Seeking Alpha

Tesla Motors races higher again, $175 and counting

  • Tesla Motors (TSLA +5.6%) sets a new all-time high after a ringing upgrade from Deutsche Bank sets the bar for expectations even higher.
  • The ever-active Twitter account of Tesla CEO Elon Musk could be adding to the frivolity a bit as well. Musk tweeted that he welcomes GM's entry into the long-range EV market and requested that engineers ready to push the pedal to the metal on self-driving technology apply to the company lickety-split.
  • Shares of Tesla hit a high-water mark of $175.65 in intra-day trading, but the day is still young.
Comments (51)
  • Mark Krieger
    , contributor
    Comments (3795) | Send Message
     
    buy the dip and sell the rip...sooner than later, the euphoria will wane
    19 Sep 2013, 11:04 AM Reply Like
  • antiguajohn
    , contributor
    Comments (72) | Send Message
     
    Hi Mark Krieger,

     

    As John Maynard Keynes implied, sooner or later we are all dead;-)

     

    Don't hold your breath,

     

    antiguajohn
    19 Sep 2013, 12:57 PM Reply Like
  • Michael Bryant
    , contributor
    Comments (5368) | Send Message
     
    Mark:

     

    I thought about that. Just make sure you make more than the commissions and taxes.
    19 Sep 2013, 01:28 PM Reply Like
  • joeinslw
    , contributor
    Comments (84) | Send Message
     
    I have been reading these short comments for 3 years, it looks like it might go down, and it will for a short spell, and then.........tsla just goes VAROOOOOOMMMMMMM, leaving every other car company including GM in the dust. Like Elon I'm glad that GM is getting into the EV market, because that's what America needs to get away from the oil grip around our throats and wallets, but they really don't have a leg to stand on when their EV's are compared to the Model S.
    All I can say is keep wishing, but it really doesn't work.
    19 Sep 2013, 04:31 PM Reply Like
  • Dan Fichana
    , contributor
    Comments (1798) | Send Message
     
    Musk is the master of PR, he knows GM can not do it currently or in the foreseable future. Instead of saying it can't be done by them for the 35 K price, he set acknowledges GM said it and when the Gen III comes out he'll say he beat GM to market, or GM will rush a half finished car out to compete, or they will lose money trying to compete.

     

    GM is like the school braggart who says they can hit the ball over the fence every time they are at bat... Musk just invited them to play a game of baseball and call them out.

     

    Bravo Mr Musk Bravo.
    19 Sep 2013, 11:25 AM Reply Like
  • SharkDude
    , contributor
    Comments (553) | Send Message
     
    Sell side analysts are completely useless. They did not raise their target on any tangible change in their numbers. I bet if the FED tapered 20B yesterday they do not raise price target. I bet this guys boss has been asking him why he is not one of the higher end price targets on the street. I also bet DB wants to capture some TSLA banking business so you have to please Elon with a high target.
    19 Sep 2013, 11:30 AM Reply Like
  • Majek_eight
    , contributor
    Comments (74) | Send Message
     
    @sharkdude,
    Seems as if you're doing a lot of betting.
    I agree that following any analysts advice is asking for trouble. They usually don't have the individual investor's interest in mind when making a call.
    I keep saying, one misstep by Tesla and the stock will fall dramatically. The problem is the company and Musk have not made any missteps- yet. Too high to buy and too controversial and risky to short. Best to stay away if you're not involved on either side.
    19 Sep 2013, 02:10 PM Reply Like
  • SharkDude
    , contributor
    Comments (553) | Send Message
     
    You are correct. I am short a bit. But it is more about the monkey mentality with investing. Just wait someone with a $200 target will raise it in response. Read the guys comment. Not based on numbers at all. Partially bases on reading blogs!!! How idiotic is that. And to mention gross margins is just incredibly misleading. On the track they are on they could have 30% gross margins forever and never actually have a profit.
    19 Sep 2013, 04:17 PM Reply Like
  • dennisg13
    , contributor
    Comments (129) | Send Message
     
    SharkDude:
    Don't you have something more productive to do?
    19 Sep 2013, 09:50 PM Reply Like
  • arondaniel
    , contributor
    Comments (639) | Send Message
     
    "On the track they are on they could have 30% gross margins forever and never actually have a profit."

     

    ...you mean, because they're investing in technology development, stores and superchargers which will further their lead in the next generation of transport?
    20 Sep 2013, 02:34 AM Reply Like
  • speedofov
    , contributor
    Comments (91) | Send Message
     
    Please don't jump all over me on this, but is the new Chevrolet Spark EV being ignored? GM is already in this business. It's not in the same league as Tesla, but is pure electric, recharges on 110 or 220, and is under $30,000 before tax credits. It's only available in a few states but they are in the game.
    19 Sep 2013, 11:41 AM Reply Like
  • AlexiaEP
    , contributor
    Comments (1076) | Send Message
     
    To clarify for you, Mr. Speedofov, the GM article said '200 miles of range'. The Chevy Spark is no where near that.

     

    IF GM could do what it claims, the Spark would have that 200 miles of range. It does not.

     

    The GM article plainly said they couldn't make the specified vehicle because their battery costs were too high. Then there was a quote from JB Straubel that stated Tesla pays 1/2 to 1/4 the price for their batteries than everyone else.
    19 Sep 2013, 12:26 PM Reply Like
  • tech01x
    , contributor
    Comments (639) | Send Message
     
    It's good that GM is in the market. They've shown more leadership than Ford or Chrysler/Fiat in the coming fundamental change in transportation.

     

    The Spark EV, however, defines the meaning of "compliance car." It comes from Daewoo and was not designed as an EV from inception. It features a permanent magnet motor - which means it has to use rare earth elements. Not a good thing. Since it is not a clean sheet EV design, the Spark EV actually has less cargo room than the gasoline version. Range is only 80 miles. As compliance cars, GM is willing to lose significant money on each one and therefore they're only available in CA and OR.

     

    Again, nice that they are trying even if most of the details are wrong.
    19 Sep 2013, 12:32 PM Reply Like
  • joenjensen
    , contributor
    Comments (637) | Send Message
     
    Of course they do, when or if you sell something don't you like to make a profit? Tesla is in business to make money, if it's true that they can get a special price for their batteries, why do you have a problem with that?
    That's called profit.
    19 Sep 2013, 07:49 PM Reply Like
  • Cassina Tarsia
    , contributor
    Comments (641) | Send Message
     
    Look out shorts ... here we come again!
    19 Sep 2013, 12:04 PM Reply Like
  • joeinslw
    , contributor
    Comments (84) | Send Message
     
    That's Right........VAROOOOMM...
    19 Sep 2013, 04:41 PM Reply Like
  • Paulo Santos
    , contributor
    Comments (17883) | Send Message
     
    Amazingly, TSLA still trades at a 2014 P/E discount to AMZN, in spite of having increasing estimates versus AMZN's decreasing estimates, and also growing revenues faster.

     

    TSLA trades for 97 times its 2014 consensus. AMZN is at 111 times.

     

    TSLA would have to trade up to $204 to catch AMZN's multiple.
    19 Sep 2013, 12:27 PM Reply Like
  • Markmc
    , contributor
    Comments (3) | Send Message
     
    And how about Tesla vs. Netflix?
    19 Sep 2013, 01:07 PM Reply Like
  • Paulo Santos
    , contributor
    Comments (17883) | Send Message
     
    TSLA is slightly more expensive on 2014 numbers. NFLX is trading at 91 times 2014 estimates. And it, too, has rising estimates (though slower revenue growth).
    19 Sep 2013, 01:12 PM Reply Like
  • Mark Krieger
    , contributor
    Comments (3795) | Send Message
     
    that's assuming they meet their numbers in 2014, and that's a big "if", because those numbers have gotten quite rosy lately.
    19 Sep 2013, 01:22 PM Reply Like
  • SharkDude
    , contributor
    Comments (553) | Send Message
     
    You can't have a P/E if you do not make money.
    19 Sep 2013, 01:58 PM Reply Like
  • Agnes59
    , contributor
    Comments (361) | Send Message
     
    @Paulo Santos: You must be running out of excuses to compare at this time AMZ to TSLA. Why not compare it to GM or F or TM.
    19 Sep 2013, 03:08 PM Reply Like
  • Paulo Santos
    , contributor
    Comments (17883) | Send Message
     
    Agnes, it's just funny that a much more mature company, AMZN; still manages to have an higher valuation, that's all.
    19 Sep 2013, 03:09 PM Reply Like
  • joeinslw
    , contributor
    Comments (84) | Send Message
     
    It'll be there next week.....
    19 Sep 2013, 05:26 PM Reply Like
  • dennisg13
    , contributor
    Comments (129) | Send Message
     
    READ
    He said based on 2014 consensus.
    19 Sep 2013, 09:53 PM Reply Like
  • pat1000
    , contributor
    Comments (460) | Send Message
     
    Two hundred four (and that is about how many times you and JP have cost people money) and were going for more!!!!!
    19 Sep 2013, 11:08 PM Reply Like
  • antiguajohn
    , contributor
    Comments (72) | Send Message
     
    Tesla, GM, Ford, Nissan, Toyota BMW, Mercedes, Audi, Porsche, Volvo, Renault, or any other list of car manufacturers, are now starting to ramp up their EV offerings.

     

    EV sales are up 203% and yes they are currently only a small percentage of the market, however anyone who is cognizant of an exponential growth curve and that low cost large scale energy storage is just around the corner, add that solar and winds constantly lowering costs are making fossil fuels increasingly uneconomic.

     

    Considering the above, perhaps it will soon be time to short the fossil fuel business, after all capitalism's best tool namely creative destruction is still working to shape a more efficient economy.

     

    To me I care no so much regarding who has the largest market share for EVs, what matters is that we get off fossil fuels and become energy independent and reap the plethora of benefits of this paradigm shift.

     

    That said I would like to see Tesla as the leader or one of the leaders, they deserve this if for no other reason than they took a chance and changed the market for the good.

     

    antiguajohn
    19 Sep 2013, 01:21 PM Reply Like
  • Agnes59
    , contributor
    Comments (361) | Send Message
     
    Amen on that antiguajohn...
    19 Sep 2013, 01:31 PM Reply Like
  • arondaniel
    , contributor
    Comments (639) | Send Message
     
    Curious, how can one short Dino oil most effectively? Short Exxon directly or buy an ETF like DIG or DUG?
    20 Sep 2013, 02:38 AM Reply Like
  • Majek_eight
    , contributor
    Comments (74) | Send Message
     
    Interesting that all the usual Tesla bears are hibernating right now. You can come up with all the rational reasons, valuation comparisons, spreadsheets, high P/E, P/BV ratios as to why the stock is overvalued and the bubble will eventually "pop", if you're early- you're still wrong. Looks like the shorts were early... again. This is not a rational stock.
    Even a 10-15% correction from here won't hurt the longs.
    19 Sep 2013, 01:33 PM Reply Like
  • HMGD
    , contributor
    Comments (155) | Send Message
     
    "Even a 10-15% correction from here won't hurt the longs."

     

    Actually not even a 30% correction will hurt us. Of course, we, true longs are ready for a true correction, we are not here just for a lucky shot, I believe that in the present Tesla fair price is about 90 US Dollars... Nevertheless the potential into the future (5 years from now) is far above 90 dollars, don't know if it is 180 or 280, time will finally tell.

     

    Truth is there are more pessimistic bears out there than objective ones, but thanks God, there's been light along the way..

     

    Anyone who still believe that Longs don't know that Tesla in the present is overvalued are just embracing myths. We know Tesla is on hype, we know Tesla will have true competition some day (heck!, we are even expecting it, we are eager to see it), the thing is that there are good reasons for every single last drop of hype put on Tesla.
    19 Sep 2013, 02:40 PM Reply Like
  • jamesingram32
    , contributor
    Comments (544) | Send Message
     
    well said hmgd, good luck to you. As someone just interessted in making some money, I'm new to tsla, and won't be jumping in at this price. well done on getting in early
    19 Sep 2013, 02:51 PM Reply Like
  • Dan Fichana
    , contributor
    Comments (1798) | Send Message
     
    James, be very very careful if you short Tesla, have some stop losses in place or do something to prevent your losses.

     

    Betting against Elon Musk is mostly likely a bad thing and will get you burned.

     

    You must look to the future for Tesla along with their gross margins and gross profits. If they can sustain the percentage margins with other cars and sell a few hundrend thousand cars, the valuation compared to big auto would be justified.

     

    Then factor in the liabilities; GM, Ford, and Toyota focus on high volume low margin cars; a asisinie recall concerning those cars drastically kills their profit. Tesla, not so much. Less risk on Tesla's part.

     

    What would you rather have, 100,000 cars that you made a 5,000 profit on and have to replace a $300 part OR 1,000,000 cars that you made $500 and had to replace the same $300 part.
    19 Sep 2013, 03:29 PM Reply Like
  • jamesingram32
    , contributor
    Comments (544) | Send Message
     
    fair point Dan. i have not shorted anything ever, although in 2008 i should have !

     

    I hear what you are saying about the higher margins. I need to study this one further. At the moment I would ask though, they are still operating at a loss though? So, there is a lot of hope built in here. I get it that Elon is superhuman, and tesla does not have all the baggage of ford etc. In fact huge companies do start from tiny beginnings, e.g. Toyoda/Toyota. So you might be on to something. I need to read up on this more before taking a position one way or the other
    19 Sep 2013, 04:01 PM Reply Like
  • Tales From The Future
    , contributor
    Comments (4122) | Send Message
     
    "...call Musk today asking if he wants to raise some money here. Actually Musk would be an idiot not to. "

     

    Puzzles me too. The company should take advantage of the people buying the stock at these levels. Issue a few more convertibles or stock...as long as there are buyers standing in line, sell them bags.

     

    Musk already hedged himself with recent comments on the stock price.
    19 Sep 2013, 04:20 PM Reply Like
  • joeinslw
    , contributor
    Comments (84) | Send Message
     
    Keep wishing, it can't hurt unless your shorting....
    19 Sep 2013, 04:53 PM Reply Like
  • Yarak
    , contributor
    Comments (256) | Send Message
     
    speeofov, good point. The majors will quickly develop their processes and Tesla will not be able to replicate anywhere near the margins achieved with the Model S in the lower segment - in which range will be determined purely by battery capacity, which in turn will have a tremendous impact on price and/or margin. All the companies will have similar processes in a year or two, and all will be vying for the same sources of battery capacity. People in this segment won't care a whole lot about the fact that Tesla has a good performance model - just like they wouldn't care much to buy a Porsche if it made a $30k car that looked and felt like a Chevy of the same price. All this would do is harm Porsche's brand.

     

    Tough road from here on out for Tesla to generate profits to justify this valuation.
    19 Sep 2013, 02:58 PM Reply Like
  • proberge
    , contributor
    Comments (8) | Send Message
     
    GM makes mostly crap. Cadillacs are good, anything from Opel is good (Cruze, Orlando), Muscle cars are ok. The rest is crap. GM EV cars will be crap.
    19 Sep 2013, 03:19 PM Reply Like
  • captiankirkoptions
    , contributor
    Comments (192) | Send Message
     
    The insanity continues - amazing. Math does not seem to matter to Tesla investors.
    19 Sep 2013, 03:11 PM Reply Like
  • AndyMahnFL
    , contributor
    Comments (49) | Send Message
     
    It's more like Algebraic (exponential).
    19 Sep 2013, 06:46 PM Reply Like
  • hughesrd
    , contributor
    Comments (116) | Send Message
     
    I'm not used to making $13,000 a day, when the "market" is down slightly. But I like it. I'm prepared for a correction, long at $29.90 on average. My wife won't let me buy a model S until we're up much more; apt to be a better car then but even pricier.
    19 Sep 2013, 03:11 PM Reply Like
  • just the truth
    , contributor
    Comments (50) | Send Message
     
    Thought I had a difficult wife. She said I can buy it when the stock triples from where I bought it. Looks like you are way over that. Hughesrd's wife give the guy some slack :)
    19 Sep 2013, 04:04 PM Reply Like
  • dennisg13
    , contributor
    Comments (129) | Send Message
     
    hughesrd
    Good for you. I made over twice that today between TSLA and SCTY. Been in since about $20. I'm going to wait for a Model E. Not a big sedan or SUV guy. But I do know that I will NEVER buy a ICE car again.
    19 Sep 2013, 09:59 PM Reply Like
  • Sech
    , contributor
    Comments (38) | Send Message
     
    same opinion here. I will be driving my car for 3 more years and then I'll buy a Model E. I do not want to give a penny to those company that have been offering micro improvements for years
    20 Sep 2013, 09:41 PM Reply Like
  • pat1000
    , contributor
    Comments (460) | Send Message
     
    Getting our S in 8 days and received the reservation # 5825 for the model X----

     

    Another Tesla number that goes up each and every day is the # of people receiving the Tesla articles----Today it exceeded 25,000 for the first time-----25,048 to be exact----
    19 Sep 2013, 11:32 PM Reply Like
  • just the truth
    , contributor
    Comments (50) | Send Message
     
    Green with envy :) Have they set pricing on the X yet?
    20 Sep 2013, 04:41 PM Reply Like
  • moonlightingt
    , contributor
    Comments (23) | Send Message
     
    TSLA's jump from its $164-$167 range is a great opportunity to be slightly bearish by selling out-of-the-money call spreads against this stock (weekly options might be ideal considering its volatility). With the markets at all-time highs, any correction would slow down the exponential move increasing the chances to pocket the premiums in the process.
    20 Sep 2013, 02:11 AM Reply Like
  • Joe E Coyotee
    , contributor
    Comments (243) | Send Message
     
    Yesterday I was spotted at the Tesla Store and the next day the stock shoots up 11 dollars so I went back to the Tesla store today
    we will see what happens tomorrow, I might have to keep going back.
    20 Sep 2013, 03:22 AM Reply Like
  • Tales From The Future
    , contributor
    Comments (4122) | Send Message
     
    You might want to re-read this given today's price at $185:

     

    "To mitigate the potential dilution impact from the issuance of convertible debt to our common shareholders, we also entered into a call spread to increase the effective conversion price from $125 to $184 per share. The call spread allows us to avoid incremental dilution from the convertible debt until our common share price climbs past $184. However, until the convertible notes mature in five years, the calculation of diluted earnings per share would be affected when the average stock price in the quarter is above $125. We will publish shortly a table at our investor relations website that illustrates the potential earnings per share dilution."

     

    The big boys can now cash in. I wonder what happens next...retail investors will find out over the next few months.
    20 Sep 2013, 12:24 PM Reply Like
  • jamesingram32
    , contributor
    Comments (544) | Send Message
     
    tftf, whao, would this give you the courage to try puts or shorting?
    Do you have a link for this? thanks
    20 Sep 2013, 02:53 PM Reply Like
  • Soursmash
    , contributor
    Comments (13) | Send Message
     
    Bwah hahah! When this house of cards flops, it's gonna be A-holes and elbows at the court house. Don't get me wrong, I like TSLA, but this is ridiculous! I saw this exact pump and dump with AAPL. Prosper!
    21 Sep 2013, 04:42 AM Reply Like
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