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Stock fell despite production goals met

Stock fell despite production goals met

I think one reason the stock fell is CFRA equity downgraded Tesla on failure to meet delivery targets. But we know that Tesla is holding up deliveries to maximize federal tax credit. So, a BS downgrade. Stock should pick back up, IMO. Thoughts?

ReD eXiLe ms us | 2 juillet 2018

What do you mean by 'fell'...? TSLA opened $16.86 higher than it closed on Friday. Maybe some people chose to take profits. Currently at -$1.54 compared to the last close. Barely anything.

95dawg | 2 juillet 2018

Let's see...
A brokerage firm tells clients stock X is going to do well and advise them to buy.
Said brokerage firm upgrades stock X based on {whatever}.
Stock X jumps based on the upgrade news.
Said brokerage firm clients sell stock X for profit.
Repeat...

maintreqd | 2 juillet 2018

Yeah. Not everyone who owns $TSLA is playing it long. It's fun to buy on dips and sell on peaks, but I'm nervous more lately that the dips will be less frequent and the peaks will be much higher. I wasn't expecting this significant of a dip during today's trading hours, however. I really thought the news over the weekend would've driven it up to mid- or upper-300s. Maybe it will once the word is made official via the Q2 earnings call. Or maybe this stock will remain a wild card for a bit longer.

I do think long term it's going to rise significantly, but it would appear timing is still anyone's guess.

Magic 8 Ball | 2 juillet 2018

Those that try to time the market will happily tell you about their wins but remain silent about their losses.

ReD eXiLe ms us | 2 juillet 2018

TSLA
$342.95 ___ Closed, Friday June 29
$360.27 ___ Opened, Monday July 2
$335.07 ___ Closed, Monday July 2

This represents a difference of $7.88 in Closing amounts. How is that 2.30% difference a 'dip'? What is the likelihood TSLA closes higher than today's peak of $364.78 at some point within the next three months?

In other news, Ford (F) finished today up $0.03 (by 0.27%). If it had gone down by $7.88 that would have closed at $3.19 -- an amount that will have represented a loss of 78.25% of its value since Friday's close. Hmmm...

Oh, and Toyota (TM) finished down $0.88 today. A movement of -0.68% in all.

dgstan | 2 juillet 2018

Really, Red? You are going to compare actual stock prices? Are you deliberately trying to mislead?

phil | 2 juillet 2018

Stock fell despite production goals met "Submitted by mckmail2 on July 2, 2018"

Gee, if I didn't know any better this might almost have me thinking that life isn't always fair.

thomas.hitchcock | 2 juillet 2018

I was late to the game, but I am now a proud owner of 28 shares of TSLA. Was surprised of the activity today, but I am in it for the long haul (or until it spikes to $700 ;))

cascadiadesign | 2 juillet 2018

This is what bugs me. Tesla is the same company today Monday that it was Friday. But this idiot analyst chose today to try to pi** on Tesla's parade by recommending people sell. And his main reason was that even though 5,000 Model 3's were built last week, he doesn't think they can maintain that level of output.

greg | 2 juillet 2018

@cascadiadesign
"...he doesn't think they can maintain that level of output."

But he is true, because it will be 6K a week in short order, then 7.5K a week then 9K a week, then 10K a week.
None of which will be "5K a week".

So technically if he says "they can't maintain a 5K output" its true - they can't.
Model 3 customers demand it be higher :-)

dkabq | 2 juillet 2018

This could be just simply, the old wall street adage, "buy on the rumor and then sell on the news". particularly when the stock was up premarket this morning.

gballant4570 | 2 juillet 2018

Lots of things can affect a stock price, and they don't all follow apparent logic. There still are plenty of day traders out there, for example. One of the reasons my own investment strategy does not include buying individual stocks.....

jrlevy | 2 juillet 2018

The stock market uses a forward looking pricing model (this is one of the reasons Tesla has a market cap equivalent to that of GM even though they've never been profitable). One could make the argument that the production goal of 5,000 was baked into the current stock price already from Elon's reassurance at the shareholder meeting a month ago. Remember, the stock went up 10% that day for basically no reason other than a smooth sales pitch from him.

This may just be one of those profit-taking "sell the news"-type events. I expect the stock to go back to a more steady (but still volatile) pace in the $350 - $375 range until at least the earnings call.

M3NOICE | 3 juillet 2018

Bump

40milecommuter | 3 juillet 2018

buy on rumors sell on news

mos6507 | 3 juillet 2018

"it will be 6K a week in short order, then 7.5K a week then 9K a week"

Not if they only reached 5,000 by driving its workforce to burnout as the CNBC article portrays.

Keyword:
"A shouting Elon Musk and changing rules: Inside Tesla's Model 3 sprint"

Also, this quote doesn't bode well to their bottom-line:

[To make its number, Tesla was willing to "spend any kind of money," a Gigafactory worker said, pointing to the new battery assembly-line flown in from Europe via cargo planes to the Gigafactory in May.]

Tesla's back is breaking on the inviolable rule of Good, fast, cheap, pick two.

Magic 8 Ball | 3 juillet 2018

Sure we all have learned to believe stories from those anonymous Gigafactory workers. (rolleyes here).

KP in NPT | 3 juillet 2018

Just goes to show you - for the shorts and trolls it will NEVER BE ENOUGH.

carlk | 3 juillet 2018

It may be fun to watch but I never care about daily stock price changes. All I care is whether Tesla would be successful and become the dominate industry leader in a decade or so. I have a great confidence it can. The successful M3 ramp up, even that is delayed by its own very aggressive schedule, is just another evidence of it. No one else even has a plan of making 5000 EV per week in the foreseeable future. Traders can do anything they want to but it's the forest not the tree I am looking at.

bpaul | 3 juillet 2018

Not that we can ever really know, but I wonder if some fraction of the stock price decline is a result of people selling Tesla stock to buy Tesla M3s.

mos6507 | 3 juillet 2018

"for the shorts and trolls"

So there's no validity to the threat the workforce will burnout? Really? Have you worked under similar conditions? I have, quite recently actually. Burnout is a real thing.

mos6507 | 3 juillet 2018

BTW, no mention here yet about Doug Field's leave of absence now being permanent. So that's burnout for you right there.

wiboater4 | 3 juillet 2018

Since they hit the 5000 per week the new thing on the TSLA stock financial new is Oh they didn't deliver many cars in June. Duh 200,000 limit?

KP in NPT | 3 juillet 2018

Oh, and they "only" have 420K reservations - when they started with 455K and have delivered 40K plus cars.

:eyeroll:

jvcesare | 3 juillet 2018

There is an old adage: "Buy on rumor, sell on fact."

michael | 3 juillet 2018

Maybe the stock drop isn't entirely shorts - maybe the stock drop is the realization that there's a difference between hitting an arbitrary goal and sustaining one for the long term.

Shouting CEO, changing rules: inside Tesla's Model 3-building sprint
https://www.reuters.com/article/us-tesla-factory/shouting-ceo-changing-r...

kseehafer | 3 juillet 2018

Given today's volatility, I will say again that there are Wall Street elements that will always want to see Tesla fail, and will do whatever is necessary to see that happen. I've had my stock since it was in the 30's, (wish I'd bought more!) and I've seen these swings all the time. There is NOTHING that Musk or Tesla can do that will please the naysayers.

I didn't buy this stock to make money. I bought it because I believe in the mission of the company. That mission scares the big oil companies. We all know this. If you worry about these swings, you'll get whiplash.

jimglas | 3 juillet 2018

@michael
I switched my M3 order to a MX thinking it would be delivered sooner. 5 weeks and still no build due yet.

SO | 3 juillet 2018

People were saying they couldn’t sustain 2,000 a week just a few months ago.

So yes, the number produced will probably go down for a little bit but then will exceed 5k per week.

Let them freak out and drop the stock. I’m gearing up to buy more.

Madatgascar | 3 juillet 2018

I think Musk got a little ahead of himself, and basically told Wall Street he didn’t need them any more. Miffed, the analysts are going to prove that he can’t move the market as much as they can. So we are going to see this burst of analyst activity and credit rating downgrades that will probably keep up until Musk goes back to the markets with his hat in his hand.

Meanwhile, people are going to start seeing Model 3s everywhere, and with the Performance version, there will be fresh YouTube videos of a whole new generation of Tesla owners enjoying the hell out of their cars and putting the equivalent ICEs to shame. Cars will be available to test drive, the backlog will grow, the production capacity will grow, Tesla will become profitable at some point, and the long term picture will come into focus again.

JAD | 3 juillet 2018

It does kinda of seem like a last ditch effort to crush Tesla. They are quickly running out of time and all of a sudden a bunch of people are making random posts about weird issues that never come back, the spam attacks reached a new high, the FUD articles are everywhere and someone is selling a ton of stock to bring the price down. Doesn't add up to even normal Wall Street weirdness. Too much drop on too good of news (nearly 15% in 48 hours). Other factors are working here, but I am and always have been long term so these short swings are meaningless, especially given Tesla is not trying to raise capital for awhile.

CST | 3 juillet 2018

I'm glad to see this volatility as I'm looking to increase my position. However, I hope it is short-lived and we see it take off through the summer.

phil | 3 juillet 2018

JAD | July 3, 2018 "It does kinda of seem like a last ditch effort to crush Tesla. They are quickly running out of time and all of a sudden a bunch of people are making random posts about weird issues that never come back, the spam attacks reached a new high, the FUD articles are everywhere and someone is selling a ton of stock to bring the price down."

How would any of that "crush Tesla"? Stock price can go to a nickel, so long as Tesla begins generating adequate profit and cash flow before running out of money. Elon Musk swore up and down just a couple months ago that Tesla neither needs nor wants to raise capital. Why would any stock manipulation or FUD impact any of Tesla's operations?

Unless Elon was lying...

bjaminaltman | 3 juillet 2018

Unfortunately, or perhaps in some sense reassuring, Musk has seemed a bit 'unhinged' of late. 1) Analyst call from another planet. Very entertaining but more of a SNL skit nature. 2) "Short squeeze from hell" , "3 weeks to cover" tweets a bit of a call to war which in retrospect, I'd say that battle was lost. 3) Shouting at employees and creating image of labor camp atmosphere with forced overtime(?) not doing the Tesla image much good. 4) Buying a bunch of stock signaling some sort or confidence in execution, again wrong in retrospect although that is only short term. Why is this reassuring? Well, Musk once again proves he is at least part human and VERY eccentric. This fits with his persona and does not detract from his mission. Profitability is important, though not essential short term as long as growth, demand, technical/product innovation and margins are positive.

Should one question Musk's mental health at this point? Yes. It should always be questioned. He is from another planet. His girlfriend's videos reflect his persona well. Anyone see the CEO of GM dating Grimes? Ha. That's why I love Musk and this company. Unpredictable, creative thinking and risk with great things planned. Good luck to all on this crazy ride and enjoy your space vehicles!

Atoms | 3 juillet 2018

Seems like some attempts to help the short sellers going on. The downward pressure will not be sustainable against continued move towards profitability. Elon has more than 6 months of the same sleeping at the factory to pull this off. Too bad previous management did not have a handle on the ramp. They could not even communicate truthfully. Better to communicate bad news with a plan than good news with poor performance.

Magic 8 Ball | 3 juillet 2018

@bj writes: "Shouting at employees and creating image of labor camp atmosphere with forced overtime(?) not doing the Tesla image much good."

Do you have any names of these alleged employees?

I have to question the mental health of anyone who reads "information" coming from anonymous sources and then turns around and try to use that info. as fact.

Magic 8 Ball | 3 juillet 2018

The elephant in the room is Panasonic who is waiting in the wings with billions.

CST | 3 juillet 2018

Yep, that is a critical point. Once they step in, game over!

SO | 3 juillet 2018

@douwe - “Do you have any names of these alleged employees?”

Martin Tripp

dmm1240 | 3 juillet 2018

"I switched my M3 order to a MX thinking it would be delivered sooner. 5 weeks and still no build due yet."

I did the same thing last year. Five weeks is nothing to worry about. It takes around 6-8 weeks, generally, for your order to come up on the assembly line. Actually manufacturing it takes around 5-7 days to build, go through checkout, correct defects. The car will then be put outside in the lot and shipping will be arranged. Depending on where you live, that can take a couple of weeks, sometimes three.

You will hear nothing after your order is final until an email will be sent telling you your car is in production. You will then receive a 2nd email that notifies you that your MX has finished production and is ready to be shipped. Around this time the delivery specialist will contact you and give you a pretty definite date of when your car will arrive and be ready to pick up. You will also be asked to to check and make sure you have all your documentation ready (i.e. photo of your drivers license uploaded, proof of insurance certificate, arrangements for your trade in made if any).

All in all, it takes 2-3 months. It's the same with any manufacturer when you factory order a car. The upside is you will receive exactly the car you want with the options you want instead of whatever the dealer has on the lot.

Be warned: Your DS will not be available at your beck and call. You have one car to worry about. He has hundreds. One told me that he arrives at work every day to find 50 phone messages and 200 emails from soon to be owners.

Point two is you learn the railroads deliver on their own schedule, not yours or Tesla's. The car will arrive when it arrives. If it comes by rail, once it arrives at a shipping center, say Birmingham, AL, your car will be taken off the train and loaded onto a truck. The truck will then stop at a few Tesla delivery centers to offload cars for other customers. Finally, it will arrive and offload yours. Tesla will then take a day or so to check out and prep the MX.

Then you get your car. The delivery process can take as little as 30 minutes if you have your ducks in a row on documentation and aren't full of questions.

Finally, you drive it home with that Tesla grin that never goes away. It's over 10 months and I still have mine.

mos6507 | 3 juillet 2018

"That's why I love Musk and this company. Unpredictable"

The last few emperors of Rome were a little crazy too, Nero, Caligula, etc... and it didn't do them much good. And then there's Trump.

I'd think the movers and shakers that poured billions into Tesla would like to see the rational side of musk (cost-cutting, layoffs, improving internal processes) and less of the bluster and matyr-complex.

Labor camp is a nice analogy but I actually have visions of The Ten Commandments with whips cracking and slaves dragging blocks up ramps to build the monuments of Egypt and Yul Brynner saying "so let it be written [pregnant pause] so let it be done!".

bjaminaltman | 3 juillet 2018

Douwe, no idea if fact or fiction, fake news or reality. Does it matter? Is there going to be a purge of news reports with a redaction? Um, I think not. Maybe we can hunt down the traitors and interrogate the truth from them. As far as your concern about my mental health, it is horrible. I'm actually writing from my locked room with my supervising attendant looking over my posts in between medication and shocks.

Magic 8 Ball | 3 juillet 2018

bj, Best wishes.

I hope they can find a cure for you.

phil | 3 juillet 2018

bjaminaltman | July 3, 2018 "Anyone see the CEO of GM dating Grimes?"

Not that there's anything wrong with that...

phil | 3 juillet 2018

douwe | July 3, 2018 "Do you have any names of these alleged employees?"

Doug Field

Magic 8 Ball | 3 juillet 2018

@phil

Yes Doug has been on a leave of absence. What statements has he made. Leaving the company can be for many reasons. Do you know why he left?

dmm1240 | 3 juillet 2018

Know anything about Steve Jobs? Difficult man in real life. Driven, obsessive about detail, drove his employees mercilessly during Macintosh development phase, once told a prospective hire the material on the couch in his office looked better than the dress she was wearing, feuded with cofounder Wozniak for years, was so mercurial and obstinate that President Scully convinced the BOD to force Jobs out. Twelve years later, on the brink of bankruptcy after all that professional management, Apple's board brought Jobs back. Scully said in 2012 that jobs was the most effective CEO in America, he was too immature to recognize it in 1985.

Thomas Edison went down in American history as THE inventor. In real life, Edison was one nasty SOB. He mistreated his employees, demanded to take credit for everything. Nikolai Tesla is the one who came up with AC current making electricity through wires possible. Edison took all the credit and forced Tesla out of GE.

Henry Ford invented the modern assembly line. He provoked great outrage paying his factory workers the then unheard of salary of $5 a day reasoning someone had to be able to afford to buy the cars he made. Ford was savagely attacked by the business community of his day, just like Musk. Later, Ford notoriously said "they can have any color they want as long as it's black" when fledgling GM challenged him by offering cars of different colors compared to Ford's black Model Ts. In the lead up to WWII, Ford expressed admiration for Adolph Hitler. Ford made the history books for what he did. Name that first CEO of GM who decided to spiff up the paint shop without looking.

Albert Einstein, considered perhaps the smartest human ever, was notoriously difficult in person, infamous for mistreating his wife and being a misogynist in general.

Pablo Picaso, the most famous painter in the last century, was a womanizer, mistreating the women in his life his entire life.

Almost all innovators have a loose screw or two. It goes with the brilliance.

JAD | 3 juillet 2018

Musk has said Tesla will be profitable Q3 and Q4 and not need to raise money THIS year. They almost certainly will need it next year and if the stock is down to a nickel, no one will loan them money. Short term influences of the market are relatively easy, long term the stock seems to keep inching up as Tesla does the impossible again and again. Don't see that stopping any time soon despite random stories of misc pointless items that just sound bad today, but mean nothing for next year.

johnyi | 3 juillet 2018

dmm, the way you were rolling I was expecting you to name Trump in there too!

Phil is right, Wall Street can't impact Tesla's operations by driving the stock price down, at least until they need capital to expand again next year. But it can impact prospective buyer's perceptions that the company is "going bankrupt" and therefore hurt orders in Q3. Though with the backlog they have, they should be fine for several more quarters. And by then, assuming Tesla continues to ramp even if slower than predicted, and shows a profit, I can't see anything Wall Street can do to counter the evidence that Tesla is here to stay and totally dominating multiple markets.

If the stock gets to $270, I have fresh powder so it's just a buying opportunity for me!

ravisundaramam | 3 juillet 2018

@dmm1240 "Almost all innovators have a loose screw or two. It goes with the brilliance."

Ha! I still have hope. I am half way there. Got a couple of screws loose? Check! Got it down pat. Now need to work on the brilliance thing.