Key dates for you guys daytrading the stock:

Model X safest SUV ever.
https://www.tesla.com/sv_SE/blog/tes...ng?redirect=no

Pretty large difference in some tests:






Will be pretty hard for Volvo to stay out of the electric vehicle game if they want to keep saying that they make the safest cars.

Congratulations on your all time highs, longs. It's been a brutal few days for you guys.

If it goes up much more I'm taking a longer term options short on this sucker. Will post.

Tooth-

I'm a pretty unsophisticated investor when it comes to the stock market and have been long tesla for a year or so. I tend to agree with most of what you say in this thread but haven't been able to pull the trigger on selling during this huge runup. So what I've been doing is just placing stop order at ~10% under current market price and updating every few weeks. Seems like this way I can continue to ride the runup but have pretty limited downside when the seemingly inevitable crash comes. Is this a reasonable strategy or am I missing something?

You don't have to go long, but never go short long term on a paradigm shifting company

Seems like a great strategy tbh

I'm in the camp that Tesla is overvalued and it's priced as if the near best case scenarios are sure things. I think the company is worth maybe 10 billion on brand equity alone with another 10 billion as a pure luxury sports vehicle manufacturer (basically Porsche). The rest is mostly hype making it the dominant CAR manufacturer for pretty much every auto segment AND/OR the dominant player in some adjacent industry (such as solar panel, utility scale battery supplier, or the battery supplier of ALL EVs)

But I just don't see a catalyst for tanking in the short term. They have TONS of pent up demand and the market has been incredibly forgiving of missed production/delivery goals. For all the misses, they are growing steadily at about 40% per year.

Just a general reminder: there are a lot of losers in the world and they tend to pile into things like Tesla. Enron - with a completely non-viable, money losing business - went up 120% in less than a year, even after a stratospheric run before that. They were cheered by the financial press and analysts, and everyone piled in.



If you're holding Tesla here at $380 rather than getting out, you are strongly -EV over the next year, regardless of what you believe about the long term future of the company.

Seems ok. But ultimately the trade has nothing to do with TSLA, you're just short market vol with a trade/stop system like that. Because whether your 10% stop gets hit or whether TSLA goes up depends entirely on market vol and trend. TSLA is largely irrelevant; as are the details of most bubbly crap stocks. The market rules all when it comes to these hyped crap stocks. This is even more true when they short % is maxed out as high as it can go.

Short market vol is a good trade for many. I don't understand it well enough to play it.

When a stock breaks out of its 2 year range to new all time highs AND has a an extremely high short float, it's a nobrainer short/mid-term long. What I have learned over the course of the years, markets always take the route of max pain in these cases

Again, that's just a short market vol bet. A lot of things like this are true in markets that are constantly going up. Until they stop going up.

The Enron -> Tesla comparison is some of your best work Tooth

- Accounting fraud & creative accounting
- Cult-like following
- Loses huge sums of money
- Running up 100% in a few months at the end of a long bull
- Trillion dollar valuation ("the financial system that makes the financial system")
- Lauded as the "new paradigm"
- Valued at absurd multiples of competitors

But maybe you're right. Enron actually turned a profit for a while.

I can't predict the future and I'm way short here but one thing you could do if you think this is going to 500+ long term is reduce your size now and buy back in if the price drops or after things flatten out for a bit. TSLA can keep going up but hoping it continues its rise to $500 on its current pace is absolutely absurd imo

If you short TSLA here because you think Tesla is the next Enron then you are absolutely nuts.

Except that's not what anyone is saying.

People pile into even the most worthless of stocks when the general market is running up. In fact, the crap stocks that end up crashing hard tend to go up more than the good stuff - during the tech bubble, pets.com and Enron kept running - 120% in Enron's case in a final rapid run - while some of the better stuff was cheap.

It's just a reminder that the price has absolutey nothing to do with fundamentals at the end of bubbles. If you think TSLA is $380 because people are seeing the value in it and see a trillion dollar future, you're a nutter. Yet many of the longs in this thread believe that. Just as most Enron buyers did.

TS can you give an example of when you would declare yourself wrong on your Tesla thesis?

Sure. In the long term, whenever Tesla produces and sells a million cars a year at a profit - 2020 according to the fraud Musk *cough*lol*cough* , but whenever really, I'll call the thesis wrong.

In the intermediate term, if Tesla doesn't drop below $200 within a year, I'll call the thesis wrong.

Just for kicks, can you give us a profit/production/price point at which you will call the Tesla bull thesis wrong? At what TSLA price do you admit it was an idiot move holding TSLA at $380?

It's not how this works. Technically, you have been stopped out. Even at $180 you said this is longterm a $0 company. Given that this requires betting money, i.e. shorting the stock. You are technically out.

The stock has destroyed every short that tried to outsmart Musk. I don't think you should buy TSLA stock at $380 and as I said before, I would have recommended to short at $250 but it's fundamentally different argument whether or not a company is still a buy/hold or if it's a worthless company.

What on Earth are you talking about? I think Microsoft is long term a multi trillion dollar company, but I'm not long (although I would get long at $20). And why would I have been stopped out?

I would gladly have gotten short at $277 and would trip over myself getting short here if I shorted stocks.
So did Enron, if you're going to be that silly. And that's why Enron is such a good example.

Shorts have made good money on this stock. Not in the last three weeks when it's run up 30%, but at other times, definitely.

And no, Musk hasn't "destroyed every short that tried to outsmart him".That you see this as a battle of wits is hilarious on an investing forum. You're the kind of person who joins a cult.

The market (and TSLA) has ripped thanks to the Trump, not Musk. Tesla was languishing at $180 before the Trump bull sent large cap tech soaring (many up 40+%), and Tesla with it.

This has nothing to do with Musk, or TSLA. This is what I'm trying to make people understand. This is just like Enron or pets.com - a big name that's running up and is being promoted in the media at the end of a long bull. Enron ripped 100% in a few months. They crashed hard, and Tesla will too, whenever the market bull ends.
I don't care what your position on Tesla long term is, this is the easiest sell in the world here if you're holding. You have to be nuts to hold at $380. You're very -EV.

We will see, it is only like up 25% more for that to happen. If Model 3 production starts smoothly in July and some positive delivery figures comes in for Q2 I think getting that figure isn't too absurd.

TS,

I think we are talking past each other. My main point is that there needs to be a gentlemen's agreement on how long you are allowed to doomsay.

I think the rule should be: Once you've lost your investment, you are no longer allowed to have that view without being ridiculed. It's laughable to basically scream into the screen waiting for TSLA to go down.

This is an absurd view, imo. From March 2014 (when TSLA first hit $250) to November 2016, Tesla lost 20% while QQQ ripped - it underperformed QQQ by a massive 60% over 2.5 years. All that time the bulls were sprinkling bulldust.



Then Trump happened, volatility dipped, and a bunch of stuff - including TSLA - short squeezed on the market rip. A 6 month rip in the lowest volatility bull market in history, followed by an insane 3 week rip of +30%, when all the high betas are running/short squeezing, and you're claiming it's time for the bears to shut up?

Just more evidence of ridiculously inconsistent and short-sighted views among bulls.

Just something to consider - since it's initial huge run after Tesla mainstreamed by late 2013, TSLA has performed merely in line with QQQ (Nasdaq index).

What you're seeing here has nothing to do with TSLA and everything to do with the market. That's what I'm telling people. Yet you have heltoks believing that something magical is happening, that TSLA is finally being recognized as the great investment it is.

This has happened in every long bull in history, for every nutty high-PR zero-long-term-value stock in history. And every time is different to the bulls in that moment, with their Enron or their Pets.com or their Tesla. Thus they hold rather than take their profits. And get left holding the bag. $380 is bagholder territory, and it's not close.

For novice investors ITT who are looking for actual signal, i feel obligated to share my 2 cents on the company. I will focus on the content of ToothSayer's posts because he is by far the most active poster of ITT in both count and content. Tooth is also the main reason i read the thread since i think it is crucial to understand the logic of the investors on the other side of your bets.

Comparing Tesla to Enron is hyperbole to say the least. I wont waste time explaining why, Google can handle that. Posts like the one above though hurt TS credibility and make me more confident about my position.

Reading many TS posts on Tesla, i believe he confuses trading and investing (or at the very least confuse lurkers of this thread that are looking for advice/opinions). I am certain TS knows the distinction between the two but less experienced investors may have trouble filtering opinions on the short term outlook versus the long term prospects of TSLA.

First off, investors purchase debt and equity instruments to receive cash flows in the future in dividends or price appreciation that compensates them for the risk of the company.

Trading is a zero sum game (lets not argue about the value of liquidity traders provide). Trading provides higher rewards but also a significantly higher amount of risk. Timing the market has never seemed like a good idea to me long term, especially due to the fact you are competing with algos with the same mandate (read The Undoing Project for an idea of how humans perform versus models of themselves).

It is important to remember, no one beats the market on a risk adjusted basis. The cumulative knowledge of all investors is always greater than the individuals over the long run. 99.9% of out performance is either luck or cheating.

Now some comments on the company, of which i have been a shareholder since 2012:

The outcome of the discussion between the success of Tesla will likely take 10-20 years. So get comfortable. The payout will be similar to a derivative on both sides of the trade, all or nothing; success and a large market cap (earnings will likely be reinvested as Bezos has done with Amazon) or failure and equity holders get wiped out (maybe debt holders can sell some of the large amounts of fixed assets to recoup some losses).

When i think about what would make me lose on the investment it would be bankruptcy caused by a few different catalysts, or failure to execute on their difficult mission as a company.

In terms of bankruptcy, they have already shown they can raise capital when needed. Since they can raise the capital they will need to work towards thier goals, i cannot see a case for bankruptcy within the next 5 - 10 years. Musk is probably the best CEO in the world for providing a vision and communicating to investors that he knows the path to get there. Tooth will no doubt agree, the man can tell a tremendous story, which is a big advantage when you are asking for money.

Failure to execute on the ambitious goals of the company seems the most likely reason for the company to fail but again, it is going to take a long time to build the fixed assets required.

It is important to note there is not a company on Earth with as much key man risk as Tesla. If something happens to Elon Musk and he can no longer serve his role as CEO, the stock will sell off a tremendous amount, the likelihood of executing their goals will decrease, cost of capital will increase substantially and likely the company would fail.

To conclude, i am not saying i would buy Tesla right now at these prices. Each investor has different risk tolerances and returns they require so i wont say what anyone should do without more information. If the stock does tank within the next 12 - 36 months, i would only buy more.

I hope someone finds this post useful. And i would greatly encourage you all to always work to improve your investment knowledge and leave the knife catching to the algos.

Rick

This is exactly what I'm aiming for (as well as spurring discussion, the below for which I'm grateful)

These are three false statements in a row.

Big congratulations to you.

This destroys any investing advice you could give. A recession makes bankruptcy likely. They sell a niche luxury product, at least two new as yet unmade models of which they must high-end mainstream in the next 5 years to not go bankrupt. That market disappears in a recession.

Basically, TSLA (like Enron and pets.com) have enjoyed ultra-cheap credit, government subsidies totaling in the billions, one of the longest bull markets in history with an even more robust tech bull (a rising tide lifts all boats), and a constantly improving economy (as well as middle class and above wealth to buy their products thanks to the long running bull market giving people more money) all together enabling them to access enough money to survive and build a (as yet very small relative to what they need) capital base. You would have to be extraordinarily incompetent as a businessperson to fail in this environment, even if your business was crap. And indeed, few have.

A change in the business cycle or a meaningful market correction is sufficient to bring this all crashing down.

To put things in perspective, Tesla need at least $100 billion in capital to build out their plants and justify a valuation 30% lower than where they are - that of Ford. To justify a higher valuation, they need many hundreds of billions. They've managed to raise $8 billion so far in one of the biggest bull market in history, with the lowest rates in history, and are now $17 billion in the hole on top of that (ignoring capital holdings, which will depreciate).

I am sure you will appreciate that raising $8 billion via secondaries over a few years in a massive bull market, is largely irrelevant to future capital raises and what they will need.
He's a solid gold bull**** artist and that is extremely valuable - for a while. Pearson (CEO of Valeant until recently) was also one of the best bull**** artists of all time. That ended as badly as Enron. I think people like Musk thrive in bulls and strong economy and with easy/cheap borrowing, and die in bears. Musk has never created a profitable business in his life, even with the billions he's received in government handouts. He made a couple of shrewd investments though in companies that got bought out.
Failure to execute is a near certainty. He's years behind his own schedules and his products are always much more expensive than he claims they will be and he always loses a lot more money on them than he claims he will. History is the best predictor of the future.

His biggest risk isn't even execution, but competition. Once long range high flow batteries are commodities, he's competing against a trillion in capital with no differentiator any more. At the moment he's competing against $0 in capital with a huge differentitator. He's filled a money-losing niche with the only performance electric car. That's about it.

I think the company would be far better off in terms of its execution (not its stock price, certainly) without Musk. He's a liability. But agree on the market impact.
I enjoyed your thoughts. Which way is the knife going if you buy now after it's run up 30% in a handful of weeks? Which knife are you catching?