Tesla lost $38M in third quarter, stock tumbles over 12 percent • Hacker News Board

Re: Tesla lost $38M in third quarter, stock tumbles over 12 percent

#51

Post by SwellJoe » Wed, Nov 06, 2013, 4:13 AM UTC

rdl wrote: post #41

cs702 wrote: post #31

Tesla's stock price at present reflects and is driven primarily by the exuberant optimism of its shareholders, not by mundane financial details like how many millions the company lost or how many cars were sold last quarter. Consider that despite today's drop, the stock price has gone up 4.6x this year (from $33.87 at year-end 2012 to around $155 right now), but over the same period the company's quarterly revenues h…

The scary thing for me with Tesla stock is primarily the risks in going to large scale mass market cars, as well as the risk of another car company, or another startup, emerging to win the mass market EV space.

I think the danger is in the big automakers getting EV right, before Tesla reaches the middle and low end of the market. Nissan has the Leaf, which is by most accounts, a great little car. The Chevy Volt is the best-selling in my neck of the woods, it seems. Tesla makes better electric cars...as far as the reviews indicate. But, they're also much more expensive.

But, here's the reason I just placed a limit order for tomorrow morning (I'd check into TSLA a couple of times this year and thought, "Nope, still trading too high."): Tesla is currently selling as many cars in a year as Chevy sells in three days. So, the stories I can envision in my head for how this will play out are one of the two:

1. Tesla will fail to scale up. They will not be able to continue executing on their business plan effective. Growth will halt. The big auto makers will gradually move into the EV market. They will use their leverage as larger players with more money to throw around to beat Tesla on the battery front and on manufacturing costs. Tesla will remain a bit player, and be bought up for patents in a few years. The stock will not do well, long term, in this scenario.

2. Tesla will continue to execute well, if not flawlessly as they have done up to now (let's be honest, Tesla has an amazing record of doing the right thing at the right time). They will continue to grow at a very rapid clip. They will enter new markets. They will sell more cars than they can manufacture (and maybe more electric cars than anyone else can manufacture also, due to the current limited battery availability). They will continue to execute well on battery acquisition and development. They will continue to execute well on solving the cross-country EV trip problem...before any other manufacturer. And, they will become a major automaker. The market is huge. They're less than 100th the size of Chevrolet or Ford. That's a lot of room for growth, even with their share price being hundreds of times earnings (yes, it really is a very expensive stock, in that regard).

So, my primary question is: Will they execute really well. History says they will.

And, my next question is: Will I get other chances to buy at a discount over what it's trading at now? I don't know. I've regretted not buying stocks in the past due to it looking really expensive. I put off buying GOOG for a long time. Watched it from IPO on up to $750+. Then it went on sale for $340, and I backed up the truck as well as my stock portfolio would allow (so, I'm currently approaching a triple bagger on GOOG). TSLA is no GOOG. Probably never will be. But, it's potentially a much larger company than it is today. I'm willing to bet a few bucks that it will be. But, it is definitely gambling and not value investing.

Re: Tesla lost $38M in third quarter, stock tumbles over 12 percent

#52

Post by AnthonyMouse » Wed, Nov 06, 2013, 4:17 AM UTC

derekp7 wrote: post #47

rdl wrote: post #41

Earlier quoted context omitted.

The scary thing for me with Tesla stock is primarily the risks in going to large scale mass market cars, as well as the risk of another car company, or another startup, emerging to win the mass market EV space.

If another company came up with a dual-powered version of the Tesla, then I would definitely buy that. The current round of plugin hybrids don't offer enough battery-only range for me. I'd like to see about 100 mile battery only (in case I forget to plug it in), plus a small engine and 10-gallon tank. I wouldn't think the gas engine would have to be that large, especially if it were designed to use the battery as a b…

The problem is that it's not just the engine. If you want an engine then you need a fuel tank, emissions controls, either a transmission or a separate electric generator attached to the engine, etc. All of that stuff adds weight and cost, or reduces the space, weight and cost budget you have for batteries and electric motors. By the time you've paid for it you might as well forget about the 30HP engine and put in a 100HP engine, at which point you have a Prius.

Re: Tesla lost $38M in third quarter, stock tumbles over 12 percent

#53

Post by tokenadult » Wed, Nov 06, 2013, 4:23 AM UTC

eru wrote: post #30

tokenadult wrote: post #15

I read a financial newspaper report earlier today predicting good results for Tesla for its quarterly earnings report today, and thus a likely continued strong performance of Tesla stock. Seeing the headline of the article kindly submitted here prompted me to read the fine article, of course, and also to check for other news stories from later hours of today about Tesla. In approximate chronological order: "Tesla Mot…

For any sale there will be a buy and vice versa.

For any sale there will be a buy and vice versa.

Well, yes, of course, and I think everyone here on Hacker News is aware of that. But the transaction may not occur at the price you desire. "The market can remain irrational longer than you can remain solvent" is still an important idea for investors to keep in mind.

Re: Tesla lost $38M in third quarter, stock tumbles over 12 percent

#54

Post by eru » Wed, Nov 06, 2013, 4:45 AM UTC

tokenadult wrote: post #53

eru wrote: post #30

Earlier quoted context omitted.

For any sale there will be a buy and vice versa.

For any sale there will be a buy and vice versa. Well, yes, of course, and I think everyone here on Hacker News is aware of that. But the transaction may not occur at the price you desire. "The market can remain irrational longer than you can remain solvent" is still an important idea for investors to keep in mind.

Not a price you desire, but always a price you approve of. (Barring margin calls and similar complications.)

Re: Tesla lost $38M in third quarter, stock tumbles over 12 percent

#55

Post by Arzh » Wed, Nov 06, 2013, 4:48 AM UTC

tvladeck wrote: post #44

cs702 wrote: post #31

Tesla's stock price at present reflects and is driven primarily by the exuberant optimism of its shareholders, not by mundane financial details like how many millions the company lost or how many cars were sold last quarter. Consider that despite today's drop, the stock price has gone up 4.6x this year (from $33.87 at year-end 2012 to around $155 right now), but over the same period the company's quarterly revenues h…

If your first sentence were true, then the stock shouldn't have been affected much by today's news. Instead, it fell significantly. The price of the stock has to do with how much money it might make in the future, and where they are on their growth trajectory. The news today signifies that the trajectory might be lower overall, or they might be further behind than investors thought.

The stock is up $1.61 on the day, the stock did not tumble, what tumbled was wall street's interest.

Re: Tesla lost $38M in third quarter, stock tumbles over 12 percent

#56

Post by bsdetector » Wed, Nov 06, 2013, 5:02 AM UTC

rdl wrote: post #41

cs702 wrote: post #31

Tesla's stock price at present reflects and is driven primarily by the exuberant optimism of its shareholders, not by mundane financial details like how many millions the company lost or how many cars were sold last quarter. Consider that despite today's drop, the stock price has gone up 4.6x this year (from $33.87 at year-end 2012 to around $155 right now), but over the same period the company's quarterly revenues h…

The scary thing for me with Tesla stock is primarily the risks in going to large scale mass market cars, as well as the risk of another car company, or another startup, emerging to win the mass market EV space.

Toyota is supposedly coming out in 2015 with production cars with fuel cells costing a bit more than what a Tesla battery does, but the more they produce the less costly they are. In contrast, the more batteries Tesla produces the more the cost of lithium increases.

It seems like an incredible proposition that Tesla will expand fast enough to shut out fuel cells before they get established.

Re: Tesla lost $38M in third quarter, stock tumbles over 12 percent

#57

Post by dxhdr » Wed, Nov 06, 2013, 5:03 AM UTC

Arzh wrote: post #55

tvladeck wrote: post #44

Earlier quoted context omitted.

If your first sentence were true, then the stock shouldn't have been affected much by today's news. Instead, it fell significantly. The price of the stock has to do with how much money it might make in the future, and where they are on their growth trajectory. The news today signifies that the trajectory might be lower overall, or they might be further behind than investors thought.

The stock is up $1.61 on the day, the stock did not tumble, what tumbled was wall street's interest.

What we're talking about is the after-hours trading price of the stock. It will open tomorrow at the new, reduced price.

Re: Tesla lost $38M in third quarter, stock tumbles over 12 percent

#58

Post by tanzam75 » Wed, Nov 06, 2013, 5:11 AM UTC

Arzh wrote: post #55

tvladeck wrote: post #44

Earlier quoted context omitted.

If your first sentence were true, then the stock shouldn't have been affected much by today's news. Instead, it fell significantly. The price of the stock has to do with how much money it might make in the future, and where they are on their growth trajectory. The news today signifies that the trajectory might be lower overall, or they might be further behind than investors thought.

The stock is up $1.61 on the day, the stock did not tumble, what tumbled was wall street's interest.

> The stock is up $1.61 on the day, the stock did not tumble, what tumbled was wall street's interest.

Up $1.61 at the closing bell, then down $22 after-hours, equals down $20.

Quite a substantial move for a $176 stock -- at least, it was a $176 stock at 4 o'clock on November 5.

Re: Tesla lost $38M in third quarter, stock tumbles over 12 percent

#59

Post by lsc » Wed, Nov 06, 2013, 5:22 AM UTC

foobarqux wrote: post #49

lsc wrote: post #45

Earlier quoted context omitted.

a one out of a thousand chance at making a million bucks has a 'fundamental value' of $1000. The problem with valuing tesla is not that it lacks 'fundamental value' - it's not even that this value is risky. The problem is that nobody knows /how/ risky that bet is. Of course... once the uncertainty passes a certain point... it sure looks like it's completely disconnected from 'fundamental value' Personally? I can see…

Thankfully your options are not limited to Tesla and Facebook

Eh, perhaps my point would be better phrased as:

Of all the new technology companies... my perception is that Tesla has rather more 'fundamental value.' If nothing else, they are one of the very few companies that doesn't rely for revenue on a relatively new kind of advertising.

Re: Tesla lost $38M in third quarter, stock tumbles over 12 percent

#60

Post by PakG1 » Wed, Nov 06, 2013, 5:48 AM UTC

SwellJoe wrote: post #51

rdl wrote: post #41

Earlier quoted context omitted.

The scary thing for me with Tesla stock is primarily the risks in going to large scale mass market cars, as well as the risk of another car company, or another startup, emerging to win the mass market EV space.

I think the danger is in the big automakers getting EV right, before Tesla reaches the middle and low end of the market. Nissan has the Leaf, which is by most accounts, a great little car. The Chevy Volt is the best-selling in my neck of the woods, it seems. Tesla makes better electric cars...as far as the reviews indicate. But, they're also much more expensive. But, here's the reason I just placed a limit order for…

They will sell more cars than they can manufacture (and maybe more electric cars than anyone else can manufacture also, due to the current limited battery availability). They will continue to execute well on battery acquisition and development.

This battery supply thing reminds me of this story: http://qr.ae/N0Uxr