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The selloff in Tesla (TSLA -14.5%) gathers momentum following Goldman running the numbers and...

The selloff in Tesla (TSLA -14.5%) gathers momentum following Goldman running the numbers and finding the stock deserves its valuation only in the best of scenarios. Volume in the shares today looks like it will end up at about 4x the average level.
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Comments (57)
  • captiankirkoptions
    , contributor
    Comments (236) | Send Message
     
    Finally someone attempts to do some halfway realistic math.
    16 Jul 2013, 03:13 PM Reply Like
  • joenjensen
    , contributor
    Comments (705) | Send Message
     
    Watch out for the bounce, do you want to miss the move up again?
    16 Jul 2013, 05:46 PM Reply Like
  • Agnes59
    , contributor
    Comments (437) | Send Message
     
    All the other negatives articles against tsla, they finally brought in the big gun. In my opinion this is no different than any other hype out there to bring down the stock.
    16 Jul 2013, 07:53 PM Reply Like
  • joenjensen
    , contributor
    Comments (705) | Send Message
     
    You call Goldman Saks a big gun? Didn't that company sell loans to people that should have never borrowed back in 2007-2008? Weren't they one of the companies responsible for the mess we got in in those years and we aren't out of it yet?
    If they were one of these, don't you think they have lost credibility with you?
    They did with me, because when a big company lies, cheats, steals people's money, how can you trust whatever they say?
    17 Jul 2013, 09:55 AM Reply Like
  • Esekla
    , contributor
    Comments (3978) | Send Message
     
    It will be interesting to see if the same market figures that were useful an predicting the size of the short squeeze will be applicable on the way back down. I'm not so sure that will be the case...
    16 Jul 2013, 03:15 PM Reply Like
  • EatMyVoltage
    , contributor
    Comments (66) | Send Message
     
    While there's certainly some truth to the Goldman analysis, there are other things to consider. The Model S is superior to the Mercedes S-Class, the BMW 7 series and the Audi A7. If subsequent Tesla models are also that much better, those projected sales figures could be low. Also consider Europe where the consciousness about fossil fuel pollution is much higher, and the financial incentives to own an electric car are also much higher. And note that 500 Model S's are on the boat to Europe now. Not to mention China and the rest of Asia.

     

    The numbers also don't consider the perception of the company. Certainly most investors are only concerned about the money. But there's a percentage of investors who are also concerned about the planet and mankind. They won't invest in fossil fuels (BP and the Gulf of Mexico), tobacco (where do I start?), drug companies, or Wall Street firms that actively work against their clients (see Goldman Sachs and Paulson).
    16 Jul 2013, 03:24 PM Reply Like
  • ciolan
    , contributor
    Comments (193) | Send Message
     
    "The Model S is superior to the Mercedes S-Class, the BMW 7 series"

     

    =))
    wait, there's more:
    ahahaha
    16 Jul 2013, 03:39 PM Reply Like
  • RUCE88
    , contributor
    Comments (55) | Send Message
     
    Mr Ciolan,
    Have you actually driven a Model S? My guess is you have not.
    So are you laughing at yourself?
    16 Jul 2013, 03:52 PM Reply Like
  • Piptief
    , contributor
    Comments (975) | Send Message
     
    There is no way a car that hasn't withstood the test of time can be said to be better than the BMW and Merc...we have no reliability data for the Tesla to speak of...strongly disagree
    16 Jul 2013, 04:02 PM Reply Like
  • EatMyVoltage
    , contributor
    Comments (66) | Send Message
     
    For all the statements there are about Tesla, calling it better than those cars is the easiest to prove out :) Motor Trend's Car of the Year for 2013. And this is the only time that a car won that award UNANIMOUSLY. Or Consumer Reports calling it the best car they've ever tested. Can anyone name another car that has been so highly reviewed and awarded? Also true is that you can ask any Model S owner and they will tell you it's the best car they've ever owned. And many of them have become evangelists for the car and the company. And if they've paid ~ $100,000 for a car, they also might be investors fueling demand for the stock.

     

    And how much can you believe Goldman Sachs? It is ironic that a former VP at Goldman stands trial today for misleading investors for personal gain. And why isn't Goldman Sachs on trial? Oh yeah, they already admitted their mistakes and paid a $550 Million dollar fine.
    16 Jul 2013, 04:40 PM Reply Like
  • robfol
    , contributor
    Comments (4) | Send Message
     
    Driven all three and the Tesla is stunning. Also far less to go wrong and not as if Merc and BMW are paragons of reliability
    16 Jul 2013, 05:02 PM Reply Like
  • Rik1381
    , contributor
    Comments (1418) | Send Message
     
    Motor Trend, Automobile Magazine and Consumer Reports said the Tesla Model S is better than the Mercedes S class.
    16 Jul 2013, 05:05 PM Reply Like
  • joenjensen
    , contributor
    Comments (705) | Send Message
     
    Read Consumer Reports and Motor Trend, they have said there isn't ANY car (including a BMW or a Merc) on the road that's better than Tesla, read it and weep.
    16 Jul 2013, 05:50 PM Reply Like
  • aeroguy48
    , contributor
    Comments (759) | Send Message
     
    Who reads Motor Trend?
    16 Jul 2013, 07:43 PM Reply Like
  • InvestorGuru
    , contributor
    Comments (6) | Send Message
     
    http://cnnmon.ie/17jHYep

     

    I'd rather own a BMW or Mercedes considering I couldnt drive my Tesla in more that 10 cities til next year if all goes well with their CAPEX. The stress of finding and waiting at a charging station is just not something I would want to add to my life. Plus BMW and Mercedes are both good for long distance trips where the TSLA is only good for those who can afford a car that is good for purely getting around town. I think if you like convenience and a car with range for longer road trips I dont think the Tesla is for you.
    16 Jul 2013, 08:44 PM Reply Like
  • jpanasewicz
    , contributor
    Comments (8) | Send Message
     
    I have a Model S and have driven some damned fine German metal. I was a serious Audi guy until that defining moment when I pushed the "go pedal" on the test Model S and heard nothing as the speed came on so smoothly. So many more moving parts in an ICE; so much more that ultimately needs TLC or a lot more.

     

    As for the TSLA stock, good luck with predictions! I think it's safe to say that the markets aren't entirely efficient; some players have bones to pick and agendas to run...and many of those players have a lot more capital available to push the rest of us around. I'll enjoy my car! (8,000 miles in only four months!)
    16 Jul 2013, 08:49 PM Reply Like
  • ejhickey
    , contributor
    Comments (122) | Send Message
     
    you are driving too much. get out of your car and take a walk
    16 Jul 2013, 11:12 PM Reply Like
  • Johan1952
    , contributor
    Comments (34) | Send Message
     
    Actually 400 model S are sold PER WEEK in Europe !! Next week Showroom in Brussels ==> all the Eurocrats with their pockets full of money and their eagerness to distantiate from the plebs are possible buyers !
    17 Jul 2013, 03:15 AM Reply Like
  • joenjensen
    , contributor
    Comments (705) | Send Message
     
    Like I said, maybe you should read it and weep!
    17 Jul 2013, 10:01 AM Reply Like
  • joenjensen
    , contributor
    Comments (705) | Send Message
     
    That's right, (I gave you a like) Goldman Sachs can not be trusted with what our Government says, not me because they fined them for doing what they did back in 2007/8.
    P.S. Today is the day after tsla went down over 18, and it's UP over 7 points and I expect it will get every dime back today or in the next few, so to all shorters...stop shorting, break down and buy it.
    17 Jul 2013, 10:20 AM Reply Like
  • cesartoro
    , contributor
    Comments (38) | Send Message
     
    Model S have this beatifull roooarrr sound of 12 cylinders working together... Tesla S have this NEW Startrek futuristic quiet screaming that whisper to your ears (im the future). Greetings from Venezuela!!!
    17 Jul 2013, 11:30 AM Reply Like
  • cesartoro
    , contributor
    Comments (38) | Send Message
     
    Nobody, they just exist because governement pay it... xD
    17 Jul 2013, 11:33 AM Reply Like
  • Deja Vu
    , contributor
    Comments (1602) | Send Message
     
    TSLA $110 strike July 20 Expiration. Closed yesterday at 0.02 and opened today at 0.05. Currently trading at $4.70. A nice 23500% gain for anyone buying yesterday. A mere 9400% gain for anyone buying it this morning. Writing option contracts can be dangerous to your financial health.
    16 Jul 2013, 03:30 PM Reply Like
  • Glenn Abrett
    , contributor
    Comments (1956) | Send Message
     
    Deja Vu -- Yep -- Do you know Paulo Santos -- usually the uber-bear about everything -- doesn't like tesla much -- doesn't like anything, imagines the stock market is one big bubble, Back in the early spring before the stock exploded he noticed that there was pretty much zero time value to tesla options. If you bought, say, August 32's when tesla was at 35, the options cost like $3.40 or something totally absurd. Paulo noted that tesla was about to enter a period a volatility and that the low time premium was simply the rare occasion where the market priced something wrong.

     

    Well, I followed Paolo's advice (would that I had held onto those August 32's all the way up) started playing the options game a bit -- made far, far more money in the past 2 months playing tesla options, against all my own advice of not worrying about the short term, than have made investing for the past year -- quite exciting -- an adrenaline rush like no other.

     

    Hope you had some of those july puts. a Hundred would have cost $200 and now be worth 47,000. I did think of hedging my long position that way -- even advised doing so here -- but could not bring myself to pull the trigger -- sigh -- can't win em all.
    16 Jul 2013, 09:07 PM Reply Like
  • Deja Vu
    , contributor
    Comments (1602) | Send Message
     
    I totally remember Paolo Santos's article.
    17 Jul 2013, 08:18 AM Reply Like
  • Miro Kefurt
    , contributor
    Comments (698) | Send Message
     
    Looks like TSLA got chirpies, but wait it's tweetable !!!
    16 Jul 2013, 03:55 PM Reply Like
  • madhaus
    , contributor
    Comments (153) | Send Message
     
    BUYING opportunity. Going in. Again.
    16 Jul 2013, 04:12 PM Reply Like
  • PatPatterson
    , contributor
    Comments (46) | Send Message
     
    Goldman's numbers were wonderful news if you really look at them; only his conclusions as to value (what does he or any other analyst in the world know about "value"?) sucked. His base case of $5.99 (don't you love those exact figures?) in earnings is the WORST case? Hallelujah! Please, don't throw me in that briar patch! Bullish case, implied earnings of $12+. Don't know in what universe investors will only pay 16 to 7 times those earnings. His "error" (in my judgment): the 20% discount rate. I don't know why one would discount those earnings at anything more than the average rate of return on equities.
    16 Jul 2013, 04:19 PM Reply Like
  • Meleke Capital Management
    , contributor
    Comments (10) | Send Message
     
    Finally... they just scratched the surface on the sales trends.. more holes down the income statement
    16 Jul 2013, 04:19 PM Reply Like
  • Joe Dirnfeld
    , contributor
    Comments (1128) | Send Message
     
    Can't even forecast the weather out a week, though he can figured
    The value of tesla.
    16 Jul 2013, 04:19 PM Reply Like
  • Alexander-the-Great
    , contributor
    Comments (36) | Send Message
     
    The history on Goldman Sachs on what they say and what they do is very interesting. I would do the opposite of what Goldman is now saying. Too many people want Tesla to fail, it is a disruptive technology that will change the energy industry. The threat is to Exxon, Shell, Texaco, BP etc......
    16 Jul 2013, 04:20 PM Reply Like
  • joenjensen
    , contributor
    Comments (705) | Send Message
     
    Yeah....isn't that great? My Grandchildren just might be able to breath better with cleaner air, only if these greedy bastards don't wind up killing the whole concept. That's what worries me, American Greed.
    16 Jul 2013, 05:56 PM Reply Like
  • Glenn Abrett
    , contributor
    Comments (1956) | Send Message
     
    Joe -- hate to go off topic, but it is American greed that has built the world you live in. The internet. The mobile phones. The telephone and the airplane and the personal computer, not to mention television and radio, the phonograph and movies. Hell, it was probably cave man greed that got you fire and egyptian greed that got you the wheel. Certainly it was roman greed that got you indoor plumbing.

     

    We live in the greatest time for the human race there has ever been, in the most incredibly creative part. Even seems like there are more 'good' corporations, like Tesla and Google. But don't kid yourself. All corporations are totally, 100% greedy. Anyone thinks EM's goal is to save the world has a screw loose. EM is the greediest of them all -- wants to be the richest man on the planet and has a real good shot of reaching that goal.
    16 Jul 2013, 09:13 PM Reply Like
  • joenjensen
    , contributor
    Comments (705) | Send Message
     
    My point wasn't against all corporations, just Goldman Sachs, and what bothers me Glen is that Goldman bad mouthed Tesla after they were eating with two hands back in 2008/7, and gave out loans to people that should have never received one, then on the other side of their mouth they bad mouth Tesla causing the stock to go down falsely?
    Did you think that was right? Did you think Goldman had lost credibility with you? Did you believe any of that Goldman greedy garbage?
    If you didn't then you got my point the first time.
    17 Jul 2013, 10:37 AM Reply Like
  • Glenn Abrett
    , contributor
    Comments (1956) | Send Message
     
    GS is totally evil. Reminds me of a t shirt I used to wear. "I do very bad things, but I do them very well." I do not like financial institutions much in general. They are no greedier and no more amoral than any other company, but they don't seem to provide much value to society at large while skimming off huge amounts of money -- parasites, for the most part though that was not always the case -- before the internet they provided services that were absolutely needed but now I fear their time is ending. GS is amusing because they are the most brazen.
    17 Jul 2013, 11:25 AM Reply Like
  • Gordonr
    , contributor
    Comments (1626) | Send Message
     
    Let us not forget this is the same Goldman that was pushing mortgaged backed securities as good investments, all the while dumping them out the back door. Those immoral crooks have no credibility in my book.
    16 Jul 2013, 04:31 PM Reply Like
  • JimPaul46
    , contributor
    Comments (27) | Send Message
     
    So, if GS came out tomorrow and said oops we are wrong, BUY ! We reviewed our thinking . Alexander etc would then become sellers ?
    I don't think so. AtG , it is what it is, down 18% in 2 days after a big run.
    Probably will touch 90 before seeing 120 again.
    That's the way it goes in high volatility, low earning stocks.
    See the internet craze from 1999, people said exactly the same things about the stocks they loved and lost on.
    Be well and HEDGE.
    16 Jul 2013, 04:44 PM Reply Like
  • PeterJA
    , contributor
    Comments (4275) | Send Message
     
    For those who are unaware, SA has banned further contributions from Julian Cox (http://bit.ly/1aqDnJa), for reasons they will not specify to him or me.

     

    Anyone interested in Julian's analysis of Goldman's strategy behind today's announcement can find it at the link below. Please note that it was written earlier today before Tesla announced their Q2 earnings report will come on Aug 7, not July 22 as Google Finance has been saying.
    http://bit.ly/1aqDnJc
    (near the bottom of the page)
    16 Jul 2013, 04:53 PM Reply Like
  • samuel.kirz
    , contributor
    Comments (83) | Send Message
     
    Here's the Julian Cox note, copy pasted.

     

    here is something I would thinks was a good idea to have put on Seeking Alpha today. Probably here: http://seekingalpha.co...

     

    Permission to copy and paste universally granted.

     

    Today TSLA has taken a tremendous dive off what appears to be the back of a Goldman Sachs UPGRADE from $60 to $84.

     

    Their GS best case scenario gives a PT of $120 - about par with TSLA prior to the report, which allows GS the opportunity to be right:

     

    http://bit.ly/12GqVyL

     

    Coincidentally the GS best case scenario corresponds directly to data points that fit a pattern of conservative guidance from Tesla. Having covered for credibility with their best case, GS are masters at understanding the actual impact of their actions with regards to sentiment.

     

    It cannot be ignored that GS is both Bank and Bookmaker for Musk / Tesla and it's last intervention was to selectively sell shares and bonds as part of a $1.08bn fundraiser to institutional longs, most likely GS clients.

     

    The outcome, and seemingly the intention of that move was to deny liquidity for short-covering and in so doing exacerbating a short squeeze. It is highly improbable that GS has changed either its allegiances or its mode of conduct towards either Tesla or its own clients so soon after the last offer and so shortly before the 22nd July Tesla Q2 earnings call at a time when GS itself could be criticized for harming its own credibility as bookmaker for the stock in the case of its own analysts triggering a net sell-off just weeks later. That just is not what is happening here, particularly when the 22nd July, stands firmly as a damage limiter. As a matter of fact it looks as though the slide (jitter) has bottomed regardless at around $108.

     

    Of note in this GS piece is the absence of any short-term
    prognosis, specifically any mention of Q2 profit or loss. This is telling when without doubt following the comments let slip by Jerome Guillen at Teslive over the weekend, Tesla will in fact produce a modest profit overturning the analyst-consensus of a small Q2 loss.

     

    In essence this GS article looks true to form a carefully crafted measure to lure shorts into the stock ahead of a
    hail of Q2 analysts beats, thereby rewarding GS clients handsomely at the cost of the comparatively ill informed shorts and skeptics with another significant short-squeeze.

     

    This is a significant buying opportunity for the well informed for double digit gains in the space of 7~10 days with very high levels of certainty attached.
    16 Jul 2013, 05:52 PM Reply Like
  • PeterJA
    , contributor
    Comments (4275) | Send Message
     
    Postscript to Julian's analysis. He just sent me the following:

     

    There is really no reason for shorts to get too irrationally exuberant
    about the Goldman Sachs report (actually an upgrade from $60 to $84 with a backside covering statement at $120).

     

    This is actually much better reason for shorts to be afraid. Very afraid.
    Especially if you stop and look at the fundamental data (of Goldman Sachs).

     

    http://bit.ly/1aqPfuT

     

    Can you see who else just increased their position in TSLA by $100 Million?

     

    That's right. The same people who materially helped to mastermind the last short squeeze.

     

    GS is not about to burn Tesla; they are in the business of burning Tesla shorts.
    16 Jul 2013, 06:33 PM Reply Like
  • Glenn Abrett
    , contributor
    Comments (1956) | Send Message
     
    PeterJA -- I imagine Julian was banned because he was probably less, shall we say politic than myself when SA refused to publish one of his articles.

     

    I wrote a rather balanced though positive tesla article -- and they refused to publish and gave me an insulting bunch of baloney as a reason. I have been back and forth with Eli the editor in chief. If they don't publish my article I am totally gone from this forum. I might even take things up with the SEC.

     

    I believe that most of the short articles -- especially by logical thought -- are SA articles -- was feeling paranoid about SA and Tesla -- the fact that they banned Julian makes me more than paranoid.

     

    Perhaps we should all blow this forum. Plenty of other places.
    16 Jul 2013, 09:18 PM Reply Like
  • PeterJA
    , contributor
    Comments (4275) | Send Message
     
    Glenn, I've urged Julian to find a new venue for his TSLA writing. I'd love to see your article too. Find or make a better venue and I will join you in exiting this one.
    16 Jul 2013, 10:22 PM Reply Like
  • tomfrompv
    , contributor
    Comments (5841) | Send Message
     
    Or, one can apply Occam's Razor and simply realize the guy was obnoxious, bullied people with endless insults, and helped create a very poisoned environment.

     

    Look at what I had to endure, not to mention people who spent a lot of time creating articles.

     

    SA can't have that kind of environment if its going to succeed.

     

    Plus, you have that whole "I've stood in the shoes of Elon Musk" stuff. Thats just weird, if not a touch megalo-manic.
    17 Jul 2013, 12:44 AM Reply Like
  • James Peartree
    , contributor
    Comments (120) | Send Message
     
    Glenn, give me your choice of other places. I'm in the mood!
    17 Jul 2013, 03:12 AM Reply Like
  • Esekla
    , contributor
    Comments (3978) | Send Message
     
    I'm glad if SA is rejecting most article submissions on Tesla. It's a way for authors to make a few $, given the commentary that such articles generate, but most of that commentary detracts from the level of intelligent analysis that this site aspires to, and TSLA is rather over-covered in any case.

     

    If one has a unique insight, that's one thing, and certainly the editors here have a very tough job that doesn't always allow them to sift or respond as well as we might hope. I believe SA will only flourish by publishing less opinion and more QUANTIFIED analysis, though, and that means more aggressive culling than we have seen recently. The rewards they've been adding to move compensation away from a strict page view model are a potentially transformative step in this direction also.
    17 Jul 2013, 08:18 AM Reply Like
  • Glenn Abrett
    , contributor
    Comments (1956) | Send Message
     
    Which is what bothers me. Although I do tend to get a little over the top about tsla in these comments -- its like the girl you just had great sex with -- you imagine all sorts of positive things about her and for awhile think she's the greatest girl in the world -- the article is totally quantitative with, as far as I could tell, zero hype or religious fervor. Unlike a number of recent tesla articles, both long and short, which are either absurdly positive or negative with no substance whatsoever. The case for tsla is a long case. A very long case. And a risky case. I haven't seen any substantial articles here about tesla that make a tentative long case based on the actual circumstances of the company and how they might evolve in the future.
    17 Jul 2013, 11:31 AM Reply Like
  • dban10@gmail.com
    , contributor
    Comments (4) | Send Message
     
    Goldman downgraded SCTY less then a month before giving them $500 millions. Goldman said keep buying stocks right before the Fed meeting and the correction. Goldman said short gold and now they are telling investor not to. Goldman lends $150 millions to Elon Musk to buy more Tesla Motors stock. And now it downgraded the company. It sound to me like Goldman Sachs is trying to manipulate stock prices again and trigger another massive short squeeze.
    16 Jul 2013, 05:03 PM Reply Like
  • PeterJA
    , contributor
    Comments (4275) | Send Message
     
    Yes, that is Julian Cox's conclusion, based on other data.
    http://bit.ly/1aqDnJc
    (bottom of page)
    16 Jul 2013, 05:30 PM Reply Like
  • dkane
    , contributor
    Comments (9) | Send Message
     
    Let's see, looking at a couple recent "analyst" estimates:

     

    - 2 weeks ago Elaine Kwei of Jefferies raised her price target to $130
    - Yesterday, Colin Rusch of Northland Securities raised his to $230
    - Today Patrick Archambault of Goldman Sack says $84

     

    Glad to know these financial wizards have our backs.
    16 Jul 2013, 05:06 PM Reply Like
  • George McDermand
    , contributor
    Comments (53) | Send Message
     
    (in response to the Goldman Jewish comment since removed)
    My mother is Jewish (she married a Scot) and most of her family was killed by the Chancellor in Germany in the late 30's and early 40's. She raised my brother, sister and I in the finest most disciplined tradition. Education was the only thing that mattered. We also were raised with the idea that our education was to be used with compassion and with an eye to the public good. That being said, If you look at the Neocon's with great influence at the US state department for the last 30 years it does look like a Bar Mitzvah guest list. These architects of horror make a mockery of the values we were taught. In my view so many of us have used our education and discipline for selfish purposes. Sadly the education I was taught to treasure has not resulted in the enlightened approach to science, politics nor finance I so desired. And for that I am truly disheartened.
    16 Jul 2013, 05:38 PM Reply Like
  • PeterJA
    , contributor
    Comments (4275) | Send Message
     
    Knights and knaves come in all colors and creeds. To generalize from some to all people of the same heritage seems a reliable sign of low intelligence.
    16 Jul 2013, 06:17 PM Reply Like
  • farstud
    , contributor
    Comments (224) | Send Message
     
    Goldman says sell? The question is then, how much of TSLA are those crooks buying tonight?

     

    SMH. Can't believe 'people' listen to these guys still.
    16 Jul 2013, 07:03 PM Reply Like
  • San Diego Tesla Fan
    , contributor
    Comments (24) | Send Message
     
    I wish there existed an analyst (with clout - a la GS) who was truly independent in fact and appearance and who wasn't putting forth projections which were intended solely to accomplish a movement in the market - either up or down. Some have suggested GS wants to create another short squeeze by drawing in more shorts. Maybe. Who knows? I have been a CPA since 1973 and I do know this: Projections are numbers created by the mind of the person doing the projections and that person can make them show whatever suits his/her purpose...and then rationalize his/her conclusions with formulas, statistics, economic data, whatever....but they're just as imaginery as the square root of -1 and should be considered nothing but propaganda.
    16 Jul 2013, 08:50 PM Reply Like
  • Agnes59
    , contributor
    Comments (437) | Send Message
     
    Ditto!!! Excellent summation, thank you.
    17 Jul 2013, 07:31 AM Reply Like
  • Glenn Abrett
    , contributor
    Comments (1956) | Send Message
     
    Here are some things that likely are true:

     

    1] GS gave an honest appraisal of their view on tsla. They actually became more bullish.
    2] Their view was for the intermediate term, not the long term.
    3] Tesla is unlikely to make enough profit over the next 3-4 years to justify their current market cap.
    4] Even so, if you look further down the road, you see a company with such vast upside that it outweighs the very real risk of it never making it over the hump and the stock falling far below where it is today.
    5] No one can predict what tsla the stock will do tomorrow, this week, this month or even for the rest of the year.
    6] If you bought at 35 or so, like I did, hopefully you have, a month ago or more, sold some to rebalance your portfolio -- No matter what you think -- bull or bear -- we can all agree that tsla is a volatile and risky play -- one that should not have more than a modest portion of your portfolio.
    16 Jul 2013, 08:54 PM Reply Like
  • tradewin
    , contributor
    Comments (632) | Send Message
     
    I heard an old saying once. When the game is over, the king and the pawn get put back into the same box. I think that goes for court jesters as well.
    16 Jul 2013, 11:55 PM Reply Like
  • kuala1
    , contributor
    Comments (25) | Send Message
     
    The Tesla story is very simple:
    - on the plus side you have: breakthrough technology, amazing car (so far at least), i.e. this is potentially a disruptive technology that changes the car industry
    - on the negative side you have: small production volume, significant subsidies (currently around $45k per Model S I believe), significant uncertainty around long term life of the car and battery
    IN other words, on the one hand you might have something that soon makes petrol engine Mercs and BMWs obsolete. On the other hand you might just have a niche/boutique car company, whose cars should really be selling for 50% more, that has a lot to prove both in terms of ability to scale up, and in terms of brand quality and marketability over the long haul. Not to mention the whole question of the need for electric cars given all the shale boom going on and the likely impact on cost of the entire energy complex over coming years.

     

    That said, even assuming the best case scenario, the problem is the share price is too high. When Apple stock was at $700 and it was only on a PE of around 15x or so. Tesla is just up at the moon, and they are not even profitable yet. At worst, investors may lose everything, at best, it's likely to be a VERY bumpy ride from here, with downs to make you groan, and ups to make you squeel. Belt up for the ride. But short term, it looks more like a downer than an upper! I'd bet on going back down to $60-80 before the next major leg up.
    17 Jul 2013, 03:12 AM Reply Like
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