Biased Tesla story on investing site

Discussion in 'Tesla' started by ElectrifyMe, May 29, 2019.

  1. ElectrifyMe

    ElectrifyMe New Member

    The Seeking Alpha site has a long, opinion-laden story called Tesla’s Catastrophic Miscalculation written by a writer using a cutesy pseudonym. When you click on his name, his own description describes him as a CPA doing work as a consultant to the oil and gas industry. A clear conflict of interest. But get this: I posted a comment, encouraging people not to waste time on stories written by people with clear conflicts of interest, but the site deleted my comment. They emailed an automatic email, saying it was because my comment “contains an allegation of bad faith against another user.”
    The site bothers to have writers list if they hold stock in companies they mention, which would represent a conflict of interest. But being paid by the industry trying to fight electric vehicles? That’s the ultimate conflict of interest, yet the website felt that pointing that out was in violation of their comment policy.
    Has anyone else run into such a clear lack of integrity? It really bothers me that people reading that article have no idea who wrote it and, presumably, why.
    bwilson4web likes this.
  2. bwilson4web

    bwilson4web Well-Known Member Subscriber

    Apparently the SEC will pursue a corporate officer who says something wrong. However, 3d parties are allowed to spread bovine fecal matter with impunity.

    Bob Wilson
  3. Pushmi-Pullyu

    Pushmi-Pullyu Well-Known Member

    Yup. Welcome to what some of us call "Shrieking Alpha". I've had the same experience myself.

    The management of SA isn't interested in facts or objective truth or unbiased opinions. They're just interested in people clicking on the blog posts there, which are misnamed "articles".

    I've noticed a tendency of SA writers to assert "I currently own no stock in any of the companies mentioned." What they do not say is "I'm not being paid to write this blog post by a financial firm promoting buying/selling this stock", nor do they say "I haven't ever owned this stock, nor do I intend to buy it in the very near future."

    If you want actual facts or honest, informed opinions about Tesla Inc. or its stock, then look elsewhere. I'd estimate that only about 2% of the Tesla-related blog posts at SA are unbiased and truthful. Something like 80% are strongly or even virulently anti-Tesla, and most of the remaining are Tesla cheerleader blogs from those promoting buying TSLA.

    Very few blog posts posted there are written with the intent of actually informing the reader in a neutral manner.

    I have come to the firm opinion that nearly all of what passes for "investment advice" given freely to the public is actually attempts by professional stock manipulators to manipulate stock prices. That applies to everything posted to social media or seen in interview videos at financial news sites, not just SA.

    Real financial advisors charge for their services, and give their opinions in private. What would be the motive of someone giving away their advice, when that's how real financial advisors make a living? If they give it away on the internet, or in some video interview at CNBC or elsewhere, then they can't make money off it... unless it's someone like Jim Cramer, who is paid by a network for his daily show. (Of course, anybody who knows much about Cramer knows that he has pled guilty to stock manipulation, too.)

    So when I read an article that concerns Tesla at Bloomberg or Forbes or some other news site aimed at investors, I just assume it's an attempt to either pump or dump Tesla stock. That's not always the case, but it's best to exercise skepticism and assume that's the default case. There are exceptions, but I think they are rare.

    It also helps to know who the leading anti-Tesla writers are. If you see the writer is "Mark B. Spiegel" or "Jim Chanos" or "Edward Niedermeyer", or if the byline is "Linette Lopez" (a charlatan journalist working for Business Insider), then you know you're in for a heavy dose of anti-Tesla FUD and pravduh.

    Last edited: May 30, 2019
  4. David Green

    David Green Well-Known Member

    Bob, Elon tweeted that he was planning to take Tesla Private, and had "FUNDING SECURED" at a substantial premium over the market price at the time, which triggered a run up on the stock price. That is clearly "Market Manipulation" and became criminal when you consider funding was actually not secured, and actually Musk did not even realize that many of his strongest allies would not be able to invest if the company went private. Musk tried to burn the shorts, and LOST... Musk did open the door for my first run shorting the stock which brought me a 20% net profit in 2 weeks. I will not complain, wish he would try it again... Tesla is clearly a company in serious trouble, stock down year to date, even though the market indexes are up substantially. Demand is not ramping as Elon had guided, and now Tesla is pushing, and trying to reach the Q4 2018 sales level, that Tesla had guided at the time was just a step on the ultimate ramp. Tesla had guided 500K sales in 2018, actual was less than half that, and ramping to 1M annual sales in 2020, haha! I think they have given up on that too. Recently we are starting to see suppliers take legal actions to nullify their contracts, and force payments from Tesla. This is common in a company within 6-12 months of restructuring. Now Model Y is going to be squeezed into Fremont, haha! GF1 has no new construction ongoing, and partner Panasonic is not going to invest new monies in the partnership. Elon has said several times recently GF1 is production constrained on battery cells, I wonder where are the batteries going to come from to fire off production at GF3, Elon and Tesla had officially guided initial runs would come from GF1, but it seems that is not going to happen with the other Tesla and partner statements recently. BTW, GF3 is so small, but scaling the cranes on site it looks that the building is less than 1M sq ft, and Elon has guided that initial production will be 250K cars annually? with all the operations of Fremont 7M Sq ft, and GF1 5M Sq ft, wow, Tesla has been downsizing production big time... haha!
  5. Pushmi-Pullyu

    Pushmi-Pullyu Well-Known Member

    Speaking of 3d parties who are allowed to spread bovine fecal matter with impunity... :rolleyes:

    Yeah, Tesla is "in trouble" all right. The trouble is it has more demand than it can meet! Very nearly every manufacturer in the world would love to have that kind of "trouble".

    Apparently this is what passes for "evidence" among the hardcore anti-Tesla cultists frequenting the TslaQ site. The same sort of "reasoning" used by their "Shorty Air Force" in their clownish and futile attempts to predict Tesla production or deliveries by counting the number of cars in a relative few of the many, many lots that Tesla uses for temporary storage of cars at waypoints during shipment. Of course, their attempts at predictions based on such a small data set have proven laughably wrong (and are a textbook example of observer bias), but that isn't stopping them! :p

    Keep going Tesla!
    Last edited: May 30, 2019
  6. bwilson4web

    bwilson4web Well-Known Member Subscriber

    And he paid a price for it, ~$40M between fines and his other payments. In contrast, the SHORTs continue to make claims that TSLA is collapsing with little or no empirical evidence, just idle speculation, yet the SEC remain mute.

    In about 5 weeks, we'll have the Q2 2019 production numbers. Then in 9 weeks we'll have the financials. All of these SEC filed so I'm patient.

    Bob Wilson

    ps. Still no link to that Tesla crash? My attempts with Google couldn't find it either.
  7. David Green

    David Green Well-Known Member

    Like I said, Elon broke the SEC laws, and is not allowed to deny it as part of his settlement. Shorts make lots of claims, for example one I follow that makes lots of charts, has a disclaimer on his twitter account that he is not giving investment advise, and his site is "catnip" for Tesla bears. Anyway, these are not official investment folks, they are crowd sourcing data, and if Tesla would just execute, and be profitable, they would not have to worry, and the bears would run off and hide.

    Now, Tesla lost over $1B in 2018, and $700M so far in 2019, so that means they are $1.7B closer to a complete collapse financially then they were in 2017. Also the ASP (Average Sale Price) has fallen dramatically in 2019 over 2018, that's a bad trend... It's easier to see a bear case for Tesla, then it is to justify a bull case, and Elon has missed on almost every of his important guidance the last 6 months. You are patient Bob, and I hope that pays off for you, but I do not think it is going to happen in the timeline you expect. I can easily see TSLA trading below $180 soon, and much more likely than being over $200
  8. David Green

    David Green Well-Known Member

    Hey Bob, No speculation here, Tesla CTO JB Straubel is selling stock again this week even at these super depressed prices. Now why would he do that if he thinks good news is coming soon?

    Do You think you know more about the inner workings of Tesla than does JB?
  9. bwilson4web

    bwilson4web Well-Known Member Subscriber

    My investment strategy is based on:
    • Best product
    • Operational margin
    So far, I've not seen EV products that come close to our Standard Range Plus Model 3 and the Tesla SuperCharger network. Perhaps you missed that I've done multiple long range drives and so far, it has been what I've expected with lessons learned:
    • 220 mi loop to test Athens AL SuperCharger and get charging rate data.
    • ~500 mi loop to Memphis TN twice, and Tupelo AL SuperCharger to test longer range and visit Tunica casino. Sad to say, failed to test Tunica RV park.
    • ~750 mi trip to Coffeyville KS via Memphis TN, Little Rock AR, Fort Smith RV park, and Tulsa OK. Returned via Springfield MO, Little Rock AR, Memphis TN, and Tupelo MS.
    • ~750 mi trip to Richland TX (Dallas) via Memphis TN, Little Rock AR, Texarkana TX, Sulphur Springs TX, Plano TX, La Quinta distribution charger, Lindale TX, Shreveport LA, Monroe LA, Ameristar RV Park Vicksburg MS, Perl MS (twice), Meridian MS, and Birmingham AL.
    Our Model 3 is getting the equivalent of 64 MPG when gas costs $2.50. AutoPilot has been a valuable, co-pilot so I did all of the driving. AutoPilot has been especially useful in traffic jams. We've also used the car as a climate controlled kennel so we can take all of our dogs and avoid significant kennel fees.

    The Q3 2018, Q4 2018, and Q1 2019 financial reports show an operational profit on each model. There was a loss in Q1 2019 but this also coincided with increasing the market with significant shipping of inventory as well as other capital expenditures. So I'm fairly sanguine about the prospects and look forward to the Q2 2019 production and financial report.

    Bob Wilson
  10. David Green

    David Green Well-Known Member

    Bob, there are numerous mistakes in your reply, I will correct... First and foremost Tesla did NOT report an operational profit in Q1 2019, they actually reported a "LOSS FROM OPERATIONS" of $522M. See attached slide taken from 2019 Q1 10-Q.

    You are confusing GROSS Profit (which is "revenue" minus "cost of goods sold" but does not include R & D, and S, G, & A operational expenses. Most auto companies report their R & D as an expense against the Cost of Goods Sold, but Tesla does not do this to artificially inflate their Gross Profit.

    Capital Expenditures are not shown or reflected in the operational earnings numbers, these capital items are reported in the cash flow statement, and balance sheet.

    There are a few alarming numbers hidden in the data. For one I think the ASP (average sale price) dropped from $70K in Q4 2018 to $58K in Q1 2019 is alarming, what do you think will happen with this number in Q2 2019 as Model 3 SR+ was made available in Europe and China? I expect we will see the ASP continue to drop as Model S and X have not shown a huge recovery in sales and by some measures are continuing to tumble. Remember shorts saying Model 3 sales growth would clobber S and X sales? Looks like shorts were right again.

    As for your claims that Model 3 is the best, that is your opinion (not a financial fact), in the USA 17 Million new cars were sold last year and far less then 1% of them were Model 3's so I think the vast majority do not consider the Model 3 the best for their needs.

    Screen Shot 2019-05-31 at 1.36.21 AM.png
  11. bwilson4web

    bwilson4web Well-Known Member Subscriber

    Returning the favor:
    See attached the full, SEC Q1 2019 summary:

    Tesla First Quarter 2019 Update
    • GAAP operating loss of $522M, GAAP net loss of $702M, including $188M of non-recurring
    • Cash and cash equivalents of $2.2B at Q1-end
    Model 3 gross margin ~20% in Q1
    • Revealed Tesla Model Y
    • Started production of Full Self Driving computer
    . . .

    I see a company that after the Q4 2018 blow-out, continues to improve internal processes that reduce costs to improve future profits. They continue to expand their product line so the former 'cash cows', the Model S and X are less important to future profits. They are refreshing the Model S using lessons learned from the Model 3.
    These are proven advantages of our Standard Range Plus Model 3:
    • Twice as cheap per mile to drive around town - using home charging and not counting free charging around Huntsville. The 204 mi EV urban range is 9x further than the 25 mi Prius Prime so I don't have the pressure to shop primarily where there are free chargers.
    • 14% cheaper per mile on the highway - recent trips have shown it is (64 - 56) / 56 ~= 14% using the Tesla SuperCharger network. Combined with staying at hotels/motels with EV chargers or camping-in-the-car at RV parks, we can get a 'free', full charge in 5 hours.
    • Safety - AutoPilot has avoided five micro-sleep induced, crashes, on a sleep deprived return drive.
    These proven capabilities included a learning curve similar to what I went through with our 2003 Prius. I am not jealous of those who have different requirements met by the vehicle(s) they choose. After all, it is their money. I can only choose vehicles that best meets ours.

    BTW, good save avoiding that iPace. Given the expense and performance of the Electrify America network along with the flaws of the iPace, you dodged a bullet.

    Bob Wilson

    ps. My experience in the past is the harder someone tries to change my mind, the more I begin to wonder 'what is in it for them?' A hard sell tends to feed my natural paranoia which makes SHORT advocacy less persuasive.

    Attached Files:

    Last edited: May 31, 2019
  12. DaleL

    DaleL Active Member

    It is my observation that Tesla is in a bit of trouble. Some of it is self inflicted, but some of it is outside of the control of Tesla and Elon Musk. The whole tariff war with China is damaging to Tesla. Tesla is having difficulties in many small ways such as their solar power business. The solar power installations that Tesla installed in Puerto Rico after Irma are reported to have had serious issues with siting and maintenance. Tesla cars continue to only compete in the upscale sporty niche market. The $35,000 Model 3 is still in the future and was promised as a $27,500 (after Federal tax credit) car.

    Tesla's stock value is now 1/2 what it was 6 months ago. Much of Tesla's "success" to date is because there has not been much competition. Ironically, if or when Tesla starts to make money on their electric cars, all the other vehicle manufacturers will jump in to get a share of the "pie".

    My wife and I recently came back from a two week vacation in Europe. We saw exactly 3 Teslas. The vehicles that seem to dominate the left lane on the German Autobahn are the big BMWs and Mercedes. Our rental car was a cute little Skoda Citigo with a giant one liter engine and 5 speed manual transmission. I estimate the fuel economy, if run on the EPA cycle, to have been about 55 mpg. (A good thing with gasoline at $6.00 per gallon.) I saw only one, just one, electric vehicle charging station. My observation is that Tesla has serious obstacles to overcome in Europe.

    Skoda was bought by VW in 2000. Their cars are sold in some 100 countries. Last year Skoda manufactured and sold 1.25 million vehicles. Skoda's operating profit in 2017 was 1.7 billion dollars! I mention all this because before last April, I didn't even know that Skoda existed. Competition in the US car market is artificially restricted by the US Federal safety requirements.

    Tesla and Tesla cars will be around for a long time, but building the "best" while losing money isn't how to run a company. Like Skoda, Tesla sometime in the future will likely be a subsidiary of a company that actually knows how to make money building cars.
  13. David Green

    David Green Well-Known Member

    I see Bob, again you confused GROSS MARGIN WITH NET PROFIT. Gross Margin in a metric that is very helpful in evaluating a healthy company, which Tesla is not a healthy company. I have seen several supplier lawsuits filed in CA in the last few weeks, mostly for non payment per terms, and reading through the lawsuits it is clear Tesla is "managing" cash flow, and hurting suppliers. This strategy goes against my business morals, in our industry we call companies like that "slow pay". Even working for Boeing we have not experienced that kind of treatment, they pay electronically, and it is right on time at 60 days from invoice. Walmart on the other hand is pretty much like Tesla, they try to make you sue them to get paid.

    You know, I do not wish to convince you of anything, your stock account value dropping should be all it takes to convince you or anyone. Tesla has been very spoiled by Wall Street, with a valuation that does not work by any regular metric, and new financing rounds whenever they need it. However it is clear that Tesla management is way out of their core competence as they simply miss nearly all guidance, and are constantly in flux both with pricing and strategy. I guess this is the reason Tesla remains a sub 100K quarterly vehicle producer, that has lost money in every year since its inception. Its looking like 2019 will be no different...

    I see Tesla's new plan is to try and fleece Chinese buyers out of their deposit funds... haha! Chinese are smarter than that, they are not going to fall for Tesla's ploy, trying to sell a Chinese built car for more than they sell the same car built in America to Americans. Looks like the stock sentiment is reacting negative in pre market trading. Oh No, Watch Out Below!

    Ok Bob, you claim the Model 3 saved you from 5 crashes, and you have only had it a few months, how often do you crash old timer? I am nearing a million miles since my last accident (not my fault.. rear ended in traffic), and before that it was 300K miles since my first crash as a teenager which I slid on ice and hit another car (completely my fault).

    I agree on the I-Pace, I am happy that I did not buy it as they cars have numerous bugs. I hate buggy products. As for EA chargers, there are 23 locations going into WA state (Cycle 1 investment), which vastly outnumbers Tesla Supercharger locations which have been stuck at 16. I hear we are on the list for further chargers in Cycle 2, and have seen several permit applications come through the last 2 months that are Cycle 2 installations. My friends company is doing the electrical work on several of the stations in the local area now, and we did the excavating on 2 of them. I have Charged at EA stations in North Bend and Ellensburg, and did experience some payment bugs, but they charged fine once the payment was sorted.
  14. David Green

    David Green Well-Known Member

    Dale, great analysis, I agree with almost everything you said. I predict Toyota will purchase Tesla at some point (after the upcoming re-org which wipes out the equity), and will sell and service the cars through the Lexus Dealership network. Musk has to go for Tesla to become successful, and when Musk goes there has to be a big money owner with manufacturing experience to correct all the problems.
  15. bwilson4web

    bwilson4web Well-Known Member Subscriber

  16. interestedinEV

    interestedinEV Well-Known Member

    “The reports of my death are greatly exaggerated.” or variants of this were used by Mark Twain. Even time I read Tesla is going under, they come up with something new which raises stock prices. Elon has a capacity to surprise and I would not write him off for now. He is like a cat with nine lives and he is in his 4th or 5th life. Let us look at this thread one year from now and see where Elon and Tesla are. My bets are that he will be doing quite well.

    All competition so far is at the higher end and no body has proven then they have lasting power of Tesla. Yes @David Green has an Audi, but can they sell in enough volumes to give Tesla X and S a run for their money? I have in the past said that I believe Hyundai is going to be giving real competition and I was dismissed as people felt that it was not a proper comparison, as they are not in the same league. So far that is true but I think Hyundai will try and move up to compete with Model 3 and we have many players like Audi, Jaguar, Mercedes, Rivian etc trying to attack the higher end. That is when Tesla will be put to the real test, when they are being attacked at both ends.
  17. ElectrifyMe

    ElectrifyMe New Member

    Look at Amazon for a good comparison: They were ahead of most with what they did but they poured all their revenue into the company and lost money for years and years. That self-investment led them to create value that wasn’t the initial core business (their cloud services), which now makes them much more money than selling stuff to you and me (this is common knowledge). A good analogy to self-driving technology that one day could prove Tesla’s most valuable business.
  18. David Green

    David Green Well-Known Member

    Tesla aint no Amazon.... and go back and look at Amazons valuations and earnings report before you use them as a comparison... NOTHING IN COMMON...

    Elon Musk aint no Jeff Bezos, Jeff has built his company by promoting and delegating responsibilities to qualified folks. Elon tries to manage by taking everything on himself, no wonder he so often fails to deliver the vision and guidance.

    BTW, sounds like JB Straubel is on the outs now according to Electrek, this would be a huge blow for Tesla... JB is the key to their technical advantages in the few ares they have them.

    I suspect JB might already be aligning with Toyota so when the buyout / takeover happens, they just kick Elon to the door, and keep moving forward under new leadership.
  19. David Green

    David Green Well-Known Member

    BTW, pouring money back into a business through Capital investment does not create losses, losses are from selling products and services for less than it takes to design, build, sell, and service the product. I wonder how long it will take all you Tesla fans to stop saying Teslas losses are from Capital investments, THAT IS A LIE....
  20. bwilson4web

    bwilson4web Well-Known Member Subscriber

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