to trade it for, and that's influenced by many things, such as confidence in the economy and the company, and a general consensus on the company's prospects.
I base my prediction of slow and gradual growth on my confidence in Tesla and my assessment of a generally slow rate of acceptance of EVs by the public. I've been driving electric for 5 years, and talking to people about my EVs, and I see a strong resistance to buying a car that takes hours to "re-fuel" every 75 to 250 miles. I think that reluctance will be overcome very slowly, and that the market will value Tesla according to people's willingness to buy their cars more than according to their ability to build quality cars. The latter is necessary but not alone sufficient to the former.�
1/1/2015
guest ...and one of those many things is technicals, whether you like it or not, or choose to ignore them. I understand charting isn't for everyone... so I have started a new thread for it: http://www.teslamotorsclub.com/showthread.php/10148-Charting-TSLA-What-Trends-Do-You-See
I completely agree, but I am talking about the stock (as this is the TSLA investor discussion thread) and its current/mid-term moves. I think we can all agree on our belief and hope for its long term success.�
1/1/2015
guest I'm long, so I think it will break higher in continuation of its 2 year trend.
�
1/1/2015
guest Do you actually use charting successfully? I always hear etrade people etc. talking about that and it seems like mumbo jumbo to me, but if it works, it works?!�
1/1/2015
guest I don't use it to trade, I like to think of myself as a long-term investor. It just helps me sleep at night...it allows me to convince myself that I understand whats happening :biggrin:.
But in all seriousness, yes, charting is a key tool for many traders. On the macro level, it allows you to identify breakouts, trading ranges, and the like. When you can draw a straight line on a chart and connect the dots, its "usually" not a coincidence.�
1/1/2015
guest Nice charts, and for me they help validate my current investment in Tesla.
I'm a latecomer to Tesla. Classic low information scenario where I bought into vague vaporware rumblings (which I now source to Jalopnik and their ilk).
So I've only started dipping my toes into Tesla as in investor in the past month or so. I would have started in May, but I figured it'd be a bad idea to jump in before what was looking to me to be a successful launch. Late money usually gets taken for a ride, and I figured if I was noticing Tesla others would be too.
But in the past month its looked to me like the shorts have reasserted themselves and the struggles with the ramp-up have been driving the news cycle. Which to me screams buying opportunity if you assume that Tesla is going to work through its problems. I missed when it hit the July lows, but I managed to get 80% of my current position in a narrow range around $28 with the rest purchased in the last couple of weeks in the $28-$29 range. I'm very comfortable with those prices in both the short and (especially) long term.
I don't understand how reinvesting its profits into R&D and its productive capital is a bad thing. Thats what growth companies do, and when it works it almost always makes more money for shareholders than dividend paying companies do. Profits are profits, and if you reinvest them to grow you'll make more money next year (assuming you have a good product and make sales). That increases the stock price and makes everyone richer. The smart thing to do is to keep doing that until additional growth becomes a bad thing. Then you turn boring and start paying dividends instead of trying to grow.
Tesla is a tiny automaker, worth ~$3 billion right now. Considering the potential strength of their product and potentially disruptive effect on the market, I see little reason why they can't be a major auto manufacturer in the next 10-15 years. And when you consider the size of the global market I could easily see Tesla being valued in the ~$50-$100 billion range.
A small portion of that potential is already baked into its current stock price, but if I believe that there is a realistic chance of 1,600-3,000% returns in the next 10-15 years I'd be a fool not to be buying right now. Of course the downside is Tesla might get diluted by 50% in the next 6 months to get emergency funding, but I'm willing to take that risk to get a shot at the big money I see at the end of the tunnel.�
1/1/2015
guest So am I. But I think that in the long term (which is where my interest lies) the price is connected to sales more than to chart figures, and sales depend on the perception of EVs by potential buyers.
I agree entirely. But someone was saying that the stock price would double as soon as there were profits, and I pointed out that the Roadster made profits. So what's different about Roadster profits and Model S profits? The former helped finance the Model S. The latter will help finance the Model X. And that will help finance the GenIII. For the next few years at least, the balance sheet is going to show the profits going back into growth, so why would investors react any differently to the presumed coming success of the Model S than they reacted to the success of the Roadster?
Tesla is doing exactly the right thing.
And that will result in slow steady growth in production to match a slow steady growth in public acceptance of EVs. But investors will still be strongly influenced by their own personal attitudes about the "practicality" of EVs. Everyone here believes strongly in the future of EVs, so we believe in the future of Tesla and TSLA. But until the greater investment industry shares that belief, they won't be willing to pay higher prices for it. So again, I tie the future price path of TSLA to general public perception about EVs. And this involves such a strong paradigm shift that I think it will be slow in coming.
People who trade based on chart "fundamentals" are trading for the short term. (Which does not preclude someone from also holding a long-term position.) There's nothing wrong with short-term trading, and if they guess right they can make money off of those who guess wrong. But that short-term trading is a zero-sum game, just like poker. And just like poker or Vegas, virtually nobody ever admits losing. And that makes me skeptical when people claim to use charts to win consistently*. In the long term, what matters is not patterns on a chart, but the success of Tesla in two highly-related "fundamentals": Their ability to build good cars, and their ability to sell those cars, on an ever-growing scale.
*(I knew a guy who consistently won in a regular weekly poker game with friends. He did it by bringing a case of beer to every game and never drinking any of it himself. :wink: And no, it wasn't me. I neither drink nor play poker.)
I think Tesla can do it.
But I would not bet my shirt on it, because there are too many ways they could go bust even if EVs do catch on.�
1/1/2015
guest Daniel:
Read the financial statements carefully. Tesla has lost something like $865 million to date; even if you back out $400 million for Model S/X R&D over the last 3 1/2 years, they lost a "hunk of burning money" on the Roadsters. Good for the Roadster owners, not so good for investors (unless they've cashed out as in Al Damaki.) You can make money trading Tesla shares, but you best be nimble.�
1/1/2015
guest Charts are interesting; what they're really doing, I believe, is identifying "herd patterns" in trader psychology.
It's been shown that a good chart trader can beat the market *until he explains his techniques and they become famous*. That changes the herd psychology and then the chart traders have to start their research into patterns all over again...
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Well, I bought my Tesla stock in an IRA where I can't actually get the money out for THIRTY YEARS.
The key subtle question is whether you're talking net income or gross income. Taxing gross income horribly penalizes low-margin businesses, which is why it's not done that way for businesses. Personally I favor taxing net income for individuals as well as businesses; add up net wealth last January 1st, add up net wealth this January 1st, subtract, that's your income on which you should be taxed. This avoids penalizing people who have horrible, crippling medical expenses, or expenses for special diets which they have to follow for medical reasons, and also avoids penalizing people who stupidly squander all their money and get nothing for it, and people who have sunk deep into debt where all their income goes to debt collectors; it taxes the people who are *actually getting ahead*, actually benefitting from our society.
Sadly, no candidate has advocated such a plan *ever* in the *entire history of income tax* as far as I can tell, so it's an even harder stretch than your proposal. :-(
(I also support things like pollution taxes -- charge polluters for the costs they cause to everyone else -- but those shouldn't be done through the income tax, those should be done directly.)
�
1/1/2015
guest Two problems: It's monstrously difficult to calculate net worth when some of it is in assets that are not traded daily, and market fluctuations can cause net worth to rise or fall a great deal from one day to the next. I agree that taxing gross income for a business with a narrow profit margin won't work. For businesses, net income makes more sense.
As for people going bankrupt due to medical expenses, that would not be an issue if we were a civilized country and had universal health care like every other industrial nation in the world.
Regardless, the myriad deductions, exemptions, tax credits, etc., only serve to wildly distort the economy and give free money mostly to the rich.�
1/1/2015
guest Just some conversations I've been having in other threads which belong here.
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Anyways, it looks extremely likely to ME that Tesla will report 500+ sales and 700+ produced cars in Q3. See the link to Elon's interview and my analysis of the ramp up and scheduled deliveries for why I think that.�
1/1/2015
guest Delivery bottleneck?
I gonna guess that at the end of the year Tesla has a parking lot/factory full of undelivered cars and says they have built XXXX cars ...�
1/1/2015
guest They already did it... If you look at exact wording of last but one post on blog, they were stating that they produced 100 cars, 74 of them for delivery... So it is totally expected. And absolutely fair.�
1/1/2015
guest delivery = go into customers hands. The remaining 36 are for test drives, testing, instructing delivery specialist and engineers. Get your facts together before speculating on a delivery bottleneck on 36 cars.
I admit that it is a daunting task to ramp up delivery operations to 500 cars a week. OTOH it is no problem to deliver 1500 cars a day. I live near a car factory and I see deliveries via customer centers, train and road transport every day.�
1/1/2015
guest > My guess is that the bulk of the notifications are apt to come in the next week or so for Sigs and we'll start to see notifications for regular P numbers in the week after that. [CO]
"regular P numbers" - Make that "F&F numbers" - there are at least 486 of these, which could take up to a month to complete.
--�
1/1/2015
guest But those are still indicated with a P#xxxx, right? They just make up the first 400-500. I don't see how the F&F distinction makes any difference. They are still regular production.�
1/1/2015
guest You just stating the obvious.
Have you read my post? And conversation? Please read next time before replying. Not to mention - what those 36 cars have to do with delivery?
And I just agreed and reinforced opinion of vfx, who speculated that Tesla Motors will publish data on number of cars actually produced, not number actually delivered. And I have pointed the fact that they already reported numbers of produced cars, not delivered ones. Please read Tesla blog. And I would expect them to continue to do so for time being.
As for "delivery bottleneck" - I have no opinion about it. It might or might not happened. But not likely because there is well developed competitive market for deliveries, and "Tesla Delivery Specialists" are easy to train and not that many required, even if you take into account 83 per day/20 000 a year car production/sales targets. There are much bigger risks involved that on the TM plate right now, then deliveries...
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And no, at the time blog was written those 74 cars was not delivered, at least not all of them. I hope that is clear to you...�
1/1/2015
guest Delivery bottleneck �. Musk 9/13/12 "we will make 80 cars this week" 3:10 min mark
CEO: Tsunami of Hurt Coming for Those Shorting Tesla...
Wow ! ! !�
1/1/2015
guest That's "old" news around here :wink: TSLA Investor Discussions - Page 294�
1/1/2015
guest I'd settle for having the standard deduction be equal to the cost of living computed for your place of residence. Currently it is obviously far lower than that.
Yeah.
Yeah. Complication in the tax code generally benefits those who can afford full-time accountants...�
1/1/2015
guest Up 7% in premarket�
1/1/2015
guest OMG - Bye, bye short sellers! I wonder if Elon's statement has anything to do with the pre-market advance? " . . tsunami of hurt coming for short sellers"�
1/1/2015
guest Looks like Morgan Stanley jumped on board too.
7:11 EDT - Morgan Stanley lifts Telsa Motors to overweight from underweight saying the company has the ability to significantly outperform as analysts expectations have been dampened by delivery delays. Morgan Stanley says, "We expect the Model S to be a commercially successful product that can trigger even greater volumes of Model X and its derivatives." Firm lifts its price target to $50 from $45, saying the risk-reward for TSLA is better than other auto stocks it covers. TSLA up 7% to $32.51 premarket. ([email�protected])
$50 would work very well for my portfolio!�
1/1/2015
guest Could also be something to do with Elon tweeting a photo of S number 396 yesterday. After musings of delivery delays, analysts woke up and realized that producing ~500 before the end of Q3 is realistic after all.�
1/1/2015
guest Seems to me that if TM can hit (Elon tweets or GB blogs) 200 cars/week prior to October we'll most likely see shorts exiting the building. I'd love to see a squeeze but couldn't imagine shorts staying in until the last minute.�
1/1/2015
guest I know you guys don't like to talk charts, but this is a very pretty picture and I think you'll appreciate it.
�
1/1/2015
guest It's not just being able to pay for an accountant. If you buy a ten-million-dollar house, you get a bigger mortgage deduction. The charitable-contributions deduction means that rich people have a disproportionate say in what charities get supported, since the higher your tax bracket, the less it costs you to give a dollar. A rich person buys a luxury car for his business and writes it off on his tax, where a poor person cannot; and even if a small businessman can write off a car, it will be a less expensive one, so he gets a smaller tax break. Across the board, the dollar amounts of tax breaks are greatest for the rich. If you are in a high tax bracket, you benefit from tax-free municipal bonds, but in a low bracket you don't get enough benefit to compensate for the lower interest rates.
Using the tax system to promote policy objectives creates large benefits for the rich, makes it impossible to do an accounting of the cost:benefit of those tax breaks, and complicates the tax system to the point where ordinary people need to pay someone to do their taxes. By every measure, it is counter-productive to use tax breaks for policy objectives. But it allows politicians to get votes by claiming to an ignorant populace that they are reducing their tax bill.
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What's it even mean?
Here's another picture:
Hey, I'm always happy to see it go up. I just don't see where the red and green lines on the first chart come from or what they mean.�
1/1/2015
guest Point is just that they have been a ceiling for a long time now, note the times we've tried to rally and bounced off the green. Even when we do get past it we fail to break the red. Now we are through both of them. Technically speaking, this is very good news.
Now the fundamentals and technicals are in our favor.�
1/1/2015
guest Those are moving averages with different parameters.�
1/1/2015
guest It looks to me like the red and green lines represent the 200 day and the 50 day moving averages. IMO, there will be more volatility to come. Many days of several percent up and several percent down, until a majority of the shorts exit in Q4, and the stock calms down, on expected sales of $1.5B+/- in 2013, based on the backlog of reservation holders, and 1,600 cars produced monthly, and (oh yeah) profits. Can't forget that.�
1/1/2015
guest Agree, but volatility that stays above these lines is now more likely than volatility that falls back below them.�
1/1/2015
guest I'm thinking it looks like Brownian Motion.
(For a more thorough explanation, read the Hitchhiker's Guide to the Galaxy.)�
1/1/2015
guest A "long time" being about two months. Meh. It was higher at the end of 2011, and for a big chunk of this spring and again in July.
My feeling as well.
It's headed up. It can't fail to go up as Tesla convinces more and more people to buy their excellent cars. But it's going to do the Brownian dance all the way. People can gamble on the fluctuations, but I'm a buy-and-hold kind of investor. I do sell holdings that seem to have worse long-term prospects than I thought when I bought them, but as long as a fund appears solid or a bond doesn't seem likely to default, I just hold. A lot of buying and selling is like switching lines at the grocery store. It's always going to end up taking longer if I switch than if I pick a line and stay in it.
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Ah, yes. A good hot cup of tea to operate the Infinite Improbability Drive.
"Is something like this going to happen every time we operate the infinite improbability drive?" -- "Very probably."�
1/1/2015
guest Sigh...I give up.�
1/1/2015
guest love the upward movement.. dumped a bunch of shares�
1/1/2015
guest Please don't, C-T. I've learnt a lot about market movements and trading thanks to your informative posts!�
1/1/2015
guest And this time on significant volume! Now approaching 3.0B shares traded (avg around 1.0B). Previous attempts to break upwards were all on terribly low volumes. Fingers crossed!�
1/1/2015
guest You mean million shares, not billion.�
1/1/2015
guest Still, volume was pushed by a (relatively) small number of big trades.�
1/1/2015
guest Oh, I'm not going anywhere. Just had enough for today.�
1/1/2015
guest Here are some excerpts from the research note from Morgan Standey that caused the uptick today:
�
1/1/2015
guest Wow, a sensible analyst. Who'd a thunk?�
1/1/2015
guest ^^^ Well he's probably right for Q3, but I suspect he's going to be (pleasantly) surprised about Q4.�
1/1/2015
guest The Analyst That Sent Tesla Shares Surging
Bloomberg interviews analyst Adam Jonas from Morgan Stanley about the TSLA upgrade.�
1/1/2015
guest Hmm...�
1/1/2015
guest Awesome! Listen for comparison to Bugatti veyron!
from my Samsung galaxy s3�
1/1/2015
guest What do you guys think of making a risky play on the Supercharger announcement Monday? Depending on how this week plays out, I am thinking of moving my
Cash in TSLA to see if there is some pop on Monday.
Thoughts?�
1/1/2015
guest The announcement could cut either way, from an investor's POV. While long-term investors might become more comfortable that EV adoption rates will rise as a result of the SC network, short-term investors may see the SC network as a negative because it is a further demand on Tesla's cash and on its management team's scarce time/attention. Frankly, I expect the short-term POV to dominate, so we may see a price dip.
What the market is looking for, IMO, is cash in the door == car deliveries. With the current rate of cash burn, Tesla will need to do a secondary offering unless they can crank up deliveries.�
1/1/2015
guest I'm looking forward to the day where 1) full ramp has occurred, 2) reservations continue to fill the pipeline, and 3) enough time has passed that investors quit worrying about some catastrophic quality problem. That can't happen overnight.
In the meantime, I'm long.�
1/1/2015
guest I am risk-averse. You're talking about gambling on short-term prospects. Plus, though the announcement comes Monday, everyone knows it is coming. I think being long on Tesla is a good position, but gambling on any given day's market reaction is just that: gambling. What do I think? Bad idea. I've got 200 shares and am happy with them. I'm holding them for the long term. If it drops way down again I might pick up another 50. But not on hopes that the market will react to an announcement everyone knows is coming.
Caveat: I always think that short-term investing is a bad idea.�
1/1/2015
guest Do you believe Musk's pre-announcement hype? It's probably the closest thing we've had to a Steve Jobs Reality Distortion Field in years. If you believe Musk when he says that it's the announcement that will make electric cars "make sense" to people for the first time, then you should consider it. I don't think the market has priced any such major impact announcement into the stock.
If, however, you think it's just an expensive and ambitious plan for a bunch of quick chargers that let people drive across the country with 1/2 hour breaks every 3 hours, then you should pass.
However, you're willing to take a long-term view, then buying TSLA stock before the announcement to either sell quickly if it pops or if it doesn't then hold for a couple years isn't so bad.�
1/1/2015
guest
I have to keep reminding myself that the announcements are not meant for me (us) who have a deep understanding of electric capabilities.
When Elon says something about how amazing it is then probably not so amazing to me in that I can probably guess close to what he is planning. (though he always throws in a coupla' wow twists). For the general public, these are usually sit up and take notice advancements so the hype was probably justified.�
1/1/2015
guest Some of us quieter folk really like your analysis so keep it coming.�
1/1/2015
guest Yes, I think this is key and very insightful.�
1/1/2015
guest Indeed. Very much the way I - as a techie - find all the hype around an incremental refresh to a smartphone rather silly. All that marketing hoopla is really aimed at Joe Schmoe.�
1/1/2015
guest As stated earlier it depends on how earth shattering you think the announcement will be. The smart money has been bidding up the stock for a week now, and it's rarely a good idea to buy into a rapidly appreciating stock if you are hoping to just flip it. Of course I thought the real estate market looked overpriced in 2003 and a lot of folks made bank flipping properties for years after that
(And to clarify, I don't think the stock is overpriced right now. I'm just a sceptic about trying to play a short game)�
1/1/2015
guest It is not my intention to try to make you stop posting. I am skeptical of chart analyses and will continue to post my opinions. I hope you will continue to post yours. I do not understand why crossing the 50 or 200 day moving average is significant, or why we should expect the price to stay above or below once it crosses that line. But I read your posts with interest. I'm not a short-term investor and I doubt I ever will be. But learning what motivates others, or how they make decisions, is always interesting. Do keep posting. I will also. I think the short-term fluctuations are a drunken walk, or Brownian motion, sufficiently chaotic to be unpredictable. Contrary opinions are always welcome.�
1/1/2015
guest I'm not going anywhere, don't you worry. In fact, here is a really, really long post with various thoughts.
Rather than opinion I present you with fact: I'm up 120% on TSLA alone so far this year by watching the "drunken walk" and making moves based on it. My trading log says I've made 12 good trades and 2 bad trades in TSLA this year. That is not the kind of performance I expect to see from something that is "sufficiently chaotic". Just because you can't predict the moves doesn't mean they are unpredictable.
If you don't have a good understanding of why these things are important, or don't have the time and inclination to learn why they are important, that's fine. I don't advocate that everyone should do chart analysis or try to capitalize on this kind of volatility. In fact, if you don't have the time and inclination I would say DO NOT make short-term trades, you'll get killed.
That said, if you don't understand, participating in an argument about whether a move is technically significant or not seems pretty silly. You can dislike it if that is your persuasion, but the vast majority of professional investors use technical analysis to decide when to buy and when to sell. So realize that you are an amateur ridiculing something that you admittedly don't understand which is the industry standard. Even if you are right and it is just numerology, the fact that all the big money playing in the market is looking at the same thing makes it worth paying attention to. A sort of self-fulfilling prophecy if you like.
I welcome a discussion with anyone that is looking at the same chart and seeing something more or something different from what I saw. The comment about the low volume of the previous failed rallies was a very welcome addition to the conversation.
How about an example? Again, rather than opinion I present you with fact:
Is it purely by chance that the blood-letting yesterday stopped right at that red line, or did I tell you the day before that the probability of falling back below that red line was less than the probability of staying above it?
I was able to save some of my winnings from Monday by selling a bit at ~$32.50 and buying back when we touched that red line. Did I get lucky? Maybe. Did I take a calculated risk that was measurable? Absolutely. Is it still possible that in the coming days I'll be proven wrong and we will eventually fall below that red line, then the green one? Yeah, sure; but, the probability of that happening is less than the probability that we stay above it based on my calculations.
As always, any new news has the ability to completely disrupt these probabilities. Other's much smarter than I would beg to differ, but in my experience, this analysis is only valid in a vacuum. So when the news changes, I throw it all out the window. As an example: I made a comment some months ago that the 200-day was going to $35 and I was sitting on my hands until then. We stayed on that path for several days and my confidence was building, then news of production delays showed up in our forums which completely voided my predictions. I threw the whole plan of attack out and sold a chunk that day at ~$35.50.
Now, that was a great trade, but I incorrectly predicted that the 200-day or 50-day would be able to stop the selling after that news. I was wrong. One of my 2 bad trades this year was trying to buy back at that 200-day, which was far too early.
The reason that your comment about what the stock price was last year or whatever wasn't valid is because the new technical cycle only started after the sell off from that bad news. Furthermore, you'll note that we were stuck in that pattern of being unable to break through the 200-day while there was a news void. When we received the good news that production was ramping up better than the streets latest expectations, we again broke through the barrier (for the better this time). Now I believe we have entered a new technical phase, one where those lines provide support not resistance. If I'm right, what the stock did last week is just as irrelevant as what it did last year.
Again, news has the potential to send us right back below that line. For instance, if the supercharger announcement is a big letdown, or is so expensive a project that it brings Tesla's cash position back in question, we could be right back where we were last week.
While I don't suppose that I've convinced you that this stuff works, I hope I've at least given you the impression that we aren't just reading tea leaves here. There is a process, with rules, and math to be done; and, its effectiveness can be measured. So, while I don't expect you to adopt this strategy yourself, dismiss it out of hand at your own risk.�
1/1/2015
guest +1 - As Cali would have said, there is no reason for these wild swings. The charts work just as well as anything else and they'll work until they don't.
It's much easier to pick the game-changer fairly early and then hang in through the turbulence. Those who saw the revolution of iPod/iTunes and invested in it for the long term made money. Those who saw the revolution of Google's simple/elegant and yet effective search engine/marketing model made money. Likewise, iPhone, iPad, etc. I was blind to all of them but the iPad, but when it came out, I was against buying individual stocks. With Tesla, I see another paradigm shifter, and this time I'm ready.
Edit: I think Citizen-T's analysis is good and for those with the stomach and time, it might be a good strategy.�
1/1/2015
guest Looking for a good entry point: any ideas?
Are we going to see high 20s again, you think? Really not sure how to play the SuperCharger announcement.�
1/1/2015
guest RE: Citizen-T's #2981 post...
I would liken it to power running to your house. The fluctuation in power (in the extreme case brownouts) has some patterning to it, and often you could make more-than-weather-forecast-reliable predictions about it. But there are meta events, like unplugging your house from the grid, that trump the patterns.
One key point where I disagree with his commentary is the measure of "12 good trades" vs "2 bad trades". These are not generally comparable. The number of trades is far less interesting than how much those trades gained or loss. When I was doing some aggressive options activity one year, I had over 200 trades in one year. Only like 5 were "bad trades", but the amount of loss on those trades effectively cancelled out like 100 "good trades".�
1/1/2015
guest But he's up 120% on those 12 good and 2 bad trades. Wished I had the insight and stomach that he had to make those trades, I would be a Sig owner now, versus being very nervous about wether I can really afford the 60 kWh pack...
Btw. I reluctantly bought 100 yesterday at $31, in the hope to make some gain before I have to cut Tesla the check in (hopefully) December.�
1/1/2015
guest That's akin to gambling with such a volatile stock. I hope it works out for you of course.�
1/1/2015
guest Thanks. I appreciate the long, detailed posts.
OTOH, a rising tide floats all ships, and the market is up about 25% since January '09. I do wish you and all the others here the best of luck. You're up 120%. Scaling to the approximately $6,000 I have in TSLA, would I gamble $6,000 in the hopes of winning $7,200? No, I wouldn't. Would I gamble $6,000 on the long-term success of a company I consider well-managed, that is engaged in what I consider a socially beneficial enterprise? Obviously, yes.
I'm curious as to whether you are trading in other stocks as well, or just Tesla? (Obviously, you don't have to answer.)
(I'll answer my own question: I have tiny positions in three other companies that I like. I bought them several years ago and just sit on them. My real investments, the ones I live off of, are mostly mutual funds and a few bond issues. On occasion, on the advice of paid professionals, I sell something and buy something else, but only rarely, and for reasons related to the fund or company, never to try to capitalize on short-term market movements.)�
1/1/2015
guest I think (I could be way off here) by "up 120%" he means he has more than doubled up. That's plausible in my book. I've been following the same technicals for the last year, and paired with knowledge of the company and access to news early (forums) this stock has been very good to trade. I've learned to trust my own conclusions and to also start believing in the fact that with my interest in TSLA I'm actually most of the time "ahead of the market" when it comes to hearing and especially understanding/interpreting news. I'm up 30% in the last 9 months, but about half of my position I ser as core (long long) while the other halve I trade (so I guess my traded position is up 60%).
I do agree though with brianman, it can take just one poor trade to cancel out even hughe gains over night. However, in that scenario I'd think a really long position would also sugfer.�
1/1/2015
guest That's how I understood his comments also. My reply stands.�
1/1/2015
guest There is also, however, that the belief that it works affects the behavior of enough people playing the game that it does end up working after all. That you allude to "Big Money" using this analysis is consistent with that belief.
For instance, if enough money thinks the stock will drop until the red line, then the stock price will continue to drop until it reaches the red line, at which point enough money thinks that's the bottom and so starts to buy, thus preventing the stock price from dropping below the red line. So, even if this wasn't true, that enough money believes it to be true makes it true.
Now, anyone want to tell me whether the cat in the box is dead or alive? :wink:�
1/1/2015
guest Going to change your name from smorgasbord to schr�dinger?�
1/1/2015
guest You would let the cat out of the bag.�
1/1/2015
guest -grin- Not always!�
1/1/2015
guest 
What is it with cats and boxes on TMC?!?�
1/1/2015
guest This is how the world works. If you can convince enough people that something is possible - it will be possible!
Or just concvince yourself - and you can do anything, absolutely anything!
Stock, media, everything seems to follow these rules.
tough to actually learn and implement properly(but doable)�
1/1/2015
guest You are absolutley correct. Remember the original "startrek"?
the flip open communicators? flip phones and cell phones now exist.
the "pads" they used to use to take notes on? we now have tablet computers, in fact the iPad seems to have been directly inspired by StarTrek
I don't want to be FIRST in line, but in the first group of 10,000 that gets to try out the "transporter"
and who's up for a ride on the enterprise? thats comming too, look out Space-X�
1/1/2015
guest Thanks for the explanation of the Technicals Citizen T. I think I could be successful with short trades in Tesla If I had the time. As it is I am still levering my position with options. This is my first time in the market and I am 28. I have about 70 percent of my position betting on the next 6 months to a year. If i lose everything I will be fine ... I consider it a low price to pay for future success in the market. Keep up the informative post please.�
1/1/2015
guest Physics tends to disagree at a certain point.�
1/1/2015
guest John Peterson will not give it up. Why Merrill Lynch, Morgan Stanley Are Wrong About Tesla - TheStreet Correct me if I'm wrong, but it appears that he's forgotten that a deposit is not equal to the purchase price.�
1/1/2015
guest I'm starting to wonder if JP knows absolutely nothing about GAAP or whether he's just being deliberately obtuse. That latest article is plain gobbledygook.
He's mixing up working capital with pure cash and suggesting that Tesla's financial situation worsens as deposits are converted to revenue, totally ignoring that those deposits are only a fraction of the total revenue stream from finalized car sales. Huh?
It was stated here on TMC and plenty of other places months ago, that Tesla might sail close to the wind from a working capital perspective but they had the back-up of a remaining $33million to be drawn down from the DOE loan and income from the development services for Daimler which only started in Q2. That said, we also have to remember that the situation improves with every car delivered (conversion of inventory to revenue and profit) and Tesla has a whole bunch of cars being delivered already and what's starting to look like hundred's in the next four weeks.
The big banks don't always get it right but generally they tend towards caution. Let me see Merrill Lynch & Morgan Stanley or John Petersen...experienced, successful financial analysts or a blogger who doesn't appear to understand basic accounting.....hmmm, who would I bet on being right?�
1/1/2015
guest JP lost me at *2,000* Signature reservations as that presumably makes his "math" better.�
1/1/2015
guest JP believes that the analysts did not model the deposits accurately. It appears that JP is concerned about TSLA's working capital and cash; revenues and income/loss are not affected by deposits. If the sales backlog stays the same or increases by less than a factor of eight ($40k/$5k), the smaller deposits ($5k per car) do not offset the reduction of the $40k deposits sitting on the balance sheet. A reduction in the rate of new deposits will decrease working capital.
The big, unanswered questions are, (1) what type of additional capital does TSLA raise (equity), (2) when does TSLA raise that additional capital, and (3) how much do they raise? The cost of that new capital will be lower when TSLA has a record of production through the Fremont plant although the more TSLA needs capital and the faster it needs capital, the higher the cost of that capital.
Overall, there will have to be dilution and new capital will be expensive. Offsetting that is the increase in value of the company. Which side will be greater?�
1/1/2015
guest Pretty bad when a balance sheet noob like me can see the obvious miss. Embarrassing to be him.�
1/1/2015
guest Deposits have always been part of working capital, it wasn't in any sort of escrow fund (unless you live in WA which has a special state law).
Nigel made an absolute stellar post on it back here debunking some of the same lunacy JP is spouting today. One of my all time favorite posts on TMC.�
1/1/2015
guest Accounting is picky, so I'm going to allow myself to be picky (please forgive me in advance)....revenues and income are affected by deposits when those deposits are converted to revenue. JP ignores that point.
True, but that ignores the fact that most of the Sig are looking like >$100k cars and average price of other cars is sounding like $75-80k right now. So there's additional cash inflow (revenue) of >$60k for every Sig and >$70k for every other car (that may drop once the smaller battery packs come online). That's new cash flow of $60m for the Sigs alone, plus (let's be real conservative and say that Tesla will only deliver the Sigs plus 1,000 cars this year) $70m from other cars giving $130m in total. Working capital is not compiled solely from deposits.
Tesla/Elon said that raising new capital is always an option, but not one that they need right now.
Well that's an absolute (and you're entitled to your opinion) but I don't see it yet.�
1/1/2015
guest There are only 1000 Sig reserves correct? Or are there another 1000 international sig reserves?�
1/1/2015
guest 1000 USA, 200 Canadian, 500 European.�
1/1/2015
guest So Tesla has a $5000 deposit from an owner. Months later when the owner gives Tesla another $54,000 dollars at delivery of their Model S, then Tesla looses money?
I'm confused. Is John saying Tesla has already put $54,000 (or $59,000) on the books so deliveries are loosing money because of the cost of actually building and delivering the car has them spending money they up to that point were (not actually) sitting on? Is that what he's saying? I'm not even sure what I'm saying.�
1/1/2015
guest There might be a point vaguely similar to the one JP was making, but it's not the point he made:
Consider a Signature reservation. At the beginning of the year, Tesla had $40k of cash. The gross margin on the car is about 25%, so for a $100k Signature the COGS for the vehicle is (let's say) $75k. Therefore, at the end of this year, Tesla has $25k of cash in profits from the sale of the car, down from $40k of reservation cash. (Of course, Tesla no longer has an offsetting liability associated with the deposit, either.) So, in a sense, each Signature "costs" Tesla about $15k in net cash.
JP also seemed to be oblivious to the accelerating pace of reservations, adding cash to the coffers.�
1/1/2015
guest JP pointing out "supposed" mistake made by Merrill Lynch and Morgan Stanle, that actual cash inflow from 2,230 sales(Morgan Stanle)/5,000 sales(Merrill Lynch) would not include deposits and total miscalculation is $81 million/$95 million respectively.
First, there would be only 1200 Signatures MAX delivered this year, so "miscalculation" if it is there would be way lower. In comments section JP suggested it would be QUOTE: "only $67 million for Merrill Lynch and $52.6 million for Morgan Stanley."
Second, JP conveniently "forgot" to mention that as production ramps up, there are more reservations coming, including Signature reservations for Model X.
Third, whole JP point is Tesla liquidity, presumption that Tesla Motors is about to run out of working capital and would need cash fast. First I do not believe that is the case. Elon was saying something that while they spent ~60 millions in a second quarter on capital expenditures he felt like that number was somewhat low and they they hoped to spend more buying new equipment. Not exactly the message you would expect to hear from company that have problem with working capital.
And above all, JP was predicting doomsday over and over again, I'll quote: "Collectively, these factors will leave Tesla in a position where its June 30, 2012 financial statements look like an absolute train wreck unless it sells a substantial amount of additional stock within the next three weeks.". Should I mention that so far Tesla have not raised any capital by selling a substantial amount of additional stock?�
1/1/2015
guest I was confused about this, too. I think he's trying to say that the analysts are not taking into account that the reservation part of the cost of the car has already been received - the analysts are modeling the full price of the car as new revenue.
BTW, Tesla's latest 10Q states that the reservations are counted as a liability on the books, but can be used for any purpose by Tesla:
"These amounts are recorded as current liabilities until the vehicle is delivered ... Amounts received by us as reservation payments are generally not restricted as to their use by us." - View Filing Data�
1/1/2015
guest Not at all, in your example Tesla receives $60k more cash from the customer than they had before. Comparing cash flow with net income is a bit apples and oranges.�
1/1/2015
guest Nigel, I was assuming that during the course of the year Tesla had to spend $75k to purchase materials and labor with which to construct the Model S, which they then sold for $100k. And I was trying to stay entirely on the cash issue, which seems to be JP's concern.�
1/1/2015
guest Accounting practice is that deposits are a balance sheet liability and may not be recognized as revenue until there is an irrevocable purchase contract or a completed sale. Deposits are however cash counted as part of the company's cash flow as they have free use of it unless it's in a jurisdiction where this is not allowed (e.g. WA state I believe). JP claims to be a CPA but seems to me he's forgotten some of the basics.
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If JP's concern is cash flow, then ignore profits/margins for a second....Tesla had $40k coming in as deposit and then $60k more when the car was delivered; this was positive for cash flow. If the concern is working capital the sum is entirely different and yes it could be argued that the effect on working capital is a $15k reduction but that would be disingenuous because working capital is also affected by e.g. inventory movements. In a fast moving consumer goods business working capital doesn't matter so much and although normally I wouldn't classify Tesla as FMCG, with an impatient and long waiting list they can recover cash from inventory pretty fast if they need to.
Let's take a look at using Petersen's Accounting Practices (from hereon to be known as "PAP" because that sounds like a good word to describe them): What JP misses (among other things) is that the number of Sigs is limited and the way he calculates it as soon as the first P number is released Tesla exchanges a $5k deposit for $25k cash profit on every $100k car and therefore working capital increases by $20k per car. So using PAP Tesla only needs to deliver 750 performance production cars and they covered all the 1,000 U.S. Sig cash "losses". (Note: that last paragraph bears little/no relationship to actual accounting practice).�
1/1/2015
guest And the fact that each WA sale (one of the highest reservation and sig reservation states) is 100% new cash for Tesla�
1/1/2015
guest Thanks for the answers. JP's PAP is so shortsighted that I could not follow.
I guess he's drinking his own flavor of "Tesla will fail" koolaid and assumes in his "calculations" that the company will only deliver Sig cars for a few months.�
1/1/2015
guest I fail to see the point of his editorials (if you'd even call it that). Aside from the fact that his math is wrong he clearly doesn't understand consumer products and vehicles. At Tesla's stage in the game the financials aren't going to tell you anything. Look at the product and the way that the company is managed. That's what Microsoft did when Apple was near the brink of bankruptcy and now look.
I also abhor the fact that he defends himself WAY too much and gets really snippy about it. He should put his money where his mouth is and go ahead and short the stock. I highly advise investors being influenced by what he is saying to tune out the noise and go with your gut and your own analysis. I'm doing that this time around and put my entire life savings into the equity. I know it isn't wise but I've seen the BETA product and came away impressed. I've read so many posts and also looked at the business model and management style of Elon Musk. It's VERY similar to Apple's so I put my money where my mouth is.�
1/1/2015
guest Life savings? How bout them apples.�
1/1/2015
guest Posting about JP is a waste of effort. The guy is a doofus who has no regard for facts. He probably has a short position in TSLA and he's desperately trying to drive the stock down enough that he can get out without being wiped out.
I think you're joking. But I've heard people say this with a straight face. Convince yourself all you like, you'll never be able to play the violin like Hilary Hahn, or beat Gary Kasperov at a game of chess, or fly by flapping your arms, or hold your breath for an hour, or re-grow an amputated leg.
Of course, there are many things you can do if you work at it hard enough. Believing you can do something may help motivate you to try. But I've done things that I went into not knowing if I could do them or not. The only really true statement about belief with regards to success, is that if you believe you cannot do something, you probably won't try. You don't have to believe you can succeed in order to succeed. You just have to believe there's a possibility you may succeed, and you have to want it badly enough to put sufficient effort into it.�
1/1/2015
guest Any one else notice on the "Deliveries" thread that the VINs are all of a sudden "TBD"? Anyone else thinking that this may be a sly plan for a Q3 production surprise?
Disclosure - I am long TSLA and sell some mad puts on it too.�
1/1/2015
guest Mine was originally TBD when given to me. I got the VIN shortly afterwards. I wouldn't read into it at all.�
1/1/2015
guest I would not make a big deal out of it. Anyone sane would figure out that +200 or -200 cars in a third quarter or +-1000 cars in a forth quarter would mean two weeks deviation from planned production targets...
Market wont penalize or reward for such under performance or over performance by too much. If you are long long - you are betting that Tesla would have at least 5 cars line up (2 sedans, 2 SUV and sport "supercar") . And would be able to deliver them at healthy gross margins. If you are short - you better hope that Tesla will start to show REAL signs of biting the dust in next 6 months, if not sooner...�
1/1/2015
guest Totally agree. There's an old saying I'm fond of: "Never argue with an idiot. They'll only bring you down to their level and beat you with experience."
One important thing to note - Peterson is not short TSLA. He is the former chairman and major shareholder in Axion Power (ticker AXPW), a research holding company in lead-acid battery technology for hybrid vehicles. (Talk about being on the wrong side of the technology curve.) He lashes out at anything that threatens his precious holdings, which are now worth about 10% of what they were 5 years ago. Ouch.�
1/1/2015
guest ...and they seem tot think they are NOT ARGUING! when clearly the only thing they do is argue
(not sure if JP falls in this category)
I have some acquaintances that are super negative about Tesla and always argue about other stuff and claim that they aren't arguing(no free rides for them ;> )
I can't argue that Tesla has their sh!t together from an engineering perspective. Some of the other 'less important' areas may be lacking a little. If I had anything to add to TSLA last week I would have but I think I need to put a down payment pretty soon :biggrin: doG dooG!
Just looking at the stock weekly prices as of right now, it looks like there is a $35ish plateau. I don't see this being the case in a few weeks or a month. There was no reaction to the S actually getting on the road on the first place because no one really even knows about it(my opinion? I'm not living in the Bay area anymore). I'd estimate that much less than 1% of people in my area have heard of Tesla. The only people that I know, that have heard of the S (out of approx. 300) are ones that I've told I was getting one(all of them!) NONE of them had ever heard of it. Some had heard of the Roadster and thought the company wasn't around anymore or something similar.
Tesla has huge room to grow...wait until it makes it to Norway and Europe and ...MArs }%P�
1/1/2015
guest We have stopped feeding him. I liked the comments which were largely "There you go again" as opposed to rational explanations or super fanboy cries.�
1/1/2015
guest I love how there is nothing in his Bio that talks about his rather huge interest in Axion, how he is a rather direct competitor with TM and then writes articles like these that pretend to be journalism but are nothing more than pure financially biased opinion. I would think "The Street" would put a stop to this.
John Petersen - Articles, E-Mail and Biography - TheStreet
�
1/1/2015
guest Discoducky, what if we get an online petition together, basically stating all of the facts about Mr. Petersons real agenda, then present it to SeekingAlpha and TheStreet, and we'll continue presenting it to any future online or printed media he happens to find to publish his drivel, we could actually be done with him�
1/1/2015
guest I'm in!
he is BS and trying to propagate lies for his own profit�
1/1/2015
guest A campaign of well formed, honest, level headed, fact based emails was effective at getting Peterson dropped from SeekingAlpha. Time to do the same with TheStreet, especially if anyone here is a subscriber to their premium services (like RealMoney).�
1/1/2015
guest I don't read any of those sources, but informing his publisher(s) of his conflict of interest sounds like a very good idea. At the very least, that conflict should be noted at the top of every article of his that they publish. (And don't forget to note our own interest as owners of Tesla's cars and stock.)�
1/1/2015
guest He's still on SA as far as I know. In fact a few days ago a comment stream where Nick Butcher and I picked apart some of his claims was deleted. SA seems to like having him around regardless of how wrong he is.�
1/1/2015
guest He brings traffic to the site. Us. Same with thestreet.com. We're the commodity.�
1/1/2015
guest So, the best thing to do is ignore him. Everyone with no agenda will get bored with him.�
1/1/2015
guest Tesla�s Musk Sidesteps 2012 Model S Sales Target
And the stock plunges below $30 on options Friday...�
1/1/2015
guest The comments on his posts should be in tis order:
1st. Low
2nd. Point out how he just trying to prop up his own investments
3rd. Point out flawed math/assumtions�
1/1/2015
guest Seems to catch itself 20 cents below $30... another buying opportunity...
Here is the video: Tesla's Model S Goal Is 20,000 in 2013, Musk Says: Video - Bloomberg
He says he "sidesteps" because as a public company, they can't disclose near-term information at this time. To me he seems very confident in general, though. Raising capital appears to be an option they look at, but not a necessity.�
1/1/2015
guest Here's an article comparing Elon's accomplishments with some Wall Street wizards, the last sentence is precious:
"They should sit down and shutup for a decade or three" love it
Dimon is No Musk, Wall Street is No Tesla: Street Whispers - TheStreet
"So, sure, let's encourage more Elon Musks to come to the U.S. and find ways to reduce our dependence on fossil fuels, fix our education system and cure diseases. But let's encourage Jamie Dimon, Mitt Romney and the other gladiators of Wall Street to shut up and sit down for a decade or three."�
1/1/2015
guest How much did Elon enjoy saying that his rocket is 100 times bigger than Branson's? :biggrin:
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He also seemed to basically admit they aren't going to hit 5K deliveries this year.�
1/1/2015
guest Like most of the other high volume low quality syndicates, unfortunately SA allows just about anyone to contribute, half the "authors" have never even taken a business/finance/investments 101 class. There is some valuable stuff written there but it is it few and far between, and easy to misinterpret.
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Later today Branson and Musk will be on Bloomberg measuring their uh, members.
More seriously though, does anyone recall or have a link regarding a new drivetrain deal for a big man. or something? I'm really surprised that they haven't filed for a cap raise yet and it makes me wonder if they have some other significant revenue from somewhere.�
1/1/2015
guest Drop to 27, climb to 31, drop to 27, climb to 31...�
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