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Tesla Smashes Earnings And Revenue Expectations

businessinsider.com

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Re: Tesla Smashes Earnings And Revenue Expectations

#181

Post by mfringel »

anateus wrote: post #29

The last several months in Silicon Valley I do not remember the last time I went outside for more than 5 minutes and not seen a Tesla. I noticed about a week ago I stopped caring, much as I do not especially remark on noticing a Honda or a Ford. That's a good sign, though likely very geographically localized.

I've seen a grand total of one of them in the Boston area (Somerville, to be precise), but Boston has never really been a big place for supercars... this is for two reasons:

1) General New England frugality.

2a) New England winters eat cars due to the salt and potholes.

2b) ...which means that you must garage your supercar for 3-4 months of the year because it's just not practical to use.

2c) ...which means that you have:

2c1) ...two cars (no big deal)

2c2) ...and the ability to garage one of them full-time for 3-4 months, which is a problem anywhere in the 617 area code because...

2c2a) Boston Is Full.

Re: Tesla Smashes Earnings And Revenue Expectations

#182

Post by pyoung »

olympus wrote: post #109
pyoung wrote: post #103

Earlier quoted context omitted.

What?!!! Just so I get this straight. In order to short the stock you have to pay an annual interest rate of 46% of the stock value? I realize most shorts are probably only in it for short term, but that is still pretty insane.

Not sure if you're joking or not, but I'll offer a quick explanation. Interest in this context does not mean interest on a loan, but rather how many people are interested in shorting the stock. The 46% short interest meant that almost half of Tesla's stock was shorted. To put it another way, 46% of Tesla's stock was loaned out from various parties to sell to other various parties. This is a bad thing for the short se…

Got it, thanks. Do brokerages charge interest rates for allowing shorts to borrow the stock?

Re: Tesla Smashes Earnings And Revenue Expectations

#183

Post by revelation »

pyoung wrote: post #182
olympus wrote: post #109

Earlier quoted context omitted.

Not sure if you're joking or not, but I'll offer a quick explanation. Interest in this context does not mean interest on a loan, but rather how many people are interested in shorting the stock. The 46% short interest meant that almost half of Tesla's stock was shorted. To put it another way, 46% of Tesla's stock was loaned out from various parties to sell to other various parties. This is a bad thing for the short se…

Got it, thanks. Do brokerages charge interest rates for allowing shorts to borrow the stock?

olympus actually misunderstood me, and you were spot on :)

Brokers do charge interest rates and the rates for TESLA really were 45% (current) and 85% (once upon a time) annualized, mostly because of a deficiency in available shares. At that point it was costing 60c per share a week just to keep your short position.

Theres plenty of discussion here: http://www.teslamotorsclub.com/showthread.php/15183-Cost-to-...

Re: Tesla Smashes Earnings And Revenue Expectations

#184

Post by mynewwork »

JPKab wrote: post #163
mynameishere wrote: post #110

Earlier quoted context omitted.

If you sell puts against a short position from May 8 to May 17 (strike: 55.00, price: ~3.40), you can make >5 percent in 9 days. I'm guessing that most of the people borrowing shares at that rate are selling straddles to retail that make the overall position look less crazy. http://finance.yahoo.com/q/op?s=TSLA+Options ...the implication is that unhedged longs are carrying the real risk.

Do you have a recommendation for a good reference to learn all this lingo? I understand what a short is, but WTF is a 'put'? 'Straddles'??? 'Unhedged longs'?

http://www.investopedia.com/ is a decent resource for the beginner to understand terminology.

Re: Tesla Smashes Earnings And Revenue Expectations

#185

Post by olympus »

revelation wrote: post #183
pyoung wrote: post #182

Earlier quoted context omitted.

Got it, thanks. Do brokerages charge interest rates for allowing shorts to borrow the stock?

olympus actually misunderstood me, and you were spot on :) Brokers do charge interest rates and the rates for TESLA really were 45% (current) and 85% (once upon a time) annualized, mostly because of a deficiency in available shares. At that point it was costing 60c per share a week just to keep your short position. Theres plenty of discussion here: http://www.teslamotorsclub.com/showthread.php/15183-Cost-to-...

Oh, wow. With numbers that high it never crossed my mind that you were talking about loan interest. Normally the interest you pay to short a stock is single digits, and if you have enough money it can be I was thinking of this: http://www.investopedia.com/terms/s/shortinterest.asp

You can see the short interest in TSLA here published twice a month: http://www.nasdaq.com/symbol/tsla/short-interest which is very high compared to AAPL's short interest: http://www.nasdaq.com/symbol/aapl/short-interest which hovers around one day to cover.

Re: Tesla Smashes Earnings And Revenue Expectations

#186

Post by pyoung »

mynameishere wrote: post #110
pyoung wrote: post #103

Earlier quoted context omitted.

What?!!! Just so I get this straight. In order to short the stock you have to pay an annual interest rate of 46% of the stock value? I realize most shorts are probably only in it for short term, but that is still pretty insane.

If you sell puts against a short position from May 8 to May 17 (strike: 55.00, price: ~3.40), you can make >5 percent in 9 days. I'm guessing that most of the people borrowing shares at that rate are selling straddles to retail that make the overall position look less crazy. http://finance.yahoo.com/q/op?s=TSLA+Options ...the implication is that unhedged longs are carrying the real risk.

So you are saying that a lot of the short interest is coming from people hedging their long bets?

I can somewhat relate to why one would take this strategy, as Tesla is getting a lot of hype, implying that the stock might break out (or already did, currently at $71), but they are also in a fairly precarious financial situation, with a ton of debt. Elon himself warned that if the company didn't get to positive cash flow it was likely they would go under. Still it seems like a high price to pay for a hedge, wouldn't it be simpler (and possibly cheaper) just to reduce your long position?

Re: Tesla Smashes Earnings And Revenue Expectations

#187

Post by dangoldin »

technoslut wrote: post #168
dangoldin wrote: post #116

Earlier quoted context omitted.

I think the bigger problem is that most people don't own cars in NY since they don't really need them and they're a pain to park unless you're paying for a parking spot. Even then that parking spot may not provide the ability to charge your car. I suspect that if more people in NYC had garages in their owns we'd be seeing more Teslas.

I've seen far more Ferraris out on the road than Teslas and they cost, at least, twice as much. This is not including vehicles that are similarly priced to even the Tesla Roadster which only increases that ratio. I'd include Long Island (which do have traditional homes and garages) in this as well where I've never seen one on the road. I think there are issues that exist beyond what you mentioned.

So you think it's just cultural differences between the West and East Coast? That's possible. I'm in the tech scene in NYC so I may have a lot more in common with the West Coast culture than the one here.

I have spoken with a few of my non-tech friends about Tesla and they're all pretty bearish on it so maybe you're right. What do non-tech people on the West Coast thing about it?

Re: Tesla Smashes Earnings And Revenue Expectations

#188

Post by rdl »

dangoldin wrote: post #187
technoslut wrote: post #168

Earlier quoted context omitted.

I've seen far more Ferraris out on the road than Teslas and they cost, at least, twice as much. This is not including vehicles that are similarly priced to even the Tesla Roadster which only increases that ratio. I'd include Long Island (which do have traditional homes and garages) in this as well where I've never seen one on the road. I think there are issues that exist beyond what you mentioned.

So you think it's just cultural differences between the West and East Coast? That's possible. I'm in the tech scene in NYC so I may have a lot more in common with the West Coast culture than the one here. I have spoken with a few of my non-tech friends about Tesla and they're all pretty bearish on it so maybe you're right. What do non-tech people on the West Coast thing about it?

I think girls are more interested in "green" issues in SF than on the east coast, so if you are a rich guy buying a car to help with the mating game, a Tesla might be a better choice out here. It is also a $100k car you can buy to claim to be forward thinking on tech and the environment, rather than just flaunting wealth (which is discouraged here).
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