tesla motors

[noxiousdog]

Or the emperor has no clothes. There's plenty of those too.

True, that.

Speaking of Amazon, looks like investors might be getting tired of no step 2.

[Carpet_pissr]

What was step 2 again?

M* has it ranked as 4*, with a $400 fair value, while Zack's has it pegged at UNDERPERFORM/HOLD, fair value $298.

Interesting. Not so unusual, but interesting.

[noxiousdog]

What was step 2 again?

????

[Zaxxon]

Well, we now know that it certainly wasn't 'release gimmicky Fire Phone'.

[noxiousdog]

What was step 2 again?

M* has it ranked as 4*, with a $400 fair value, while Zack's has it pegged at UNDERPERFORM/HOLD, fair value $298.

Interesting. Not so unusual, but interesting.

Here's food for thought:
Over the last 5 fiscal years, Amazon increased revenue from 24.5 B to 74.4B. During the same time frame, Wal-mart went from 408B to 476B. Walmart has larger margins.

Walmart is valued at 245B making 26B per year.
Amazon is valued at 134B making less than 1B per year.

Unless Amazon can translate sales into profits, their value is minimal. And yes, there is high[er] margin value in cloud computing, but I don't know if there is enough of it to goose margins significantly.

[LawBeefaroni]

Here's food for thought:
Over the last 5 fiscal years, Amazon increased revenue from 24.5 B to 74.4B. During the same time frame, Wal-mart went from 408B to 476B. Walmart has larger margins.

Walmart is valued at 245B making 26B per year.
Amazon is valued at 134B making less than 1B per year.

That's that irrationality I was talking about. The lust for growth. In those 5 years, AMZN is up 600% and WMT is up 32%. Granted WMT pays dividends and AMZN doesn't but that can't all be divys.

What was step 2 again?

M* has it ranked as 4*, with a $400 fair value, while Zack's has it pegged at UNDERPERFORM/HOLD, fair value $298.

Interesting. Not so unusual, but interesting.

FWIW, Credit Suise has a $325 12 mo price target (as of 10/13/2014; outperform) and S&P has $245 (10/17/2014; 3-stars AKA hold).

[noxiousdog]

That's that irrationality I was talking about. The lust for growth. In those 5 years, AMZN is up 600% and WMT is up 32%. Granted WMT pays dividends and AMZN doesn't but that can't all be divys.

FWIW, Credit Suise has a $325 12 mo price target (as of 10/13/2014; outperform) and S&P has $245 (10/17/2014; 3-stars AKA hold).

BUT BUT EMT!!!!!!!

[Zaxxon]

You guys may want to move to the OIC thread.

[LawBeefaroni]

You guys may want to move to the OIC thread.

With it's current valuation, TSLA is as much a stock company as it is a car company.

[Zaxxon]

That's true, but no one's talking about TSLA.

[noxiousdog]

That's true, but no one's talking about TSLA.

I understand we are mucking up your thread, but you're the one that started talking about investors.

[LawBeefaroni]

That's true, but no one's talking about TSLA.

Much in the same way that talking about the Chevy Volt is not talking about TSLA.

Relative valuations and how they are arrived at are important in evaluating TSLA the stock.

[Zaxxon]

Talking abut the Volt, or AMZN and relating them to Tesla/TSLA would be cool. That hasn't happened on this page. I see I'm in the minority, so carry on.

[LawBeefaroni]

Talking abut the Volt, or AMZN and relating them to Tesla/TSLA would be cool. That hasn't happened on this page. I see I'm in the minority, so carry on.

Oh, so the problem is pagination? Because how we got to AMZN from TSLA is pretty clear if you go back one page.


The point is that TSLA is still a growth company and its valuation is largely based on future expectations rather than any current business. Which is fine, but that makes it more like Twitter or Amazon than Ford or Boeing.

As such, when talking about how to value TSLA it's perfectly reasonable that the conversation might veer off into discussing how comparable (or non-comparable) companies are valued.

Company	Market Cap	Revenue	Earnings (MRY)	PE(TTM)	Dividend	Inst own
BA	$86B	$86.6B	$4.6B	17.27	2.40%	76%
TSLA	$29B	$2.1B	$-74m	NA	0	55%
TWTR	$30B	$0.664B	$-645M	NA	0	54%
F	$53B	$146.9B	$7.2B	8.48	3.62%	56%
AMZN	$144B	$74.5B	$274M	NA	0	67%

That's not to say the valuation is impossible but right now TSLA is in the "must grow at all costs" phase. Kind of what Amazon is emerging from and what TWTR is still in. It is a critical point for a company regardless of the quality of their product/service.

[Zaxxon]

I get it. There just wasn't any active comparison happening. Carry on.

[noxiousdog]

Also, to clarify: Musk doesn't see 100k produced in 2015. He sees ending 2015 at a 100k run rate.

I listened to the second quarter conference call, and he thinks he can get to 200k cars/yr without the Gigafactory.

[Zaxxon]

Yes. To clarify again, they've stated two separate things:

1) That they plan to exit 2015 at a 100k run rate. Therefore they plan to produce fewer than 100k cars in 2015, but to be producing at a 100k annualized rate by 12/31/2015.

2) That they can, with some prodding of Panasonic, conceivably produce up to 200k cars/year prior to the Gigafactory coming online in 2017.

It will be interesting to see whether we get more specific 2015 production guidance on the 11/5 Q3 conference call. Musk has estimated that we will see 15k-20k Model X in 2015 as recently as last month on a Fox Business interview. Given that and the expected 100k run rate, my guess is that we'll likely see 60k-70k Model S next year, plus 15k-20k Model X. It certainly can't be much more than that unless they're significantly sandbagging the run rate.

[noxiousdog]

Even more significant, some one asked if we could see a $100/kwh battery in ten years, and Musk thought about it and said, "I'd be disappointed if it took us ten years." Also, agreed with the analyst that says that on parity or slightly less than internal combustion engines.

That's pretty good news for everyone.

[Zaxxon]

Yup. He also made a comment along the lines of 'in the past, we've had our cards on the table [by necessity since folks by and large questioned whether they'd survive]; now we aren't disclosing everything R&D is doing.' A part of that proved to be that they were further along with autopilot than previously discussed. I don't think that's all of it, though.

[Carpet_pissr]

Even more significant, some one asked if we could see a $100/kwh battery in ten years, and Musk thought about it and said, "I'd be disappointed if it took us ten years." Also, agreed with the analyst that says that on parity or slightly less than internal combustion engines.

That's pretty good news for everyone.

Except oil companies. Those poor bastards, surely they see the writing on the wall.

[Isgrimnur]

Electricity still has to be generated, and fossil fuel power plants are still a thing. It's not going to be their day in the sun, but they won't be shutting the doors any time soon.

What happens to the electrical grid when all the power that's been going over the roads in the back of tankers all of a sudden has to go through our aging electrical infrastructure?

[Zaxxon]

Electricity still has to be generated, and fossil fuel power plants are still a thing. It's not going to be their day in the sun, but they won't be shutting the doors any time soon.

Interesting choice of words, since the sun is also going to eat away at their volume before too long. But yes, oil will be needed and used for a very long time even if all vehicles change to electricity. Plastics, etc.

What happens to the electrical grid when all the power that's been going over the roads in the back of tankers all of a sudden has to go through our aging electrical infrastructure?

Well, first, only a fraction would need to switch to hit the electrical infrastructure--EVs are an order of magnitude more efficient than gas-powered vehicles. For example, the stored energy of Tesla's 85 kWh pack (by far the largest EV pack in the world) is the equivalent of fewer than three gallons of gas--and it'll go 250-300 miles depending on conditions. Second, in the next few years solar-powered homes with stationary off-grid storage will become a thing.

But it's true that the way grid power is sold will have to change significantly in the next decade or so.

[geezer]

So, while valuation of the company is interesting, I just test drove the new P85D model, and damn. It's the most powerful thing I've every had the pleasure of wheeling around. Stronger off the line than my (640 hp) Viper. Additionally, the new seats are a vast improvement over the previous models, and the car as a whole was surprisingly agile and competent. All in all, a definite upgrade over the previous P85 models. I do have a few questions, which I'll try to answer on a longer drive soon - specifically what does the AWD car give up to the RWD car in handling dynamics, and how is the pulling power at highway speed? I'm slightly concerned about the former, hardly concerned at all about the latter. But the sticker was 130K. Ouch.

Edit - one amusing thing stood out. In most cars you can choose between "sport" and "normal" mode, or something similar. In this one the choice is "sport" or "insane" (yes, it says "insane" right on the mode selector.)

[coopasonic]

specifically what does the AWD car give up to the RWD car in handling dynamics

Powered front wheels gives the computer more options to deal with various situations. As long as the programming is right, it shouldn't give much of anything up. Caveat: I don't know anything.

[Zaxxon]

Specifically, Tesla's AWD shouldn't give anything up. Their system isn't a 'dumb' mechanical linkage as with traditional AWD. It's instant torque independently generated on each axle.

[geezer]

Specifically, Tesla's AWD shouldn't give anything up. Their system isn't a 'dumb' mechanical linkage as with traditional AWD. It's instant torque independently generated on each axle.

It still gives something up. What follows is exceedingly simplifed, but.... any tire has a certain amount of grip it can offer. if a given tire is being used to generate forward propulsion, the available lateral grip is lessened, hence the tendency of FWD and AWD cars to understeer. So if you're in a turn, and the car decides that torque needs to be applied to the front wheel(s), you're going to give up some lateral grip and lose some of the rearward-bias that tends to give a car more dynamic options.

That's not to say that there aren't situations where the tradeoff works and is preferable - even in racing applications. It's really just an academic question regarding the "feel" of the two setups. The P85D doesn't really have pretensions of being a track car, and I suspect that whatever the difference in feel is, it wouldn't have a very negative impact on the overall capability of the car.

[geezer]

specifically what does the AWD car give up to the RWD car in handling dynamics

Powered front wheels gives the computer more options to deal with various situations. As long as the programming is right, it shouldn't give much of anything up. Caveat: I don't know anything.

Right, but sometimes what the computer wants and what the driver wants aren't in harmony. Specifically, if I'm running a decent slip angle in the rear, the car may attempt to compensate. As I said, I have no idea what Tesla's threshold and programming are, but there are very few cars - Nissan's GTR and Porsche's AWD logic are the only ones that I've experienced - that can do it correctly.

[Carpet_pissr]

And you thought someone here could answer that question better than yourself?

[LawBeefaroni]

And you thought someone here could answer that question better than yourself?

Well, he did say he'd try to answer them himself on the track.

[geezer]

And you thought someone here could answer that question better than yourself?

Well.. no. (But who knows - maybe?) But I was just sort of speaking my thoughts out loud because I know a bunch of folks here are curious about the car.

[Carpet_pissr]

And you thought someone here could answer that question better than yourself?

But I was just sort of speaking my thoughts out loud because I know a bunch of folks here are curious about the car.

No doubt, and I love LOVE the fact that they are cool enough to actually put "insane" on a label in the car. Even most sport car companies are so frumpy and conservative (not talking about styling here, but business culture), not to mention the mainstream ones, that that's like a whiff of fresh air just reading about it.

$130K is above my paygrade though, for a car purchase. If I ever get one, it will have to be a lot more reasonably/practically priced than that. Hopefully they will put that "insane/sport" mode in some of the lower priced models as well.

[Zaxxon]

$130K is above my paygrade though, for a car purchase. If I ever get one, it will have to be a LOT more reasonably/practically priced than that.

The rest of this post falls under 'first-world problems'.

Note that while the P85D can easily surpass $130k, it can be had for $117k... which is also a crazy amount of money for a car (but my entry-level understanding is that it's not actually very high for a car of the P85D's performance level--geezer can more accurately speak to that, I imagine). The Model S starts at $71k, though, and in many states that's well under $60k after incentives. Drop another $10k in lifetime fuel savings, and while it's not cheap, it's not so insanely priced given its performance. Sure, that's for the 60 kWh model, but having driven the 60, it's no slouch.

And I concur about having the balls to actually label an 'insane' mode as such. Hopefully Tesla doesn't lose any more of that spirit than necessary as they grow.

[Zaxxon]

Speaking of the P85D... Tesla had a test-drive event this past weekend, and for some reason saw fit to invite me. I wasn't about to say no, so a friend and I got about 45 minutes behind the wheel of the P85D.

Holy shit.

This was my 4th Tesla test drive. I had previously driven the initial P85 in late 2012, a 60 and a P85+. Those are all fast, especially the Ps. But the D is just a whole different ballgame. My friend drove first, and as the event was downtown we quickly found ourselves at a stoplight. The Tesla rep suggested that he gun it, and that we all place our heads against the headrest, facing forward. He gunned it, and I can say in all seriousness that I felt like I was going to black out. It was incredible. All Teslas deliver their torque instantly, but the P85D just has so friggin much of it, and the AWD allows it to all be used without any spinning out.

The fit and finish was a step up from the initial year's worth of vehicles, as well. I had seen mention that Tesla has made hundreds of minor adjustments since the launch of the S, and that has borne some fruit.

We also got to test the initial implementation of autopilot, which currently is limited to speed limit recognition, lane departure warning, and traffic-aware cruise control. The latter was quite cool--set a cruise speed, say 40 mph, and a following distance, and then just handle steering. The car will follow the vehicle ahead of you, up to your set speed limit, and including stops and starts.

Is it 2017 yet? Where's my $35k Tesla?

[coopasonic]

All Teslas deliver their torque instantly, but the P85D just has so friggin much of it, and the AWD allows it to all be used without any spinning out.

The AWD and lots of sensors and computer processing allow the maximum amount of it to be used with minimal traction loss. You are unlikely to be able to use all of it, but they do their best to make sure you can use the greatest possible amount of it in the given conditions.

To pick nits.

[Zaxxon]

Car go fast. Feel good.

[LordMortis]

Is it 2017 yet? Where's my $35k Tesla?

I just hope my house can support the draw. Otherwise, I'm out.

What's the tax break on this one supposed to look like?

Also, remind me to buy Tesla with my 2016 IRA.

[Zaxxon]

I just hope my house can support the draw. Otherwise, I'm out.

You can charge on a regular outlet. You'll only get a handful of miles back per hour, but you can do it. The most common option is to install a NEMA 14-50 outlet (50 am circuit, 40-amp continuous load).

What's the tax break on this one supposed to look like?

The tax incentive will still be $7500, barring a change in the law or a big Model 3 delay. It's calculated on a per-manufacturer basis, and doesn't start phasing out until 200,000 vehicles (US vehicles only). After that, it goes to $3750 2 calendar quarters later and stays there for 6 months, then goes to $1875 for another 6 months before it's gone. However, this is a non-refundable credit, so you need to have $7500 in tax liability in order to claim the full amount.

[LordMortis]

However, this is a non-refundable credit, so you need to have $7500 in tax liability in order to claim the full amount.

No single income in a marriage credit. No children credit. No mortgage credit. No work write offs. $7500 would not be a problem.

I don't think installing "a NEMA 14-50 outlet (50 am circuit, 40-amp continuous load)" is going to work for me though. I have enough electrical problems and fights with DTE. Introducing more problems does not sound like fun.

[stessier]

I don't think installing "a NEMA 14-50 outlet (50 am circuit, 40-amp continuous load)" is going to work for me though.

Come to the Volt thread! Same tax credit and it charges on 110V circuit in 13 hours (ish) or 4.5 hours on a 240V circuit.

[Zaxxon]

Sorry to hear about the electric problems. Cool to hear about the tax situation. You can get a feel for charge time with various outlets and daily mileages here. The Model 3 will probably be smaller and a bit more efficient than the S, so mentally reduce those times/costs slightly.