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So glad I own TSLA!!!

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EPS (non-adjusted) in line after being revised down; growth is slowing, FCF -50%, margins compressing. P/E still ~40.

Serious question - if this was company was NOT associated with Elon Musk, would you buy it?

The CC will be interesting, to see what they dangle in front of investors for the "future".
Buy quality. Keep calm and go long (and note to self STOP SELLING).
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WarrenC12 wrote:
What is Amazon?
AMZN is a consumer discretionary stock, isn't that where most of its revenue comes from? GOOGL/META are communication services, not tech.
TuxedoBlack wrote:
It's not how you start, but how you finish that matters.

You are completely overlooking Tesla's rapidly growing non-car business. And of course, you would: you haven't even driven their cars so are unfamiliar with what they are about.

Of course what they are on pace is absolutely groundbreaking if they were to solve it (talking about FSD). But I am not basing my investment thesis on potential. I am talking about here and now. Tesla makes amazing EVs with huge profits and have enough demand to sell 1.3+M in 2022.

Wait until Cybertruck specs and prices are revealed. Watch the stock price then LOL.
You can keep telling yourself quotes to keep your narrative alive, but you have no idea what will happen in the future.

Now you keep bringing back Tesla's rapidly growing non-car business but never show any numbers. I put the numbers on a spreadsheet to see if what you are seeing is true and while the energy business is growing faster than the car business, it's not making more money and that's before adding operating expenses!

Image

They started reporting energy revenue in 2014 so you have a CAGR between then and now and from the year after the SolarCity acquisition. The energy business hasn't grown faster than the car business since the SolarCity acquisition and neither does it make more money than the car business. Might it change in the future? Sure, but nobody knows.

You can also see that Tesla's revenue will usually jump a lot in the year after they introduce a new car model. Sadly, they don't give a breakdown per car model or by geography so it's hard to know which car model is doing good. We all know why they are doing that.
TuxedoBlack wrote:
Those that think TSLA is still overvalued are the same as those posters here who have been calling for Tesla to fail. They're either shorting the stock or just plain clueless. It's a disruptive tech and the least you can do is go drive the car and experience the software + others before making a judgment call.

Take Roth Capital's Craig Irwin, for example. He thinks that Tesla doesn't have anything that legacy automakers can't do already. LOL. If it was so easy for legacy companies to make software, then they would have done it already.

Craig also totally overlooks the FSD potential and thinks that legacy can easily put in some batteries and an electric motor and have a winning formula. That is not what is happening. Competition is very far behind LOL.

Remind me of this in 3 years when TSLA is at least 2x ($300 in 2026) what it is right now... Even at $150, it appears to be a solid purchase.
You keep talking about Tesla being such a great company, yet if I remember correctly you don't own the stock or plan to buy it unless it drops under 100$? I can't tell if you are an investor or not because what you say vs what you do doesn't match.

One thing you fail to realize and I don't understand what is so hard is not everything is interested in owning a TSLA. Some people like to have a proper dashboard, others like to have physical buttons, others like to have better interiors, others are not interested in having all that technology they won't use in their day-to-day drives, etc. As I mentioned before, at the end of the day it's a car and the goal of a car is to bring you from point A to point B.

FSD is not close to being solved and for the first time since like 2017 even Elon Musk is not mentioning it will be solved by next year.

Now regarding the earnings, I can't wait for the 10Q to be out because there are a lot of things people should be paying attention to and Q1'23 earnings will be important:

Q4'22 margins are going down and that is probably due to the price cut in China. Q1'23 will also include the price cut in many other countries. I haven't listened to the conference call, but it has been mentioned by the CFO that the price for lithium is going up in '23. Knowing margins are going down, Tesla added a section to reassure people that historically even if the ASP has been trending down, their operating margin has been going up. 2022 ASP is around 55k and the CFO has guided for >47K in 2023 with >20% margins.

Management outlook for 2023 is 1.8M deliveries, even if on the call their goal seems to be 2M. If you annualize the Q4'22 run rate (which should be higher due to Austin and Berlin ramping up), you get 1,758,804 cars produced. If their goal is 1.8M, that is a 37.4% growth from 2022. While the growth is good, that is not what people are expecting from Tesla. If they are really aiming for a total of 1.8M car deliveries, their inventory might grow a decent amount which is also not good. The global vehicle inventory (days of supply) is also going up.

Tesla filed an 8K today mentioning they have a 5B unsecured revolving credit facility with Citibank with an option for an extra 2B which expires in 2028 and Tesla can request up to two one-year extensions. Why does a company with 22B in cash and equivalent that grows every quarter need this?

In the cash flow statement, there is a 4,368B purchase of investment and they show cash, cash equivalent and investment of 22,185B. In the 10Q of Q3'22, they showed cash and cash equivalents of 19,532B and short-term marketable securities of 1,575B. If you subtract 4,368B from 22,185B you get 17,817B in cash and cash equivalent and you would need to subtract 1,575B (Q3'22 marketable securities) and add 19M (marketable securities that were redeemed in Q4'22) which should give a cash position of 16,261B, almost 3B less than the previous quarter. The free cash flow this quarter is -49% vs the previous quarter on record earnings. Accounts payable continues to grow faster than account receivable, which help their free cash flow, but they will have to pay that one day. Inventory is also up a decent amount, but since it's not broken down the 10Q should help there. Customer deposits are heading down, will be interesting to see this one in Q1'23 since Elon Musk said on the call they are getting 2x the number of orders vs production (remember, their guidance is 1.8M deliveries this year).

Even though Musk keeps saying they will try to improve services and access to supercharges, the growth rate of those is below their production/delivery rates. Tesla owners better hope there is no major recall that cannot be fixed via OTA.

One of the things that I am the most puzzled with is the fact that they recognized 324$ of FSD revenue, even if it's still in beta. They did not deliver the finished product, so I am not sure how they can recognize that revenue but I am not an accountant. I wonder what happens if they would need in the future to upgrade the hardware on vehicles that they already recognized the revenue on. If they didn't recognize that revenue, they would have missed analyst estimates.

Just some of the things I and other people found out looking quickly at the shareholder presentation and that most Tesla bulls don't seem to pay attention to.
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MoneyHypeMike wrote: AMZN is a consumer discretionary stock, isn't that where most of its revenue comes from? GOOGL/META are communication services, not tech.
Yes selling stuff is a large % of Amazon's revenue, but majority of its profit is from Amazon Web Services.
https://www.investopedia.com/how-amazon-makes-money-4587523 wrote:Amazon’s AWS segment generated net sales of $17.8 billion and operating income of $5.3 billion in Q4 FY 2021. Net sales grew 39.5% and operating income rose 48.5% compared with the year-ago quarter. Although net sales from AWS are below net sales for the North America segment and International segments, AWS’s operating income is substantially higher. The AWS segment accounts for about 13% of total net sales. Because the other two segments posted operating losses in the fourth quarter, AWS accounts for all of the company’s operating income.
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destroyor86 wrote: Yes selling stuff is a large % of Amazon's revenue, but majority of its profit is from Amazon Web Services.
I don't assign the industries so I am not sure what you are trying to point out.

As I mentioned, people compare TSLA to car makers when trying to justify margins but compare it to a tech company to try to justify the valuation and why it should trade at a premium.
It cannot be both and I am not aware of great tech companies that have such low margins and are as capital-intensive as TSLA.
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January 26, 2023 6:59 AM EST
Musk outlines Tesla's recession playbook: claw back costs
https://www.reuters.com/business/autos- ... 023-01-26/

Excerpts;

Part of the plan is expanding production at Tesla's newest plants in Berlin and Austin, Texas and increasing the company’s in-house production of batteries, since scale yields savings, executives said.

...running Tesla factories leaner with fewer materials in inventory, cutting shipping and logistics costs and negotiating lower prices for components, he said

Tesla is also cutting costs by redesigning elements of battery and electric motor systems, removing features that owners are not using, based on data collected from Model 3 sedans and Model Y SUVs on the road
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The market seems to like what Musk was selling at the CC!
Buy quality. Keep calm and go long (and note to self STOP SELLING).
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MoneyHypeMike wrote: I don't assign the industries so I am not sure what you are trying to point out.

As I mentioned, people compare TSLA to car makers when trying to justify margins but compare it to a tech company to try to justify the valuation and why it should trade at a premium.
It cannot be both and I am not aware of great tech companies that have such low margins and are as capital-intensive as TSLA.
It doesn't matter where you assign the company. Any company that is growing at 50%+ year-over-year should have a P/E ratio that is vastly higher than the average company.

MoneyHypeMike wrote:
"You can keep telling yourself quotes to keep your narrative alive, but you have no idea what will happen in the future."
True. I don't know what will happen in the future (did I know that TSLA would go up 40% in less than a month? No I did not.) Neither do you. All we can do is make an educated guess, and my bet is that TSLA has way more room to grow.

MoneyHypeMike wrote:
"Now you keep bringing back Tesla's rapidly growing non-car business but never show any numbers. I put the numbers on a spreadsheet to see if what you are seeing is true and while the energy business is growing faster than the car business, it's not making more money and that's before adding operating expenses!"
LOL. Did you not look at the shareholder's deck? Energy is growing at 152% YoY, vastly exceeding the car business.
Source:
https://tesla-cdn.thron.com/static/GZR0 ... f2a.pdf%22
Page 11
MoneyHypeMike wrote:
"You keep talking about Tesla being such a great company, yet if I remember correctly you don't own the stock or plan to buy it unless it drops under 100$? I can't tell if you are an investor or not because what you say vs what you do doesn't match."
I am no investing genius LOL. If I was, I would've bought it at $102 when it was trading. But I'm a dummy and I tried to follow my plan. No sweat. I'll buy some TSLA stock very soon.
MoneyHypeMike wrote:
"One thing you fail to realize and I don't understand what is so hard is not everything is interested in owning a TSLA. Some people like to have a proper dashboard, others like to have physical buttons, others like to have better interiors, others are not interested in having all that technology they won't use in their day-to-day drives, etc. As I mentioned before, at the end of the day it's a car and the goal of a car is to bring you from point A to point B."
Hmm... so Blackberry also had tons of buttons but iPhone didn't. Now 15 years later, all new smartphones have zero buttons. Why is it? You don't think the car future is headed that way? Meanwhile, because Tesla's cars are easier to produce with no redundant buttons, they are able to produce cars faster. Huge win for Tesla.
You do have a point, however: not everyone wants a Tesla for myriad reasons. The global car market is 80M / year. Tesla wants to sell 20M / year so that's still just a 25% market share. Tesla does not want to, have to, or need to capture 100% market share.

MoneyHypeMike wrote:
"FSD is not close to being solved and for the first time since like 2017 even Elon Musk is not mentioning it will be solved by next year."
FSD may or may not be solved this decade. You are correct in that.
But, my evaluation of the stock is not based on FSD or AI or Robotics. My evaluation is simply based on Tesla making the best EVs, their batteries, and their energy storage business which will be huge. The market isn't pricing all 3 things just yet.

MoneyHypeMike wrote:
"Management outlook for 2023 is 1.8M deliveries, even if on the call their goal seems to be 2M. If you annualize the Q4'22 run rate (which should be higher due to Austin and Berlin ramping up), you get 1,758,804 cars produced. If their goal is 1.8M, that is a 37.4% growth from 2022. While the growth is good, that is not what people are expecting from Tesla. If they are really aiming for a total of 1.8M car deliveries, their inventory might grow a decent amount which is also not good. The global vehicle inventory (days of supply) is also going up."
If you're looking at annualized Q4 '22 run rate, you should compare that with Q4 '23 annualize run rate which we won't know until Jan '24. I bet Q4 '23 annualized run rate will be at least 620K cars per quarter but more like 650K vehicles per quarter. I think Tesla is vastly sandbagging. I have them producing over 2.1M cars in 2023 with sales approaching 2M and having an excess inventory of 100K by year-end 2023.

MoneyHypeMike wrote:
"Tesla filed an 8K today mentioning they have a 5B unsecured revolving credit facility with Citibank with an option for an extra 2B which expires in 2028 and Tesla can request up to two one-year extensions. Why does a company with 22B in cash and equivalent that grows every quarter need this?"
You're now grasping at straws here. What does that have to do with Tesla's profitability???
Here is something I will share: when you have the means, it is imperative to get revolving credits. Because Banks will only give you credit when you don't need it. When you do need it, they won't give it to you. So having 7B revolving credit is actually a good thing. LOL. Face With Tears Of Joy
And to answer your question, all you need to do is some thinking: They can only make 2M cars per year. Their goal is to get to 20M. They will, therefore, need more factories, and those costs money!

MoneyHypeMike wrote:
"In the cash flow statement, there is a 4,368B purchase of investment and they show cash, cash equivalent and investment of 22,185B. In the 10Q of Q3'22, they showed cash and cash equivalents of 19,532B and short-term marketable securities of 1,575B. If you subtract 4,368B from 22,185B you get 17,817B in cash and cash equivalent and you would need to subtract 1,575B (Q3'22 marketable securities) and add 19M (marketable securities that were redeemed in Q4'22) which should give a cash position of 16,261B, almost 3B less than the previous quarter. The free cash flow this quarter is -49% vs the previous quarter on record earnings. Accounts payable continues to grow faster than account receivable, which help their free cash flow, but they will have to pay that one day. Inventory is also up a decent amount, but since it's not broken down the 10Q should help there. Customer deposits are heading down, will be interesting to see this one in Q1'23 since Elon Musk said on the call they are getting 2x the number of orders vs production (remember, their guidance is 1.8M deliveries this year)."
So you can do a good analysis. But again, you're grasping at straws here. Big time.
What does cashflow analysis have anything to do with:
a) profits
b) deliveries
c) EPS

When it comes to stock analysis, there are lots of noise. What one needs to focus are on revenue and its growth, cost control, and ultimately profits. It's the earnings that derive the stock price, as long as the books aren't being cooked.

MoneyHypeMike wrote:
"Even though Musk keeps saying they will try to improve services and access to supercharges, the growth rate of those is below their production/delivery rates. Tesla owners better hope there is no major recall that cannot be fixed via OTA."
Agreed. If there is a major recall, Tesla will tank hard. Thankfully they over-engineer their vehicles and as an owner since June 2020, I have not had any issues that weren't fixed by the mobile tech who came to my home and remotely did all the work. Which other car companies have that? Most car companies also have the dealership network to contend with, which is a huge cost for them. Don't forget the positives when bringing up the negatives.

MoneyHypeMike wrote: "One of the things that I am the most puzzled with is the fact that they recognized 324$ of FSD revenue, even if it's still in beta. They did not deliver the finished product, so I am not sure how they can recognize that revenue but I am not an accountant. I wonder what happens if they would need in the future to upgrade the hardware on vehicles that they already recognized the revenue on. If they didn't recognize that revenue, they would have missed analyst estimates."
What? They haven't fully recognized the revenue yet. Of course they can't as the product itself isn't finished.
Now don't tell me they're cooking the books hahah. The amount of scrutiny Tesla gets is unreal.

Their Balance Sheet is amazing. No other company that I can find has as clean of a balance sheet with so much cash and marginal debt.

They had record production, record deliveries, record revenues, record operating margins, and record profits.

Yet the bears are grasping at straws, trying to look at cash flow to justify that the company will fail. Come on!
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MrMom wrote: ER out

Act $1.19
Act Sales $24.32B

More via CNBC, https://www.cnbc.com/2023/01/25/tesla-t ... -2022.html
Wow. Leave it up to CNBC to turn the positives into negatives!

All I see are records everywhere:
Record production
Record deliveries
Record revenue
Record operating margins
Record earnings & profits
Record EPS

Yet the share price is down 61% from its peak (currently at $157). Go figure.

Here is the thing: the growth story is far from over and Tesla is on pace to grow at a high rate over the next several years, from their car business alone. Add in their battery and energy business, the growth is massive.

(Note, this does not include their FSD, AI, or Robotics business.)

Factor in the growth, do you think the stock is overvalued, undervalued, or trading at a fair value?
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So how much time did Elon even spend overlooking Tesla last quarter considering he was at Twitter basically 75%+ of the time lol. Imagine when he actually steps down as CEO of Twitter.. TSLA will rocket imo.
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MoneyHypeMike wrote: AMZN is a consumer discretionary stock, isn't that where most of its revenue comes from? GOOGL/META are communication services, not tech.
AMZN's cash comes from AWS mostly, that's B2B tech. The consumer (retail) portion is basically flat or losing money for years.

Google and Meta are advertising businesses, that's where the money comes from.
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MoneyHypeMike wrote: I don't assign the industries so I am not sure what you are trying to point out.
???? Pointing out that dismissing where the company is assigned is your biggest mistake.
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Why didn't any shareholders ask if Tesla could get their money out of China properly? Face With Tears Of Joy
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faken wrote: So how much time did Elon even spend overlooking Tesla last quarter considering he was at Twitter basically 75%+ of the time lol. Imagine when he actually steps down as CEO of Twitter.. TSLA will rocket imo.
He said in a Twitter spaces chat that he hasn't missed any significant meetings at Tesla. Tesla is becoming a well oiled machine and won't completely crumble is Elon isn't there to handle every single issue that arises. That's the mark of a good leader, bringing in people who can step in and take over at a moment's notice if Elon gets hit by a bus or is taken back to his home planet suddenly! :)
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Just one big piece of caution that can deter Tesla significantly - FSD Hardware (Potential Lawsuit?)

I dont believe FSD is possible on current hardware. Especially to the point of Robotaxi etc.

Elon and Tesla have been continually saying that "All cars from the end of 2016 on wards come with the hardware required to achieve Full Autonomy"

There was a question on the call yesterday pertaining to the upcoming HW4.0.

Elon acknowledged there will be an HW4.0, said it would be too costly to do the upgrade to HW 3.0 cars and below. He continued to claim HW3.0 will be 2x better than human drivers, and HW4.0 will be 4-5x (can't remember the number) and supposedly thats the only difference.

If it comes out that Musk is full of sh** (which we all know he is), and Tesla is forced to upgrade all existing vehicles to HW4.0 as a result of a potential lawsuit (given that they claimed all cars have all the hardware for FSD)...

This could have a material impact to the financials.
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WarrenC12 wrote: AMZN's cash comes from AWS mostly, that's B2B tech. The consumer (retail) portion is basically flat or losing money for years.

Google and Meta are advertising businesses, that's where the money comes from.
You seem to be mixing cash and profit.

AMZN profits, when they have some, come from AWS.

Cash is not equal to profit, a classic mistake.

You are free to contact whoever assigns industries to make them change if you are not happy with the one TSLA has been assigned to.
Last edited by MoneyHypeMike on Jan 26th, 2023 12:46 pm, edited 1 time in total.
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Also - Tesla may soon move away from the "we don't advertise using traditional methods" message.

Despite Elon voicing his hatred towards the FB group of company's...and his overall hatred for traditional advertising...

SpaceX has started advertising on Instagram!

I wouldn't be surprised if Tesla soon follows (once this initial boost in sales from the price cuts tapers off - Maybe H2 2023?)

.
IMG_0296.PNG
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exrcoupe wrote: if Elon gets hit by a bus or is taken back to his home planet suddenly! :)
You mean Mars? Face With Stuck-out Tongue And Tightly-closed Eyes

Elon Musk's first name shows up in 1953 book about colonizing Mars
In the 1950s, German-turned-American scientist Wernher von Braun (yes, the Nazis' leading rocket man), wrote a science fiction novel called The Mars Project. It takes place in then-distant 1980 and features human colonists on Mars whose leader uses the title "Elon."
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deal_with_singh wrote: Just one big piece of caution that can deter Tesla significantly - FSD Hardware (Potential Lawsuit?)

I dont believe FSD is possible on current hardware. Especially to the point of Robotaxi etc.

Elon and Tesla have been continually saying that "All cars from the end of 2016 on wards come with the hardware required to achieve Full Autonomy"

There was a question on the call yesterday pertaining to the upcoming HW4.0.

Elon acknowledged there will be an HW4.0, said it would be too costly to do the upgrade to HW 3.0 cars and below. He continued to claim HW3.0 will be 2x better than human drivers, and HW4.0 will be 4-5x (can't remember the number) and supposedly thats the only difference.

If it comes out that Musk is full of sh** (which we all know he is), and Tesla is forced to upgrade all existing vehicles to HW4.0 as a result of a potential lawsuit (given that they claimed all cars have all the hardware for FSD)...

This could have a material impact to the financials.
FYI, I recently got my HW2.5 Camera to HW3 Camera by Tesla on the house.
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exrcoupe wrote: He said in a Twitter spaces chat that he hasn't missed any significant meetings at Tesla. Tesla is becoming a well oiled machine and won't completely crumble is Elon isn't there to handle every single issue that arises. That's the mark of a good leader, bringing in people who can step in and take over at a moment's notice if Elon gets hit by a bus or is taken back to his home planet suddenly! :)
Funny how no one ever asks how much time Tim Cook spent at Foxconn factories overseeing iPhone/iPad/airpods production.

But this stock is just wild. Now up almost 60% in three weeks. It should never dipped to $100 in the first place. Just shows how irrational the market is.

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