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Tesla Q1 2020 Update

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Re: Tesla Q1 2020 Update

#191

Post by renewiltord »

Obi_Juan_Kenobi wrote: post #114
tempsy wrote: post #72

I’m watching in disbelief at the stock market making a V shaped recovery. Nasdaq is only a few percentage points off it’s all time high. I guess don’t underestimate the American consumer even at a time of economic uncertainty? I don’t know how else to explain record sales from Tesla, Facebook, and Microsoft today.

Don't lose sight of reality; business closings left and right, layoffs, pay cuts, etc. Don't let the zero-hedge crowd turn you off to arguments about funny-money from the fed. This is a fairly predictable result. Fed supplies money. Money has to be put to use. Where is productive capital? Interest rates are itty bitty. Stocks look high but .. what else to do? Risk buying high now or inflation later. But this can only…

When do your shorts expire?

Re: Tesla Q1 2020 Update

#192

Post by jlbnjmn »

kenhwang wrote: post #144
save_ferris wrote: post #39

Earlier quoted context omitted.

He might be more concerned about the sales prospects instead of operational expenses. Automakers are getting hit really hard by this pandemic, and they need a healthy economy to sell cars. Many economic forecasts are saying that a full recovery is 2-4 years away, although there are many different opinions.

Tesla relies on high volume to make money; the other automakers are pricing EVs based more on margin. An economic slow down hurts volume much more than it hurts margins. Tesla also relies heavily on first-mover advantage to grow. With the virus stalling everything, all the more cash rich automakers get time to catch up on R&D, while Tesla is stalled from being unable to physically expand. Tesla also becomes more cash…

Tesla relies on high margins, other automakers rely on volume.

Ford is in a much worse position than Tesla.

Re: Tesla Q1 2020 Update

#193

Post by zaroth »

gamblor956 wrote: post #103
adventured wrote: post #43

Earlier quoted context omitted.

I doubt it. He's worth $38.5 billion; $26b of that is in Tesla. He can shave off hundreds of millions of dollars from that any day of the week - if he cared to do so. The compensation package is relatively small compared to his existing wealth already contained in Tesla. Wanting the company to succeed is what most likely motivates him, not the compensation package (which is aligned with his existing interests, even i…

Musk is worth $38.5 billion based on his current Tesla stock holdings at their current valuation. If he hits the trigger in his compensation package, he gets even more Tesla stock which will vastly increase his net worth on paper Also, Musk is loaded with debt because he leveraged his stock holdings to live a very lavish lifestyle, including multiple residential properties, vehicles, and very expensive dining choices…

> If he hits the trigger in his compensation package, he gets even more Tesla stock which will vastly increase his net worth on paper.

Elon currently holds ~34 million shares of Tesla. If TSLA market cap hits a 6-month running average of $100 billion his first of 12 tranches of stock options vest, which is 1.69 million shares at $350 per share.

Musk will spend $591 million to buy the 1.69 million shares, which on the open market are worth $1.352 billion. What actually happens is he executes the options and immediately sells shares to cover the execution cost, for a net gain of ~950k shares. He then also has to sell shares to cover the taxes due at the time of exercise, which we'll under-estimate at 20% of the profit ($450 * 1.69 million * 20%) = $152 million. That's another 190,000 shares gone. Now we're down to a net gain of 760k shares on the 1.69 million.

So when the tranche vests, he will own ~2.2% more TSLA stock than he did the day prior. Best case. If tax rate is higher, which it is because California, it's probably less than a 2% bump to Elon's overall TSLA holding.

EDIT: Oh, one other thing. Any shares which are not sold to cover the strike price and the taxes due I believe must be held by Elon at least 10 years before he can sell any.

So the primary effects of hitting a tranche are 1) it generates $591 million of cash flow for Tesla, a nice equity raise. 2) it generates at least $150 million in tax revenue for We The People.

Re: Tesla Q1 2020 Update

#194

Post by quaquaqua1 »

anoncareer0212 wrote: post #150
ryanwaggoner wrote: post #129

Earlier quoted context omitted.

There are no very expensive vehicles or dining choices when you’re worth tens of billions. It’s literally meaningless, like it would be for me if all my meals for a year cost me 1% of a penny.

Actually verifiably not true, he had a margin call just last year, the stock hit $180.

Yet again people downvoting the truth.

Re: Tesla Q1 2020 Update

#195

Post by jakecopp »

maxharris wrote: post #121
refurb wrote: post #101

Earlier quoted context omitted.

I think Tesla falls firmly in “luxury good” and with mass unemployment, Tesla might see much less demand for much longer than just the lockdown.

You're forgetting about Battery Day next month! You will find out that Tesla hits $100/kWh, which means they'll be able to sell an electric car for the price of a gas one, without giving up range. You're also forgetting that what they're selling has no real competition, just like the iPhone didn't skip a beat through the 2008-2009 crisis. Also their full self-driving tech is ahead of everyone, including Alphabet. I t…

> their full self-driving tech is ahead of everyone, including Alphabet

This seems doubtful, I'd be really interested to read any source that advocates that :)

Re: Tesla Q1 2020 Update

#196

Post by woodandsteel »

threeseed wrote: post #143
Reedx wrote: post #136

Earlier quoted context omitted.

> Will Elon stop with tweets that hurt Tesla? Appoint a CEO, or COO to run things People have been saying that for years and years. It's beyond stale. Meanwhile Tesla and SpaceX have continued to succeed beyond expectations for over a decade now. If there's occasional twitter volatility in-between simultaneously landing two rockets returning from space... so be it. Besides, if it bothers you that much, you don't have…

Of course what Musk does matters. He's the CEO. And his erratic and reprehensible behaviour is degrading the Tesla brand as well as reaffirming the long held idea amongst shareholders that he is too unstable to be running the company.

I can think of no important way in which Tesla or SpaceX would be significantly more successful today if Musk had publicly communicated more like a standard CEO.

Re: Tesla Q1 2020 Update

#197

Post by jlbnjmn »

Scipio_Afri wrote: post #61
save_ferris wrote: post #39

Earlier quoted context omitted.

He might be more concerned about the sales prospects instead of operational expenses. Automakers are getting hit really hard by this pandemic, and they need a healthy economy to sell cars. Many economic forecasts are saying that a full recovery is 2-4 years away, although there are many different opinions.

Oil prices don't help the EV argument. However the main issue is that they have to deal with their products being priced high compared to the rest of the industry at a time when wages are likely to fall.

The EV argument != the Tesla argument.

Re: Tesla Q1 2020 Update

#198

Post by _ea1k »

blizkreeg wrote: post #98
xur17 wrote: post #54

Earlier quoted context omitted.

Plus, the price of gas has gone down significantly, hurting one of the benefits of electric cars.

I don't believe the Tesla crowd bought theirs to save on gas anyway, so not sure if this is true.

I've always felt like the base Model 3 and base BMW 3 series were very comparable. Add in a couple of thousand, and the 3 looks like a bargain.

That becomes a harder sell when the Model 3 is actually more expensive to operate, as it is in some places now.

Its not that they are buying to save money vs the economical choices, but it does make a difference relative to their comps (RWD & AWD sport sedans).

Re: Tesla Q1 2020 Update

#199

Post by wonderwonder »

Barrin92 wrote: post #187
megaman821 wrote: post #88

Earlier quoted context omitted.

You think Elon Musk's motivation is greed? That people going back to work or not will greatly affect his lifestyle? Is there any nuance when it comes to Elon Musk, or only fan-boys and haters?

Not the OP. I don't think his motivation is greed in a strictly financial sense but he's a complete narcissist. When a government guy comes and shuts his factory down due to a pandemic he apparently can't live with the fact that he's a non-essential business and needs to lay low for a while. It's the same thing with the mini-submarine paedophile fiasco. Some regular dude who has experience in what he's actually talki…

He has lofty goals that require massive resources. Each also requires a long timeline. Specifically he is attempting to populate another planet, link computers to brains and turn transportation green. Each is an earth shattering accomplishment on their own. He is trying to do all 3 and in his mind at least he is driven by saving humanity not greed. He feels the current restrictions are going to have severe impact on what are for him lifetime goals.

Now is it narcissistic to think that he has to do it? Maybe. Often times though I would think that the people that changed our way of life have to be narcissistic. Gates, Jobs, Rockefeller, Ford, Edison. They are real people with flaws but sometimes those flaws also drive them. Not malignant narcissistic though, there is a difference.

He is definitely ill served by his twitter account though and these recent tweets are not great in regards to the opinions of many of those that support him.

Re: Tesla Q1 2020 Update

#200

Post by dantheman »

microtherion wrote: post #131
gamblor956 wrote: post #103

Earlier quoted context omitted.

Musk is worth $38.5 billion based on his current Tesla stock holdings at their current valuation. If he hits the trigger in his compensation package, he gets even more Tesla stock which will vastly increase his net worth on paper Also, Musk is loaded with debt because he leveraged his stock holdings to live a very lavish lifestyle, including multiple residential properties, vehicles, and very expensive dining choices…

Very expensive dining choices? How much truffled avocado toast do you have to eat to make a dent in his kind of wealth?

You do know he almost went bankrupt awhile back - starting companies is incredibly expensive and his wealth is in the ownership of the companies - not just an investment portfolio.
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