Tesla security analysis - Q3 2018

Waiting for the isa on android and I’ll do exactly that :grin:
Hargreaves Lansdown as good as the app is really agrevates me with the £12 buy sell costs.

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Actually I’ll wait until the freetrade raise money comes out first :wink:

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You can already get the isa on Android, with a little jiggery pokery… and the iOS app.

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Waiting for switching then, already have a gia which I don’t want to get rid of for other reasons :wink:

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Check out this jiggery-pokery, not ideal but until they release switching accounts in android it will have to do.

Unfortunately only works if you have iPhone/iPad also

Good point. I saw your post on that the other day. If I’m honest, laziness plays a huge part here but I agree with you, the ipad app is not pretty.
I do tend to look at the app most days for the gia and plan on trading a fair bit in small amounts to grow a diversified portfolio.

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I have etf’s but if I am honest I might start collecting individual companies instead.

My reasoning:

  • apparently you only need 25 companies or so to be safely diversified, many etfs have more than this so is it overkill?

  • etfs are great but you don’t own the shares

  • etfs charge an annual fee, the only fee when buying shares is a one off stamp duty then no more fees

  • however etfs are so much easier to manage

Decisions decisions

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@stephen Why not have both - especially if the ETF has companies you can’t buy at the moment. That’s what I’ve done. :slight_smile:

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Smooth idea - I like it!

Great analysis!

I recently created a video on my thoughts on Tesla.

To summarise:

  • It does look like a potential buying opportunity. recent fall has considered it undervalued to some analysts.
  • I think the SEC tweet embago is significant as i assume many Tesla investors believe in the Vision and Elon more so than fundamentals, so his restrictions may negatively impact share price as he can’t influence it as much or as freely as before (This could be a positive thing depending on which way you look at it - as a more truer value and reflection may ensue)
  • there are some very interesting EV’s entering the market and some by established automotive companies with the infrastructure, logistics, retailers and cashflow to make it work, also some are 80% cheaper than the Tesla Model 3 which is meant to be their entry level vehicle. I think this may make it difficult for Tesla to enter many global territories and have a take up market share.
  • I think Tesla Insurance is a conflict of interest for consumers and may display issues down the line.

But i do believe they can figure most things out, so in light of that i’ll wait from a few weeks to at least to another quarter earnings as there so many factors that can pull Tesla’s Share price one way or another with significant volatility.

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Big News Today:

https://ir.tesla.com/news-releases/news-release-details/tesla-announces-offerings-common-stock-and-convertible-senior-0

Tesla, Inc. today announced offerings of $650 million of common stock and $1,350 million aggregate principal amount of convertible senior notes due in 2024 in concurrent underwritten registered public offerings. In addition, Tesla has granted the underwriters a 30-day option to purchase up to an additional 15% of each offering. Elon Musk, Tesla’s CEO, will participate by purchasing $10 million of common stock.

While the capital raise is obviously welcome, I’m not sure $650 million is enough, especially when double that is being issued in bonds at the same time. Tesla clearly has supreme confidence in its ability to achieve sustained profitability by the end of the year. If I were CFO I would definitely be considering splitting the stock as well and raising at least a few hundred more. Stock is up over 6% in pre-market nonetheless.

Here is the preliminary prospectus, which suggests an offer price of $238.69. The stock is currently headed for $250.

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Not taking it private :wink: but raising $2 billion. I saw a thread about a hour ago where the guy went in. Tesla bulls/bears really go for it.

In other news, had a look at their Model 3. It’s a lot more expensive than I thought it would be. Starting model in the UK is £38,050. The one I’d want starts at £56,050. Model 3 pricing is a bit wild.

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That is too expensive for them ever to become mainstream. You can buy a nice petrol car and have enough left over to pay for 10-15 years worth of fuel for that price

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I bet you can find stories where journalists made similar comments about the iPhone when it first launched :wink:

Edit

Here’s a classic -

& here’s a commentator in TechCrunch’s take -

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It is higher than expected. Clearly a lot of it is down to shipping, RHD and admin costs. The price @saf quotes is actually not inclusive of the destination fee (£850), and bare in mind the plug in grant of £3500.

image

You can hop onto Tesla’s designer and calculate how many miles you drive, the fuel savings for 10,000 miles a year at a slightly discounted petrol price amount to over £7k p/a (forgetting tax/congestion savings). Remember this price gets you the partial premium interior, autopilot, and standard range plus all included. It is highly likely that the price will come down as production scales and the boggo standard range model is reintroduced.

This is interesting news. Nicer than a split for existing investors.

Agreed, they need to get the price down significantly, but I think they do recognise that and are working at it. Not having LIDAR will help, I think that’s mostly why he’s against it - it is too costly for a mass market car. They need to aggressively drive this price down, and then Tesla could pull off their plans of making great electric cars mass market cars. There are cheaper options for electric, but they’re not as good IMO - they need to compete directly with the most desirable petrol cars. The other disadvantage Teslas have in Europe at the moment is that the full autopilot is not released here yet AFAIK, which makes them less valuable to my mind, and it will probably always trail the US developments, but they’ll get there eventually.

I’m not in the market for a car, but if I were, I’d now be willing to wait a year or two and aiming to buy a model 3 when the price comes down.

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I hold Tesla shares, happy to see my averaging down is working, with pre-market trading back in the green ( for now :crystal_ball: ) Woohoo :smile:

Dumbfounded on why it’s not fully premium for that price.

The main issue the incumbents are trying to create the iPhone as well. Look at the Porsche Taycan as one of many examples.

Really good to see someone saying NO to LIDAR, seems like we’ve been trapped in this bubble where all hopes rest on LIDAR. Taking it off the table will then hopefully allow other ideas to rise.

A bit like the Pixel then? :grin:

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The Google Pixel is a good piece of kit. Imagine if iOS ran on it :wink:

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Dumbfounded on why it’s not fully premium for that price.

This is an understandable reaction, but its actually objectively a better interior than the dated Model S/X (thats a negative as well as a positive I guess), and depending on who you ask, one of the best interiors of any premium sedan (I would say with the exception of the Alpha Giulia and Merc C class).

The full premium only gets you rear heated seats, an even better audio system and in-car streaming/browsing. Not really worth the the nearly ten grand upgrade imo, everything you (without sounding too much like Elon) “need”, is there already.

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