Research archive for TSLA

Tesla bears were kicked in the chops, after what looked like a miss in sales numbers the session prior, less than 15 thousand vehicles for the quarter, the company suggested that they would deliver somewhere in the region of 80 to 90 thousand vehicles for the year. Here are the sales numbers -> On Track for Full-Year Delivery Guidance. To put this into context, I read that last year there were 116 thousand electric vehicles sold globally, of the plug in kind. That sounded a bit low to me. Bearing in mind that the global car market is somewhere in the region of 83 million vehicles, China at 21.1 million and North America at 20.6 million. Europe sales were (including Russia) at 18.8 million units. Basically those three regions account for all of the consumer related vehicles, Toyota sold over 10.15 million units as the number one seller globally.

I know Byron is not a car guy, when you sit with someone all day long you get to know an awful lot about them. You had better enjoy your business partners as much as your family, you quite possibly spend more waking hours with them! Tesla however is a different kettle of fish, Byron was genuinely excited yesterday, comparing the launch of the Tesla Model 3 to the first iPhone. I guess with Tesla, this is dumbing their vehicles down in order to make them more affordable for environmental savvy folks across the world, and for those people who want to drive what is a beautiful vehicle. Watch -> Tesla unveils its $35,000 Model 3. And then also -> Meet Tesla's Model 3, Its Long-Awaited Car for the Masses.

I keep looking at the results of Tesla day after day and promising Michael that I will hammer them out tomorrow. And then of course something else happens. The company reported this time last week, at least I have the whole day over California, so it is not quite a week late: Tesla Fourth Quarter & Full Year 2015 Update. There are some pretty powerful things in there, that letter from Elon Musk to his fellow shareholders. The fact that the business is unique as a motor vehicle manufacturer, in that they still know everything about their car once it has left the assembly line. How many manufacturers of any sort can claim to know everything about their products (provided the user wants that) once they have sold it? I can't think of too many. Tesla continues to collect data from their users, with the Autopilot learning at a rate of 1 million real-world miles a day. That is pretty astonishing.

On the third of November we received third quarter earnings from electric car maker Tesla. I am sure the company needs no introduction. If you have not heard of Tesla or Elon Musk you are probably living in North Korea. Over there the fat man is just about to invent cars with a sixth gear. Here in the real world, Tesla is changing the face of automobile manufacture. Lets delve into the numbers first.

Despite opening lower both the Dow and the S&P 500 finished in the green, with the most interesting news coming from Morgan Stanley and their price target for Tesla. The 12 month price target was upgraded from $280 to $465. What! The current share price of just over $240 isn't even at their first price target of $280. (Morgan Stanley really, really loves Tesla) The reason for the huge upgrade is based on the hypothesis that Tesla will be a leader in the self driving car market, with the forecast being that the self driving market could triple the currently forecast 2029 revenues (forecasts 2 years out are sketchy, 14 years out will definitely be wrong). The market liked the upgrade, the shares popped 4.9%.

Tesla announced that they were going to be raising 500 million Dollars, Elon Musk is going to stick in 20 million of his own money to buy more shares at these levels. What for? I mean, what are they going to be using the money for is the better question? In the press release, titled Tesla Announces $500 Million Common Stock Offering: Tesla intends to use the net proceeds from this offering to accelerate the growth of its business in the United States and internationally, including the growth of its stores, service centers, Supercharger network and the Tesla Energy business, and for the development and production of Model 3, the development of the Tesla Gigafactory, and other general corporate purposes. So there you go, making progress and never sitting still.

Tesla shares sank over 8 percent last evening as the company indicated (after the session prior to yesterday) that they would miss their annual target of delivering 55 thousand motor vehicles for the year. Instead, it would be between 50 and 55 thousand. For a share price that is primed for perfection, this is obviously not the best news in the world. Musk has a plan though, as a shareholder there is going to have to be many lengths of patience during which you are going to feel underwhelmed by the present or the short term outlook. Having read the book about Musk, you get a sense that he thinks as long term as Jeff Bezos of Amazon.

Tesla released results last evening. Elon Musk is amazing, his energy is electric and contagious. His simplicity of explaining what is essentially a very complex product is the hallmark of a great businessman and can-doer. There are many people that would have approached the projects of space travel and make it cheaper (much cheaper), electric vehicles and better technology with very different methods. If at all. Yet he finds the time to immerse himself into these projects for the betterment of humanity, at the expense of his personal life. Sadly. I guess that is somehow how life works, the best and amazing people in terms of their business lives aren't as successful in their personal lives. Whatever makes you happy, I am all for it, pity nobody, be generous.

Oh, who would have thought that something of this nature was kept under wraps. Apparently there was a verbal agreement between Elon Musk and Larry Page, in which Google would have acquired Tesla for 6 billion Dollars back in 2013. This was revealed in a book on Elon Musk, from a writer of the name of Ashlee Vance. Ashlee writes for Bloomberg Newsweek. He shares something with Elon Musk and many of you, he was born here in South Africa, growing up in Texas however. The book itself has been available for pre order, only being released 19 May 2015. Well, good thing that Musk did not sell, Tesla has a market capitalisation of 26 billion Dollars. Good work for having not ironed out the kinks, on paper Musk is worth a whole lot more as a result of the company clicking at the right time. In another positive, around three quarters of a year on: Tesla's gigafactory is coming together, thanks to satellite images. Nice. Next set of news relatively soon, the last reporting quarter was 11 Feb, I guess some time in early May.

And then another South African born chap who continues to make huge progress in his adopted country, Elon Musk, caused excitement last evening with another simple tweet.

Tesla, the car company that makes the best looking electric cars in the world, released their Fourth Quarter & Full Year 2014 results on Wednesday night last week. Elon Musk, the founder and CEO went to Pretoria Boys, so this company has a soft spot with us in the office, seeing as both Paul and Byron went to that fine establishment. The results were not as great as the market were expecting, they had pencilled in a profit compared to the 4Q loss of $0.13 a share, resulting in a drop around 7% in the share price.

When owning companies, you are not owning a share price. You are owning the future profitability of that business and paying a price today for that. The collective try and figure out whether or not the price is right, right now. Tesla is a great example of that. What a business! They are trying to revolutionise the way we think about private transport and the combustions engine. However, the business does not make meaningful profits, if any. They are only going to sell 35 thousand vehicles this year, of the Model S that is. The expectations are for a run rate of 100 thousand vehicles next year.

What is Elon Musk doing? Would you do that? I am talking about his business, Tesla Motors, and what was released on his blog yesterday: All Our Patent Are Belong To You. Huh? Quite simple:

Tesla are raising 1.6 billion Dollars and taking this massive opportunity to put their best foot using the recent excitement around their results as a huge opportunity, through a convertible bond issue. First production in 2017, 500 thousand motor vehicles to be manufactured at what Elon Musk calls a "Gigafactory". Everyone is getting very excited about this. A what? Well, Tesla have a simple paper out, you can download it:

Yesterday Tesla finished up over 8%, significantly breaking the $200 mark for the stock. If you bought the stock today a year ago, you would have paid ... (wait for it) ... $35 a share. Yes a year ago you could have bought Tesla for $35 and today they are worth $210, so you would have made a cool 500% in a year.