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  • Tesla Motors: A Pause For The Cause 3 comments
    Aug 14, 2013 2:03 PM

    What the excitement around Tesla Motors (NASDAQ:TSLA) is telling us is that we are witnessing a transformation in the transportation and corresponding energy industry at long last and Elon Musk is largely the one spearheading it. Lets take a look at Hyperloop:

    Well, I think the rendering sure looks like a ride on a futuristic rollercoaster in space. The stock seems to be taking a pause from its meteoric rise since the beginning of the year. We think it's partially because of the increase in short interest in the name which crept up by ~ 1.3 million shares in the two week period from July15 to July 31:

    We think that some investors may be concerned that he may lose focus on TSLA because of the Hyperloop project which has gotten a lot of ink lately. An excerpt from a recent CNBC article: Many questions surround Elon Musk's proposal for a super-high-speed Hyperloop transportation system that would use air cushioning to send passengers through a tube between San Francisco and Los Angeles in just 30 minutes.

    The biggest question is whether it will ever get built. There are lots of opinions on that one, but no definite answer yet.

    One question that it appears can be answered now, however, is being asked by plenty of people outside the scientific community: "Wouldn't the people inside the capsule traveling through the tube at hundreds of miles an hour get crushed by high G-forces?"

    The answer is no, and the explanation involves relatively simple physics.

    According to John Lindner, professor of physics at The College of Wooster in Ohio, "If Hyperloop works as planned, for most of the trip the passengers would move at constant velocity in a sealed container, so it would feel like riding a plane or train."

    That's because G-forces, the sensation of pressing weight that's familiar to anyone who has taken a roller coaster ride, are the result of acceleration, not just speed.

    But in the long run, with the game changing vision Elon has, isn't taking a breather from the acceleration of TSLA stock as the shorts pile in worth the net benefit the Hyperloop would provide to our way of life. We certainly think so, thanks Elon.

    Disclosure: I have no positions in any stocks mentioned, but may initiate a long position in TSLA over the next 72 hours.

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Comments (3)
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  • Mongoose7916
    , contributor
    Comments (233) | Send Message
     
    Highly recommend not starting a position in TSLA. Its a bubble.
    14 Aug 2013, 02:23 PM Reply Like
  • Tufenk
    , contributor
    Comments (935) | Send Message
     
    Author’s reply » So was Netfllix, then it crashed and came back, why? Because it was a disruptor as is Tesla. Be careful shorting it, it smoked a lot of smart people.
    14 Aug 2013, 02:26 PM Reply Like
  • Mongoose7916
    , contributor
    Comments (233) | Send Message
     
    I'm not shorting it. And I agree this could be a buy at certain level but that level is not anywhere close to the 130s it is currently at. Even looking at this thing before 90 is scary. Just because there is a lot of people shorting something doesn't necessarily wrong and TSLA has gotten way out in front of itself in terms of its stock price and anyone recommending it is a possible buy at these levels is essentially saying that a stratosphere p/e is justifiable which remains to be seen. This stock is priced for perfection not only does the company have to be perfect and not have any bad news but there also can't be any broad market bad news as well. If someone is interested in TSLA they should wait until its price is at the level in which they made their secondary offering at. The other thing that people have to realize is this was a battleground stock for a long time before it became a raging bull stock it is much more likely this stock will go back to being a battleground stock than back to being a bull stock after the up coming correction.
    14 Aug 2013, 02:37 PM Reply Like
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