Own any Tesla stock??

Discussion in 'the Bird Room' started by sOOper hero, Nov 18, 2017.

  1. Jim Nazarian
    Jim Nazarian

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    Since 2013 my advice to people when asked about investing in TSLA has been simple...

    Tesla is entering & colliding with massive competitors in the Auto, Energy creation & Energy distribution markets, its going to be a difficult challenge so expect a volatile stock, losses reported at times, dilution & a rollercoaster ride, I tell them the Total Addressable Market (TAM) is massive so there is huge potential but its going to take TIME, while difficult I advise people get in the mindset of a private equity investor so thier focus won't be on quarterly results but on longer term potential, if you can see where Tesla is headed in 5-10 years & you are happy with the company execution then I tell them to hold the stock, if not they should sell, but most importantly do not judge it by short term metrics. That sounds easier said then done & I have been frustrated with production execution & shorted the stock several times myself but I still see Tesla's potential in these massive markets.

    Invest in founding CEO's that can disrupt!
  2. Jim Nazarian
    Jim Nazarian

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    While EV's existed prior to the Model S they all sucked, none of them offered 300 miles of range with less then 3 seconds 0-60mph performance in a family sedan that looked good & was safest car ever made. the Model S has taken ~35 market share in the luxury car segment in just a couple years, sales & revenues have been growing at roughly 50% annually & many expect +40% growth to continue, amazon investors for many years accepted losses because they believed eventually the investments will eventually pay off, its the same with Tesla, investors are willing to fund growth currently & accept losses as long as they see future growth disrupting large addressable markets, there have been times like the Solar City merger (bailout) or product delays like the Model X & recent Model 3 that the stock suffered so investors have voiced displeasure.

    Model S&X gross margins have been in the mid 20's, reached 28% for a QTR or two so the car is profitable, to date large investors accept quarterly losses because they are focused on long term growth, how long that continues I dont know, but like amazon losses were accepted for years while the story unfolded.

    Re. "Moats" it took a lot to get a rug sucker like me to buy a Tesla, I was sick of other OEM's, the dealership haggle, gas stations & imported oil etc...I felt Tesla was offering a product & an experience that was totally different then anyone else, they completely leapfrogged everyone out there & continue to do so, I have been spoiled with over the air updates that improve my car or add features even though my car is 4 years old while it sits in the car, I am spoiled that if its needs service they come to the house perform the work there or if needed drop of $140k loaner while mine is taken into service, it will take another leapfrog from another new disrupter for me to leave Teslas moat, many of Tesla early executives were from Apple so they understand creating an ecosystem with incredible service & loyalty (comparing ownership experience BMW's off & on for 25 years).

    Any company that is vertically integrated & controls all aspects of the car will have a huge advantage, the company that designs its battery, manufactures its battery to run optimally in its fleet will always have an advantage then any OEM that just plugs in a Samsung or LG battery. Recently during the Florida hurricane Tesla thru a software update temporarily unlocked range, they were given 30-40 extra miles of range, even more mind blowing Tesla discovered by changing a wire that connects a wire from the battery to a drive unit the car would have significant performance boost, so for free certain cars are now 1 second faster 0-60mph!!!!! Thats crazy, other OEM's would never think of doing that for free even if they could, just a few small moats :)
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  3. The Great Oz
    The Great Oz

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    Not making any comment on the car itself, as people that buy Teslas seem to like them. My untrained opinion:

    Apple was mentioned and I think there are some similarities in being (my opinion) wildly overvalued. Although very profitable, Apple relies on a cult-like fan base of people that will buy anything they make at any price. (Including their stock) Apple is a design company that happens to sell tech products. Often better products are available for less money, which makes Apple products an emotional or "style" buy. Apple became uncool before and almost disappeared. Could happen again. I'd guess that Apple and Tesla customer bases have a lot in common.

    Tesla has the media attention and head start, but the stock dropped over 15% just because Volvo said they will be all-electric in a few years. The German makers were big on diesel, and after they got caught cheating are now all-in on electric as their future alternative vehicles. The rest of the car industry knows how to build cars in volume and at a profit, and since Tesla can't make money now I think it unlikely that serious competition will make things easier. Also, a lot of Tesla's income is derived from selling energy credits, a market that goes away when those credit buyers are making their own electric vehicles. It certainly doesn't help that Musk isn't credible, since he has a history of missing target dates and sales numbers to the point of the press making fun of his every announcement.

    Many people, including Lutz, have speculated that Musk isn't serious about being a car builder anyway, he's using car manufacturing and solar ( and all the related subsidies ) to build his real business, batteries and a car charging network to be used by other maker's electric cars. Even if that's the goal, I think the company value is still too high. Those industries have existing big players that may be waiting for Musk to run out other people's money. They'll let Tesla make the mistakes and then step in if there's money to be made.
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  4. The Great Oz
    The Great Oz

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    PS: I'm a safe-n-sane investor. My one reach was amazon.com at $50. It was easy to understand where they were going.
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  5. Cleanworks
    Cleanworks

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    I'll invest when Tesla makes a full electric truckmount.
  6. Bob Pruitt
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    I think Apple is a software company that makes well designed hardware. They are as Customer focused as amazon....that's why they win and that's why both companies will continue to do so.
    Focus on the Customer experience for the win.
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  7. Jim Nazarian
    Jim Nazarian

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    There is a large percentage of Tesla cult car owners & shareholders, many are extreme Liberal + environmentalist (whackos IMO) & won't sell TSLA & think Musk can walk on water & he's saving the earth from man made global warming...I am not one of those.

    While I have attended several Tesla reveal events at Hawthorn & Fremont, the past 4 annual shareholder meetings, toured the Fremont factory 4 times & even a rocket launch at Vandenberg I still curse & criticize Tesla equally as much as I see thier potential.
  8. Acp
    Acp

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    People freak out over electric vehicles and think they are saving the planet, but the juice used to charge those batteries still has to come from somewhere lol

    Tesla was talking about making a more economy model at one point, in the 30-40k range.. not sure if that is still in the plans
  9. Jim Nazarian
    Jim Nazarian

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    Best source of energy is the sun or other renewables, fortunately the cost of renewable energy generation is dropping to the point where its equal to carbon based generation, combining renewable generation with battery storage soon will eliminate the need of expensive power plants, eliminate blackouts & of course thier harmful emissions.

    The affordable Tesla is called Model 3, production just began & will slowly ramp into 2018 https://www.tesla.com/model3
  10. sOOper hero
    sOOper hero

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    which ones are competitive without gov subsidies?
    (on a national scale, not small (relatively) geographical areas that pay 3 to 4 times as much for eclectic compared to the rest of us)

    I'd suggest that's a pipe dream, Jim
    Stick n mud hut third world villages may benefit greatly
    and tiny population countries with mega geothermal like Iceland possibly

    but not in industrialized countries with hundreds of millions of people that like running AC and blow drying their hair every day
    (not to mention the power needs to manufacture all the goods we take for granted )...and batteries

    renewable won't be replacing carbon based anytime soon
    ...............................................................................................................................................................

    to the thread subject
    everyone on this thread is smarter than me .
    and I'm neither pro nor con ..if anything pro Tesla (who wouldn't want a screaming fast luxury ride) :cool::cool:
    and who in their right mind wouldn't want a cleaner alternative to daily travel at competitive overall costs
    We're just not there yet though

    no clue if Tesla will be around in 2-5 or 10 years
    I suspect they could as a niche player and/or if they develop tech that blows everyone else out of the water

    ....that's all good to me

    ..L.T.A.
  11. Newman
    Newman

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    I read your post, then read an article on solar energy credits. I still can not wrap my mind around the concept.

    Is that due to my Midwestern sensibility?
  12. Nomad74
    Nomad74

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    Tax credits = Free Gov money. The company is losing $1.4 Billion annually. The only reason why this continues is because Musk is a liberal media darling catering to the greenies. Don't get me wrong, I'm all for clean energy, but his companies are all a shell game. The fundamentals of the balance sheet don't lie. If he was Howard Hughes he would have been pulled in front of congress for questioning by now.

    Remember Solyndra?
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  13. Jim Nazarian
    Jim Nazarian

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    @Larry, Apologize for not be clear, I was speaking about the need for NEW power plants & NEW power peaker plants & was not implying renewables were about to replace conventional carbon sourced plants anytime soon, in 2017 we have seen deployment of battery storage connected to renewable sources replace conventional power first in remote locations & in south Australia where electricity is expensive & millions were suffering blackouts, 2 miles from my home was the Aliso Canyon natural gas storage facility that nobody even knew existed, 2 years ago one of the wells sprung a leak spewing 60 million metric tons of Methane into the air, part of the reason gas is stockpiled is to feed peaker plants in the summer when demand is greatest for electricity, utility's worldwide have begun building large battery storage to eliminate peaker plants, to help mitigate stress to the grid when demand is high, to help with rolling blackout outs etc...Business & homeowners are also installing battery storage.

    I agree renewables won't be replacing carbon anytime soon but Elon & Tesla have shown what EV's can do & they have opened peoples mind & are producing a car IMO that is better then any internal combustion engine out there.

    Overall costs is the key comparison, Our Model S replaced a GMC Yukon, a new one was going to cost about $60k add another $5k in gas per year, after 6 years I was at $90k out of pocket, after 8 years $100k...at this point getting a Tesla was cheaper & way better then a lousy Yukon.

    For awhile I had hoped Tesla would stay a niche player like BMW while they matured but as a AMZN shareholder as well I have seen Bezos try many things, some fail & some pay off huge so I guess as long as the economy holds up & investors continue to have confidence with Elon master plans (1 is finishing we are on part 2) with Model 3 being critical & its launch is upon so we will see in the next 6 months if they can deliver a mass market quality built car at good gross margins as promised.
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  14. Jim Nazarian
    Jim Nazarian

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    Your making false & foolish statements.
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  15. Nomad74
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    Never become emotionally attached to an investment. If you do then it’s time to walk away.
  16. Bob Pruitt
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    amazon lost money year after year after year... they just bought Whole Foods. Grocery Stores are going to have to innovate and...deliver.
    I don't know if Tesla is the next great thing but I do know the Old Guy in the video will not be changing the world.
    General Motors may buy Tesla to learn how to innovate or maybe to just crush it... but probably not.
    More likely is in 10 years Tesla buys GM. The electric cars are here to stay and they are beginning to scale...get cheaper.
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  17. ruff
    ruff

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    Long term thinking and the best long term interest of a country, at times may necessitate subsidies. If only to prevent other countries reap the benefits of (in this case) US developed technologies. A financial and economical mistake. Look what China has been doing consistently.

    Leaving everything to "Free Market" forces, is the equivalent of letting your new born baby fend for itself. I guess it will make for strong survivors. And or PTSD :winky:

    It's similar to naming your first born son- Sue.
  18. Able 1
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    The free market should decide winners and losers, not the government!! The reason they need subsidies is there is only a small percentage of people that want said product(kinda like Obama care). If this was even a good idea AT THIS TIME someone would be pushing hard to develop these cars without subsidies..



    I'm going to go burn a tire.. :eekk:
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  19. FredC
    FredC

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    ^

    http://www.businessinsider.com/elon...ric-car-subsidies-trump-administration-2017-2




    but it would be stupid to not accept and give others an advantage
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  20. Able 1
    Able 1

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    Not sure I see an advantage on a product people don't want.. The only reason Chevy came out with one, was because Obama bailed them out..

    At least I can still get a Twinke!!

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