Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Taking Tesla Private

tesla.com

Post reply on HN
Print view View original

281–290 of 290 posts

Re: Taking Tesla Private

#281

Post by ChicagoDave »

nopriorarrests wrote: post #235
gonehome wrote: post #205

Earlier quoted context omitted.

Shorting is fine when you're predicting the stock will go down, it starts leaning towards evil when you try and damage the company to cause the price to go down. Billions on the line create a nasty incentive and a publicly traded company is more at risk of negative attacks when they're not yet profitable.

There is zero evidence of shorts trying to damage the company. Every time when TSLA stock was down last year it was some material news regarding missing Model 3 production estimates previously provided by Elon Musk himself or something like that.

Not quite true...

https://electrek.co/2018/07/24/tesla-troll-short-doxxed-oil-...

Re: Taking Tesla Private

#282

Post by ChicagoDave »

karpodiem wrote: post #275
ChicagoDave wrote: post #131

Earlier quoted context omitted.

Oh I wouldn't discount Elon's interest in screwing the short-sellers. There's ample evidence of his disdain for these people and even if you're bearish on Tesla, I think a lot of the short-sellers are fueled by oil & gas interests, so Elon's ire is not unwarranted. I don't think the media portrays this battle appropriately. Tesla is the #1 enemy of the combustion engine supply chain and that is no small thing. Every…

I'm not fueled by oil and gas interests - I know a fraud when I see one. I'm short the equity, since dividends aren't a concern. Tesla cannot manufacture at scale - they do not have the experience or capital to execute on this. Their financial statements demonstrate as much, and the build quality/reliability issues that are prevalent on forums/reddit/twitter demonstrate this.

Jeff Bezos was a fraud for a number of years too.

If Musk gets the funding to go private, gets the 2-4 years of runway he needs to make the business work, that's a good thing.

I'm not a fan of businesses that run red year after year, but in some cases, there are societal benefits that vastly outweigh those concerns. A successful mass-production battery and EV business is something that can have a massive impact on reducing CO2 emissions.

So a lot of people and investors are less concerned about making money and financial models than they are about moving from fossil fuels to renewables. And if Tesla gets a few more years, the profits will come.

If you're only concerned with the bottom line, why are you investing in or against a startup? That seems like gambling to me and if you lose, that's on you, not on Tesla.

Re: Taking Tesla Private

#283

Post by 11thEarlOfMar »

peeters wrote: post #277
11thEarlOfMar wrote: post #176

Earlier quoted context omitted.

Google has three classes of shares: A, B and C. A shares get one vote, C shares get none and B shares get 10 votes. Brin, Page, Schmidt own all the B shares. [1] For FB, Zuck holds a class of shares where each of his counts as 10 vs. the common shares.[2] [1] https://www.investopedia.com/articles/markets/052215/goog-or... [2] https://www.cnbc.com/2018/03/20/shareholders-wont-force-zuck...

Hmm, interesting. I thought we were just talking about voting shares. Musk has said current shareholders would be able to hold on to their shares. Do you think behind that statement he implied "but will lose voting status"?

Lose or reduce. Musk would be at much greater risk as CEO if there were a small number of large shareholders. They could, in theory, band together against him to make a change. So I'd expect that as part of the deal, he'd make arrangements via voting rights to be in control. So your current 1 vote public shares may become 0 vote private shares. Or, his private shares may carry 10 votes each.

On the other hand... he seems to be somewhat an idealist and may reason that his performance will stand on its own merits. I.e., the shareholders would be right oust him if they felt that was the right course of action. Will be interesting to see how this plays out.

Re: Taking Tesla Private

#284

Post by pooya13 »

peeters wrote: post #93
take4 wrote: post #75

Earlier quoted context omitted.

> CNBC reports that none of the Wall Street banks it contacted were aware of any transaction or had committed to funding a leveraged buyout of Tesla.

So there's the real story. Who is this financer (or group) with ~40 billion in capital that is willing to bet long on Tesla? That's really interesting to me, if Musk is being truthful here.

Fidelity or Google comes to mind. I think at some point they were having discussions with Google but then the company overcame the difficult conditions so they halted the talks: https://www.theguardian.com/technology/2015/apr/21/google-al...

Re: Taking Tesla Private

#285

Post by majewsky »

Tomte wrote: post #258
majewsky wrote: post #242

Earlier quoted context omitted.

Correct. Also a large part of the reason why we still don't have universal speed limits on Autobahnen.

That‘s simply wrong. We don‘t have a speed limit because the majority of the people would hate that. On the other hand, German carmakers have a longstanding gentleman‘s agreement to electronically limit their cars to 250 km/h. Seems they can live with limits.

> We don‘t have a speed limit because the majority of the people would hate that.

That prompted me to look for polls.

> (2015-10-15) 56% of those polled would support a speed limit of 150 km/h on all German Autobahnen

Representative survey by YouGov, source: http://www.faz.net/aktuell/politik/inland/umfrage-mehrheit-d...

> (2018-01-26) A slim majority of Germans (52%) supports a general speed limit of 130 km/h.

Representative survey by Forsa, source: https://www.tz.de/auto/tempolimit-autobahn-knappe-mehrheit-d...

> (date unclear) "Are you for or against a general speed limit of 120 km/h?" - 35% for, 62% against

Source: https://de.statista.com/statistik/daten/studie/258757/umfrag... (they won't disclose source, survey method or date unless you cough up your personal data)

So it appears that a speed limit would be supported by the majority if it starts out reasonably high. (That's the same way the Swiss did it: They started with a relatively high speed limit, and then lowered it as the majority mindset shifted towards higher energy efficiency.)

Re: Taking Tesla Private

#287

Post by flush »

apexalpha wrote: post #268
derriz wrote: post #211

Not directly related to the thread, but I'm surpised by the extreme anti-short seller sentiment? Why is it important that they suffer? Short-selling is what makes almost zero expense mutual/index funds available to mom n' pop investors. Fidelity are about to offer ZERO TER funds on the basis that short-sellers pay heavily to borrow stock from them. It seems analogous to expressing hatred for umbrella sellers because…

What real world value do short sellers add? Owning a stock used to mean that you invested in (a part) of a company. You risk your money to get some of the real world gains the company hopefully makes. Now, the stock is the product, not the company. It's become a game in itself. It adds nothing to the real world outside of finance.

What real world value to long buyers add? Sure, if you invest and the company takes that investment and does really well with it, the world may benefit from an increase in productivity/wealth. But if you invest and the company does poorly and tanks, then the world loses by something because you could have taken that money somewhere productive. The kind of market that produces the most real world value is one where companies are valued accurately. If you think a stock is undervalued, you go long. If you think it's overvalued, you go short. Both actions affect the market value of a stock.

Seems like two sides of the same coin. I can't see where an argument against one doesn't work against the other.

Re: Taking Tesla Private

#288

Post by pmart123 »

apexalpha wrote: post #268
derriz wrote: post #211

Not directly related to the thread, but I'm surpised by the extreme anti-short seller sentiment? Why is it important that they suffer? Short-selling is what makes almost zero expense mutual/index funds available to mom n' pop investors. Fidelity are about to offer ZERO TER funds on the basis that short-sellers pay heavily to borrow stock from them. It seems analogous to expressing hatred for umbrella sellers because…

What real world value do short sellers add? Owning a stock used to mean that you invested in (a part) of a company. You risk your money to get some of the real world gains the company hopefully makes. Now, the stock is the product, not the company. It's become a game in itself. It adds nothing to the real world outside of finance.

Honesty.

For instance, investors can't short in India, and it happens to be one of the countries with a reputation of a high proportion of companies with accounting irregularities.

Re: Taking Tesla Private

#289

Post by pmart123 »

spadros wrote: post #243
spadros wrote: post #241

Earlier quoted context omitted.

I think people here aren't saying they hate shorting in general, but that Musk hates people shorting his company. So it's Musk enjoying twisting the knife in the shorters, not these guys on Hacker News.

Also if you're a long term investor you probably hate shorters and traders.

I think it depends. I think long-term investors should still look at short interest and read short thesis to understand counter-arguments. Regarding manipulation and herding, I think it depends. Someone could short Apple on merits of valuation. In this instance, due to the company's strong balance sheet, its a matter of debate and opinion among longs/shorts as a short report will not death spiral the company. In situations where a company has a significant among of debt or a cash flow issue or is a financial company, the company generally has to access capital markets at some point in the near future. This is the danger of leverage, or even proving a business model as a public company.

In the middle ground, you have a company like NFLX where some investors like Bill Nygren are long and advocate the position due to his belief the company has room to raise prices in the future from say $12/month to $15/month, shifting the PE ratio from 150 to 20. My assumption would be that a short thesis would have much less impact on scaring the market to instigate a death spiral for NFLX.

So with Telsa, it is in a vulnerable position due to being in a highly capital-intensive business, negative cash flow, and significant liabilities. But, it also is the only car company ever to presell hundreds of thousands of cars and a CEO who has delivered on big visions and promises before.

I have no personal investment in Tesla, but I hope Elon succeeds as I appreciate his ambition.

Re: Taking Tesla Private

#290

Post by randomsearch »

peeters wrote: post #35

The main question I have is about financing. If Elon owns 20% of the company now, and he doesn't intend for that to change, and he is giving the option of public shareholders to sell at $420, then who is financing this? Usually a private takeover requires a partnership with a huge private equity firm. Wouldn't releasing this without having (or identifying) that partner be premature? And wouldn't the resulting stabili…

Google (directly or indirectly) makes a lot of sense. They have the best self driving tech. Elon is miles ahead in electric vehicles. Perfect combination.
Post reply on HN