Tesla as an opportunity of investment

Tesla as an opportunity of investment

I belive that all people that are reading this post think that Tesla is a great Car Company, the most advanced, the most innoative and the most oriented at the future.
This is the reason for which I'm evaluating tesla as an opportunity of investment and i would like to discuss with you about this.

danielccc | April 18, 2013

Bubba, that sounds pretty reasonable for the major hedge funds and their firepower. But I think there actually is some pressure from the "mom and pop" shorts. We've been talking about the shorts for a long time. They are really taking a bath now. Some of them have to be heading for the exits.

Notice that the stock is solid regardless of what the market does. The S&P is down 3% so far this week, while TSLA rose to 47.

I find it hard to believe that only longs are driving up the stock even on a sharply down week like this.

Bubba2000 | April 18, 2013

A lot of bad news has been priced into the stock. Bloomberg bad mouths Tesla. Many of the analysts do not think Tesla is viable. A lot of shorts piled in. I was offered 18-20%/year to loan my shares a month ago! That is a lot. Meanwhile, the consumer is voting with their wallet and Tesla is selling all the cars it can make, hi end cars mostly.

Shorts still want to short the stock, in spite of the goods news. This week the offer was in the 14-15%/year to borrow shares. There is still skepticism that Tesla will generate positive GAAP earning and positive cash flow. I think they will exceed their guidance due to the inherent economies of scale in automated manufacturing and efficiencies of their supply chain.

Elon Musk and his team are very competent. Look at his track record. Would you bet with:

or this Bimbo:

danielccc | April 19, 2013


I am far from an expert, but it looks like panic, or forced, buying to me.

Tiebreaker | April 19, 2013

This is exciting to watch:

+2.52 (5.36%)
Real-time: 12:54PM EDT

David M. | April 19, 2013

I suspect we will peak at $50 today 4/19/13. From here, it would take too much of a retreat for the shorts to cover. Nothing but good news for Tesla over the next 60 - 90 days. Bravo!

I sincerely hope that many of the Tesla employees are reaping the financial benefits of the dramatic increase in stock price. They deserve it for all their hard work.

Bubba2000 | April 19, 2013

Sadly, it looks like the shorts are throwing the towel. There is no interest on the part of the shorts to borrow any shares to short. They went from paying 18-20%/year about a month ago to not wanting shares anymore. WAAAH!

Daily volume have been slightly up, but not enough to cover the 31.3M shares short as of 3-28. I suspect the big institutions that are short must have done private purchases in big blocks. Fido is long big time with 15% of the shares outstanding. Quite a few of insiders have been selling during the last few months including Elon Musk, Mrs Musk #1 (Wife #2 must not have got many shares), plus a few other insiders. This must have given the shorts breathing room.

Those shorts provided a nice support to the stock.

Brian H | April 19, 2013

Didn't most of the shorts lock in in the low $30s? That's hot bath time.

TeslaRocks | April 20, 2013

If the short has been forced down a bit by this rise, I wonder how fast they would jump back in (short, that is) in the event of a bad news. Whatever is happening, mini short squeeze or not, I just look forward for the stock to come back down a bit within the next few years so I can buy in. I've only shorted some puts at $15 due next January, so naturally this leaves me hungry for more because that was just a teaser.

TeslaRocks | April 20, 2013

I meant "If the short [interest] has been forced down a bit by this rise"... sorry.

Brian H | April 21, 2013

Trying to pick bottoms and tops is the road to ruin.

Tesla Lover | April 22, 2013

Another obstacle overcome: 50$

One publication theorizes that we’ll see a massive short squeeze when investors who bet against Tesla Motors Inc (NASDAQ:TSLA) realize their mistake. The stock rose another 4+ percent on Monday in anticipation of CEO Elon Musk’s big news about the company.

Nantang | April 22, 2013

You guys have been great for me! My next car will be a Tesla, but I'm already getting the benefits in my 401k. I got in about a month after the IPO, when stock was around $25 a share, investing about $2k. It's now double! I added another $1000 a few weeks ago. I did this for the same reason I did my initial investment: the confidence that for the long term, electric vehicles will be the way to go, and Tesla is way ahead of everyone else in the business. I just didn't expect the payoff to be so quick. Shortly after the second purchase, the stock ratcheted up from about $40 to $50 a share, so I'm coming out ahead. If I were playing the market, I might cash out while I'm ahead on the short term. But, I stand by my belief that this is a long term company with a plan that sees the future better than everyone else. So, while I'm saving up for a Tesla, Tesla is saving up for me.

Tesla Lover | April 23, 2013

Respect for nantang :)

I hope that all this wave of optimism will turn into benefits for the company, and obviously, for the stock market...

Brian H | April 23, 2013

I have you up about 93% overall so far. Not tea bags!

Tesla Lover | April 23, 2013

... and i said to myself:

....what a wonderful stock.....

TSLAholic | April 24, 2013

I am ready to go long on TSLA, however I'm debating as to when exactly to get in. Some say since the stock is currently overpriced, it will come back down closer to its market price after the short squeeze. Others are not so sure, claiming it may not get lower than its current price even after the "tsunami of hurt" has passed.
What's everyone's thoughts on riding the wave and cashing out during a possible major peak just to go back in once the price settles?

Bubba2000 | April 24, 2013

Tesla short interest dropped from 31.3M on 3-28 to 30.7M on 4-15, a drop of 0.6M (2%) only. The stock in the same period went from 98 to 44 approximately or moderate elevation of volume. It must have been the longs buying. I would guess the same happened last week, so current short short interest must be around 30M or about 45% of the available float.

This provides some support for the stock. If we get good news flow, including SC deployment, reservation numbers and most important, a beat in earnings, margins, etc... then the shorts would be pressured to cover. If the long pile in, it could be interesting.

Brian H | April 24, 2013

Maybe Elon should start wearing body armor.

TSLAholic | April 25, 2013

Speaking of earnings, has anyone read John Petersen's article "Tesla's Q1 Earnings, An Epic April Fools Prank"?

Brian H | April 25, 2013

What happened at noon that kicked the stock upstairs?

DarrellH | April 26, 2013

TSLAholic, as soon as you mention "John Petersen," most of us know the article will be a complete waste of time. No need to read.

TSLAholic | April 26, 2013

I figured there was a good chance his name would be well known around here. Thanks!
So back to my original question. Is it possible that after the short squeeze (if one occurs at all), the stock price may drop to the 30s, making it a better buy even if going long?
Also, say the squeeze occurs, what time frame are we looking at for the price to drop? Minutes, hours, days? Any opinions?

Tesla Lover | April 29, 2013

Somebody know the isin code of some tesla options ( obviously i'm talking about the call...) ?

54 $ the highest peak ever and is trying to break the 55 resistance, think is possible see 60 $ before the release of the Q1 results ?

TeslaRocks | April 29, 2013

Short squeeze happening now? I imagine some people are getting nervous that maybe earnings will be better than expected or something, or realizing that shorting Tesla, especially since the launch of the model S, is a really foolish idea. It could be all crazy between now and May 8, but I expect from these levels that there will be a pullback after the earnings release, because I doubt news are really that good to justify a doubling of the stock in a few months.

danielccc | April 29, 2013

I don't think this is "the squeeze". A true squeeze is when margin calls on more leveraged shorts trigger a rise in price that causes margin calls on the next most leveraged shorts and so on. It's like a chain reaction.

As far as I can figure, it would play out in a few hours, not minutes. Even at 7X the average volume, you need a full trading day. To do it in minutes you'd need like 100X the volume. Watch the volume.

Some shorts are getting out ahead of it, and others are covering with calls. I'd also note that some longs with large positions have an incentive to try to trigger the squeeze. I don't know if this is feasible, but if it is, they will try.

It would be fun to watch, but don't forget it might not happen at all.

Curiously, Solar City is mirroring Tesla. It was up 7.7% today, for unrelated reasons. The Stark Industries Elon Musk ETF is flying...

jk2014 | April 29, 2013

Timing with the supercharger announcement leading into a surprise Q1 conference call announcement could push over 60 and trigger the tsunami of hurt on shorts. Would be interesting to see it peak north of 80. And see where it lands, hopefully above 50.

Brian H | May 2, 2013

Since the start of '13, TSLA is up about 75%. If that continued the rest of the year, it would be up 420% (compounded growth).

RNB | May 2, 2013

Time to up the ante (and fix some mistakes). Tesla announcement tomorrow

BQuinn | May 2, 2013

@RNB, is the 300,000 low?

Bubba2000 | May 2, 2013

300k is just 1% of the shares short. All it will take is some one or more major holders to call their shares and there would be squeeze. I think most shorts are in denial. They are mostly bean counters looking at financials. I doubt many have driven MS or toured the factory. Let alone understand the EMF principles of induction motors or variable frequency inverters.

I think the street is used to seeing so many BEV companies go belly up. They figure it is a sure bet shorting TSLA. Fisker, A123, Coda, etc. So they they all piled in short on TSLA and are willing to pay 20+% to borrow the shares.

Look at Elon Musk track record: Zip2, Ebay, SpaceX. Even SCTY is rocking... went from $9 after IPO to 28 peak!

Brian H | May 2, 2013

Yep; to make best use of rules, it's necessary to recognize what constitutes a valid exception to them.

jk2014 | May 2, 2013

Wouldn't that be genius if they were able to time a follow on offering exactly when the short squeeze happens? Set the price at 200?

danielccc | May 2, 2013

@jk2014, you can't do that. The offering has underwriters and must follow SEC rules to insure transparency.

It's good enough that they did the last one at $28 and could do the next one at $54, which seems to be a new support. More money, less dilution.

Tesla Lover | May 6, 2013

Any comment about this + 9 % ??

today there is the release of the q1 results.

holidayday | May 6, 2013

The last hour seems to have been a response to hire a VP of Vehicle Engineering away from Aston Martin.

Very good pedigree there.

Hi_Tech | May 7, 2013

Heavy volume today today... with price taking a hit (down 6% right now to about $56). Thoughts?

Bubba2000 | May 7, 2013

It is anybody's guess what Tesla will report tomorrow and what the market reacting is going to be. However, when I look at the prospects in the short term, the big driver for demand has to be an ubiquitous Supercharger network in the highways... probably 200+ SCs costing $50M. This would drive demand from early adopters to the hi end mainstream. Instead of selling 25,000 MS, they could produce and sell 50,000 MS with 2 shifts.

In addition, the demand for MX should match MS, especially with a SC network. Look at the Porsche sales and product mix:

Of the 143k Porsches sold, 83k were SUV Cayennes! Tesla could sell a measly 50,000 MX SUVs. Total sales in 3 years could reach 100k autos. At ASP=$90k, that is $9B. Gross margins should reach 30% with economies of scale, unless Tesla cuts prices to drive demand even further. Gross profit should be $2.25B to $2.7B. Make is $2.5B. If SG&A, R&D are $500M, then net profit before taxes are $2.5B. Tax rate of 40% and the net is $1.5B.

If the company is perceived as a fast grower, disruptive, etc, what kind of PE for a fast grower? 20? That is a market cap of $30B. Even with dilution, the stock price could hit $200/s before the competition wakes up. Always, got to have an exit strategy.

Just a scenario.

RNB | May 7, 2013

Intereactive Brokers has no shares left to short, down from the 300K when I posted the link, and down from the 60K I saw earlier this am. Lots can happen Wednesday, pain points likely to be tested either way. If you are new to investing be prepared to be tested. I am not playing the squeeze or the fall, I am an investor thinking of 10-20 years.

It is tough to rationalize things.

Cattledog | May 7, 2013

Bubba2 - Through similar logic, and Porsche as the most likely comparison (high end, limited models, rabid following, high margins) I figured Tesla worth $200/share. It's a question when the market believes that value. 2-5 years I think.

Brian H | May 7, 2013

This is not the SC announcement. Earnings news only. According to Elon.

RNB | May 8, 2013
Tesla Lover | May 8, 2013

Tesla First quarter result smash the expectations, in this moment i see + 19% in the after hours market, Probably this is the turning point for tesla, and i'm really glad that i invested in this company before all this results.
Looking at the future of the stock 100 $ are not so far now...
I'm seriously evaluating of buy more...

Brian H | May 8, 2013

I now see 25%+, breaking $70 after-market. 4X IPO price, just as a reminder.

gary.greene | May 8, 2013

I bought additional shares today prior to the announcement, anticipating the positive numbers and wham! Looks like I made a good decision. Let's see if things settle down in a few days or continue to rocket higher. Positive upcoming events include Consumer Reports review "best vehicle we've ever tested" and further announcements from Elon. Great days hopefully ahead.

eDave | May 8, 2013

TSLA is firing on "ALL CYLINDERS" !!!!!! (get the irony there??)
Great Quarter & great outlook!!!!
All you SHORTS... prepared for the tsunami of HURT!
Way to go TSLA!!!

Tesla Lover | May 8, 2013

I hope that all the shorts have been enough smart to close their position time ago, if not, Take this !

Curt Renz | May 8, 2013

It can only become a true short squeeze, if shareholders are unwilling to sell, thus preventing the shorts from covering their positions at reasonable prices. If the longs stand pat, the sky's the limit. An owner may want to think twice about selling this week or even next week. Perhaps not for years, as TSLA is a once in a generation shooting star.

Tesla Lover | May 9, 2013

Any information about the q1 reservation ?

Tesla Lover | May 11, 2013

Short squeezing is in full execution... do you think is possible a flexion of the stock now ?