Tesla stock going down fast...and now back up equally fast

Tesla stock going down fast...and now back up equally fast

Down $14 this morning. Nervous!

Quick edit to the title to update for today's action.

Docrob | July 16, 2013

Any news out that we are unaware of thus far that could explain the drop?

rochec | July 16, 2013

I can't find anything.

cfOH | July 16, 2013

Tesla Motors Inc (TSLA) Overheat: Price Headed Toward $84 Says Goldman

And who said there's no such thing as a self-perpetuating prophecy...

Docrob | July 16, 2013

Yep, new Goldman Sachs analysis suggesting a long term range of $58 to $113 and a near term share value estimate of $84. To tell the truth the current share price is factoring in a pretty rosy run for Tesla for the next 5-10 years, $84 per share is still above the current book value of the shares and is probably a reasonable short to medium term target if Tesla run into any strategic business issues or competition in the EV sector increases. Time will tell.

AmpedRealtor | July 16, 2013

Obviously after the stock has run up so high there is going to be profit taking and a selloff at some point.

shop | July 16, 2013

And since when do growth stocks reflect anything close to book value? Goldman's report will be a blip, stock will recover, don't worry.

earlyretirement | July 16, 2013

Things seldom move in straight lines.

farzyness | July 16, 2013

This is a catalyst for short sellers. Let them come. Q2 earnings next week will squeeze them out. Again.

patrickclaerhout | July 16, 2013

Maybe the announcement by Elon Musk that he will publish his plans for Hyperloop by Aug 12 didn't help either.

Could spread the fear that the brain of Tesla Motors will lack focus in the future and that Tesla may become an orphan

Maybe not everybody has trust in the commitment of Musk towards Tesla.

Just my 2 eurocents

earlyretirement | July 16, 2013

Also, remember this week is options expirations which always adds increased volatility.

fuellss | July 16, 2013

Our stock in Tesla,(up or down) will not affect the quality of our life or lifestyle. I try not to stress out over matters which I have no control over. I'm not nervous..

AmpedRealtor | July 16, 2013

I bought Apple at $40 and before it split... twice. It went to $700, now it's$425. I forgot about my stock shortly after I bought it. That's the only reason I made money, otherwise panic would have set in a long time ago. Ride the wave. This company is only getting started, lots of potential out there. Stock value is based more on your potential for growth, and Tesla has a ton.

NomoDinos | July 16, 2013

I'm nervous, too... that I can't sell off what's left of my Apple fast enough to make sure I pick up more TSLA at this price :)

AmpedRealtor | July 16, 2013

Could this decline have to do with earnings expectations coming up?

NomoDinos | July 16, 2013

Possibly, most expect some decline in Q2, but this has been known for a while. I think @earlyretirement is right.

mjs | July 16, 2013

Bought @$116 :)

Blvr888 | July 16, 2013

The whole bunch of GS calls is due on July 19 in the range $95-125.

justineet | July 16, 2013

The stock will go thru up and down moments like all growing companies..the most important point is the long term prospect of the company. Tesla is a $200-$300/share company within 6yrs in my opinion. This fact will be clear to everyone in about 2-3yrs. By then it will be probably too late to buy Tesla stocks for considerable gain. Oh, Goldman Sachs, don't forget they are fallible like all brokerage firms. It was not long ago Goldman Sachs and other brokerage firms were telling investors to invest in bad securities which caused the recent financial crisis and implosion of world economy. In general "analysts" have difficulty properly assessing frontier companies that are involved in cutting edge technologies. Unlike with their assessments of traditional companies, they either significantly undervalue or value them. These guys never saw the Amazons, the Intels, the Facebooks coming.......

Atlantis | July 16, 2013

There is no news.
A little earlier, rumors started that TSLA will join NASDAQ-100, and this was confirmed Thursday evening (July 11th) or Friday morning I'm not sure.

The significance is that ETF's, ETN's and other investment funds that follow the NASDAQ as a benchmark are required to buy up TSLA which will increase its price. By how much? No body knows beforehand, but in anticipation of price increase market-makers buy it to then sell it to these funds and profit.

As rumors started, TSLA trended from June 24th through July 15th going from $100 to $130.
TSLA was effectively added on Monday and it turned out those funds didn't need that much TSLA or had already bought their need so all those market-makers who were looking for fast money had to dump their extra on Tuesday July 16th.

So the over-reaction to the NASDAQ-100 event is correcting itself. Odds are, the stock is now under-shooting. If I had extra cash sitting around, I'd happily buy some at $110.

Nevertheless, as others said, only buy TSLA with the intention of keeping it for years.

jonlivesay | July 16, 2013

Stock is over valued. Still nice idea to buy in if you believe in the company, shouldn't be a short term money maker if you own one of these super automobiles. There will be violent up and down swings, just don't look .

martijn | July 16, 2013

Is this mostly taking profit, or are the shorters busy again?
Does somebody know where to see the short-ratio (change)?

moorelin | July 16, 2013

@mjs - also in at $116

jonesxander | July 16, 2013

@martin, sometimes it's hard to come up with recent numbers. I believe they only really update twice a month.

I used to rely on Yahoo, but realized this one updates much faster:

As you can see only a bi monthly update is happening on the 15th and end of month. It's probably a huge accounting nightmare (i'm not too knowledgeable about shorting/options, etc), thus the numbers only coalesce at this interval.

larmorfreq | July 16, 2013

my opinion: GS is bitter that TM actually makes a product. The product has orders, sales, and delivery of product. TM has removed govt debt obligation. For reference, c/w other tech companies which provide a service. GS wants to buy in low, prior to Q2, which everyone wants to know unit production and sales...

just my 0.02

tobi_ger | July 16, 2013

GS = Gutman Sucks?

Atlantis | July 16, 2013

The stock past 110 July 1st, and is back below it now ($109.22 as I write)
I don't think this is taking profit, or short-selling (although don't believe real-time short-ratio is available anywhere).

This is just accepting the loss and moving on for those who bought after the NASDAQ-100 rumors started.

Expect aftershocks for the rest of the week, and then calm performance afterwards.

cfOH | July 16, 2013

GS = Gluttonous Shorts

jonesxander | July 16, 2013

My only advice is don't try and time it. Buy it and hold if you're going to.

I'm watching the stream, good news is there's lots of people buying tsla.

Every time it hits a new low, more people are buying it, and it rebounds a bit. Then it dwindles and goes down even lower, and more buyers come in.

This is a good sign I think, considering.

Also, I've noticed this stock has a lot of action on any buy/hold/sell upgrades/downgrades.

(forgive me for my estimates below, of course memory isn't 100%)
For instance, before the short squeeze, one firm said price target $73, well magically during the squeeze, it sat at this number for a bit.

Then someone else said $103. Well guess what? It peaked at $103, and went back down, then jumped again.

Then someone more recently said $130. I think we're starting to see a trend. I'm actually kind of hoping it goes down to $70 - $83 so I can buy some more.

Shesmyne2 | July 16, 2013

As we in the financial industry refer to them;
"Goldmine Sachs"
"Goldman Suchs"

Buying opportunity!

Still grinning;-)

RedShift | July 16, 2013

Finally, I can get in on another position. Thanks, Goldman.

jonesxander | July 16, 2013

@Red Shift and Shesmyne2

+1 +1

jonesxander | July 16, 2013

Oh yeah, another thing, notice this is bringing down the entire index? lol

Not by much but it is down today, probably because of TSLA

Jamon | July 16, 2013

Today has been a fun buying opportunity for call options! These steep, quick corrections have been great buying opportunities. There has been no significant change in Tesla's fundamentals to warrant this drop in price. It will be back up soon, and I'm holding my shares until the day Elon is no longer in control of the company.

AmpedRealtor | July 16, 2013

I don't quite understand how you guys keep saying the shares are going to go back up. A 4x run-up in stock value in just as many months is an unsustainable bubble that was bound for a major correction. How can you expect that kind of forward momentum to continue unabated? I am not a stock trader, but it seems a little "out there" to expect this stock to bounce back to a level that was unsustainable to begin with.

I expect this stock to continue declining until it reaches a level that better reflects the company's near-term prospects. Of course, the stock market always does the opposite of what I think or say, so my saying this here today is going to make the stock go up. BUY! LOL

eAdopter | July 16, 2013

I expected something like this. I've owned several stocks as they were added to major indexes and the result was almost always similar. TSLA is now part of the NASDAQ-100 and will be exposed to new market pressures. Going forward I expect much slower price appreciation, possibly for many years. I think both shorts and longs will probably suffer.

juventas79 | July 16, 2013

buy buy buy its going back up!

GReese | July 16, 2013

A little healthy skepticism from the market is a good thing. The article makes valid points. Nothing negative, just some reality-based numbers based on the SUCCESS of Tesla.

drax7 | July 16, 2013

There is no way of valuing tesla right now. It's a very dynamic situation, with potential for explosive
Growth. These are the same geniuses that prevented me from buying Netflix .

AmpedRealtor | July 16, 2013

Looks like TSLA is hovering around $108. Personally I do hope the value comes back down to reality so that I can buy into some shares.

justineet | July 16, 2013

@AmpedRealtor....unlike some, lots of us are looking at the longer prospect. If u r the jittery type don't buy into growth stocks especially in the tech sector....growth stocks tend to be up and down until book value catches up in the long term with stock price.

rchiang | July 16, 2013

I think it will go back up its just need to go down again to have the thrust you will see.

justineet | July 16, 2013

About Health Skeptic Analysts.....they r usually good but not when it comes to pioneer, frontier companies most of the time. They usually miss when it comes to breakthrough companies like Apple and Amazon. Their measuring stick is usually traditional growth which is not good fit when it comes to breakthrough, disruptive newcomers.......

Tesla4JP | July 16, 2013

This thread is great! All these cool headed, smart remarks. No one in a panic. I completely agree with almost all comments.
-Oppotunity to buy
- Market correcting
- I'm in it for the long haul, when Elon leaves, I'll consider selling.

I would still love to hear that a dozen Model S & Roadster owners organized and parked in front of GS to give all the executives a ride.

Like that CEO asked at Teslive...."we are a resource for you, what can
we do?". Elon said. Spread the word!

Still Grinning.

farzyness | July 16, 2013

Sorry, correction for my previous comment. Tesla earnings on 8/7/2013 per Tesla Investors Website.

Some Predictions if I may:

Tesla will post a profit WITHOUT EV credits yielding about 7 cents a share (which will beat analysts prediction of a loss at about -10 cents a share).
Produced 5400 cars in Q2.
Sold 4800 cars in Q2.
Runrate of 550 cars per week based on June average.
Projected to sell 23k cars 2013.
23% GM.
European and Asian market demand strong and rising.

carlk | July 16, 2013

@Blvr888 "The whole bunch of GS calls is due on July 19 in the range $95-125."

Good reason. People need to know those "analysts" get paid for making the stocks move in the direction they want. We who plan to hold the stocks for long term need not to worry about the short term variations.

AmpedRealtor | July 16, 2013

@ farzyness, on what do you base your prediction that Tesla will yield a profit of 7¢ per share? Market consensus appears to be at a 7-8¢ per share LOSS. What flavor is your Kool Aid? :)

Jamon | July 16, 2013

I believe the Kool Aid flavor is Teslon :)
Once you drink it, there's no going back!

AmpedRealtor | July 16, 2013


jonesxander | July 16, 2013

Hey when the last earning report, I correctly guess $0.12 a share. There's nothing wrong with just wild guesses :)

farzyness | July 16, 2013

@AmpedRealtor the flavor is definitely Teslon :P

Jerome at Teslive dropped a pretty decent hint that they are selling out of all their loaners, which are obviously the cars with the most GM padded into the price due to up-options. In addition, with all the VINs that have been delivered, I think they have shipped more cars than they have guided for the quarter, in addition to further operation efficiencies. The higher gross margin per car and the additional cars sold from guidance is where I come up with the 7 cents a share profit. Also a little bit of guessing :D