Expected to see this on the FP, Tesla stock down 25%

"blacktruck18" (blacktruck14)
12/09/2014 at 12:10 • Filed to: None

There seems to be a belief that Tesla's stock has been too high for a while now. I don't know enough to comment if this is where the price should be but, I have to agree with the article. Until they start producing cheaper cars there isn't enough of a market to support Tesla as a status vehicle. Especially with the people that buy them as a status symbol are more likely to switch when something cooler or more exclusive when they get bored.

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DISCUSSION (13)

R Saldana [|Oo|======|oO|] - BTC/ETH/LTC Prophet > blacktruck18
12/09/2014 at 12:16

I am really perturbed by the drop in oil and natural as prices. I think it may have to do with the stagnation of wages in the US.

Makes we wonder when I see ads or get spam insurance and emails "like where in the fuck do these people think our money is coming form". I mean generationally speaking the current 20-40 bracket has the least disposable income of any other demographic. This is primarily due to the indoctrination that kids simply MUST go to college. And if they cant afford it, here take this horrible high interest student loan that you will most likely pay off by the time you are eligible for SS.

B_dol > blacktruck18
12/09/2014 at 12:16

I will concede that TSLA has achieved a lofty and controversial price point, however I have no doubt that the company is destine for success. In US cities like LA, SF and DC these cars are extremely common and still in high demand. The battery and charging technology alone is enough to propel the company (aside from cars).

Hate or love Elon Musk, his companies are highly successful. I have been trading on large swings in TSLA for the past few years and will continue to do so.

Mosqvich > blacktruck18
12/09/2014 at 12:26

Here's the thing, what Tesla is really bringing to market is a new concept for power storage vis vis its giga-factory in Nevada. These batteries will be designed to not only work in Tesla automobiles, but also work with Solar City solar panel systems offering a reasonable way to store solar energy locally. There are many utilities who do not allow Solar unless the customer has local storage, which is very expensive currently. Some of Wall Street, the smart ones, get this and are going to take opportunity of this drop to scoop up Tesla at a bargain price.

A competitively priced product like the Model Whatever sedan would help tremendously, but Elon has his eyes set on world domination in the power industry. Mark my words, it will be the next big disruptive thing he brings to the world.

nermal > blacktruck18
12/09/2014 at 12:31

TSLA is the 2nd largest position in my portfolio, next to AAPL. Your headline made me nearly shat myself, as I thought that was referring to today only.

The dip relative to oil prices is short term. The thinking is that Teslas are less desirable due to the ROI from gas savings being minimized due to lower gas prices is pure horse poo.

The reality is that people don't buy Teslas to save money, they buy them because they are a great car, pure and simple. They also buy them for the image that driving a Tesla projects, as is traditional for those dropping $100k on a car. More important to TSLA pricing isn't so much demand for the Model S, as it is the compay's ability to bring the Model X to market, as well as the real money ball, the Model 3. The stock price is dropping because the Model X keeps getting delayed.

My take on it is firmly between ride out the dip if you're already invested, and BUY BUY BUY if you're not.

deekster_caddy > B_dol
12/09/2014 at 12:39

All this is true, but even Elon himself said the stock was way overvalued, before it was staying above $200. I can't believe it went as high as $286! I don't consider it 'down 25%' but 'back from the stratosphere'... and I still don't think it's a good buy price. I hope they knock their X out of the park, but the stock is too high for me to take that risk.

macanamera > blacktruck18
12/09/2014 at 12:41

Tesla's stock prices are really interesting. Their price earnings ratio is ludicrous, but the share price is so high because everyone thinks (knows) Tesla is the future. I am still split on it. In any case, I don't foresee anyone losing big on the stock, even at current price points. It might be a long hold, though.

macanamera > nermal
12/09/2014 at 12:42

The time to buy buy buy was a while ago.

BATC42 > B_dol
12/09/2014 at 12:45

For Tesla I believe he had the right idea. And I don't understand why automakers keep on wanting to build and launch affordable electric cars. Almost every time there is a major change in the automotive industry it comes from igh ends vehicles (except for downsizing, which exists mostly because of small, cheap cars and the need to make it cheap to run).

B_dol > BATC42
12/09/2014 at 12:52

Agreed! In that luxury electric car niche there is a dearth of options, especially if you don't want to settle for a hybrid. The BMW i8 and hopefully the Acura NSX will bring enticing competition to the Tesla market share.

I applaud the drive to build more affordable electric and hybrid cars though as large scale adoption is necessary for these cars to make a difference in societies habits. High end cars often develop the necessary technology that can trickle down and provide benefit later on (battery, carbon fiber tub mfg, etc.)

Roadster Man > blacktruck18
12/09/2014 at 13:17

My stocks in solar power dropped along with oil prices too. There's a bit of a panic there, this isn't a big deal at all for Tesla. There's a 2+ year waiting list for both the Model S and the Model X. Anything over $200/share is pretty huge in my book. I got in a $117 so I'm not complaining. Most analysts are saying to hold anyway- this is just a bump in the road for a serious company. The gigafactory, growing European sales (most popular car in Norway), and massive demand means that share prices are only dropping due to a failure to meet demand. That is awesome. Tesla is also positioning itself to become a battery supplier and not an auto manufacturer, so the popularity of cars like the BMW i8 only helps them even more.

P.S. it isn't down 25%

Biggus Dickus (RevsBro) > nermal
12/09/2014 at 13:59

This is the sort of irrational investor behavior that creates bubbles. Stick to the fundamentals, you shouldn't be placing a large position in something that is trading on a net loss, poor cash flow, and a forward P/E of around 73. Thats not investing, thats gambling.

nermal > Biggus Dickus (RevsBro)
12/09/2014 at 14:34

Isn't all investing pretty much gambling anyways, especially that done by amateurs?

Biggus Dickus (RevsBro) > nermal
12/09/2014 at 15:33

To a degree, yes. However there are certain things that can be done to remove the gambling aspect. Companies with solid fundamentals aren't really gambles.