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He hasn't logged in since his retirement post I thought? I am sure he has plan B and C in place. He thought it through before calling it retired at 40. Hope he is doing okay given the market situation. Almost all stocks are going back to its normal valuation...
All this recent TSLA news has me thinking about the poster who retired earlier this year and was heavily concentrated in TSLA. I think he said he was considering diversifying. I hope he did.
He talked about diversifying earlier, but by 2022 he had changed his mind and was adamant about staying heavily invested in Tesla. In one post he said the shares might go up to $20,000 or $30,000 (this was before the 3-for-1 split).
He's not that old, so if Tesla doesn't work out he has time and youth on his side.
He's not that old, so if Tesla doesn't work out he has time and youth on his side.
That's still a crushing blow, and a devastating setback, both emotionally and financially. Though I give short shrift (pun intended) to speculators or evangelists, it's still wrenching to witness the struggles of a fellow aspirant to early-retirement.
Thinking about Tesla as an automotive enthusiast, my impression of their products and their philosophy is actually very favorable. I wish that Nissan and Toyota and Ford and so on, made products more like the Model-3, and less like humdrum commuter-cars. Still, the financial hype swirling around Tesla is - and has been - just bewildering. Perhaps if their valuation starts to get more in-line with that of a mature tech company, say like Apple or Microsoft, it would be better for everyone (except for speculators or evangelists)?
That's still a crushing blow, and a devastating setback, both emotionally and financially. Though I give short shrift (pun intended) to speculators or evangelists, it's still wrenching to witness the struggles of a fellow aspirant to early-retirement.
I admire him for his conviction, and the story isn’t over yet. I’ve held a stock though similar declines and it eventually went on to higher highs. It took years to recover though, and it was not most of my net worth.
With that said, I do feel it was a poor bet to hold such a huge position, and add to it.
That's still a crushing blow, and a devastating setback, both emotionally and financially. Though I give short shrift (pun intended) to speculators or evangelists, it's still wrenching to witness the struggles of a fellow aspirant to early-retirement.
Thinking about Tesla as an automotive enthusiast, my impression of their products and their philosophy is actually very favorable. I wish that Nissan and Toyota and Ford and so on, made products more like the Model-3, and less like humdrum commuter-cars. Still, the financial hype swirling around Tesla is - and has been - just bewildering. Perhaps if their valuation starts to get more in-line with that of a mature tech company, say like Apple or Microsoft, it would be better for everyone (except for speculators or evangelists)?
Agreed, Teslas are overall good products but the stock price was insanity. I know someone who said Tesla would be 3500 by end of year. He said this in May when it was 700 presplit. I don't know what's crazier, the fact that he thought it would 5x to become 3.5tril in 7 months during a bear market, or the fact that he had family and buddies who believed him.
Hard to say how 2023 earnings progression will play out, but here's some reasons why it's still likely to grow relative to 2022, unless there is a deep 2008 like recession:
1) Most of the sales slowdown in the U.S. is due to people wanting to wait until 2023 to get the federal tax incentive (likely to end up at $3750 for Model Y). This was expected and evident in when Tesla started cutting prices in December by a similar amount, inventory plots show a rapid plunge.
So all other things being equal, I expect demand to be higher in 2023 than Q4 of 2022 in the U.S.
2) The government has not decided on the battery materials requirement part of the IRA, so until then all Tesla's that qualify based on price caps will get the full $7500 credit. That will be at least for Q1.
3) Europe demand doesn't seem to be slowing down yet.
4) Clear China demand is slowing down, how much due to economy vs Covid is not clear. China reduced ASP would be the main driver of lower EPS growth for sure. But some positives are Tesla can export more of these cars to other markets, including market they previously haven't engaged (for instance just recently Thailand). But this takes time to set up, so we'll see how well they manage.
5) Something no one has mentioned yet in this thread - Tesla Megapack Production is ramping fast and with potentially high margins.
The selling prices are known and the produce is sold out for 2 years. I believe this account is a bit overoptimistic, but the production rate is going to be enormous growth and will probably provide $1-$2 of EPS to 2023 alone.
6) Any increase in software revenues from FSD subscriptions as that software gets better. Big wildcard and hard to model at all. Could have 0 effect or could be big.
In total, worst case EPS for 2023 is probably $5. Q1 will probably print a very high EPS because of $7500 tax credit, but have a pull back in quarters after that. But the Energy contribution will help EPS grow even if Automotive EPS is flat (or declining if recession is bad).
The difference between $5 and $6 is huge in terms of EPS growth - changes from 25% to 50% YoY.
At end of 2023 if Tesla is at $5 TTM, with 25% growth, PE ratio of 30-40 = share price of $150 to $200.
If $6 TTM with 50% growth, PE ratio of 50-70 is more appropriate = share price of $300-$420.
This modeling assumes overall market has stopped going lower / appreciated a little bit as Fed has at very least stopped increasing rates by mid-year.
Hard to say how 2023 earnings progression will play out, but here's some reasons why it's still likely to grow relative to 2022, unless there is a deep 2008 like recession:
1) Most of the sales slowdown in the U.S. is due to people wanting to wait until 2023 to get the federal tax incentive (likely to end up at $3750 for Model Y). This was expected and evident in when Tesla started cutting prices in December by a similar amount, inventory plots show a rapid plunge.
So all other things being equal, I expect demand to be higher in 2023 than Q4 of 2022 in the U.S.
2) The government has not decided on the battery materials requirement part of the IRA, so until then all Tesla's that qualify based on price caps will get the full $7500 credit. That will be at least for Q1.
3) Europe demand doesn't seem to be slowing down yet.
4) Clear China demand is slowing down, how much due to economy vs Covid is not clear. China reduced ASP would be the main driver of lower EPS growth for sure. But some positives are Tesla can export more of these cars to other markets, including market they previously haven't engaged (for instance just recently Thailand). But this takes time to set up, so we'll see how well they manage.
5) Something no one has mentioned yet in this thread - Tesla Megapack Production is ramping fast and with potentially high margins.
The selling prices are known and the produce is sold out for 2 years. I believe this account is a bit overoptimistic, but the production rate is going to be enormous growth and will probably provide $1-$2 of EPS to 2023 alone.
6) Any increase in software revenues from FSD subscriptions as that software gets better. Big wildcard and hard to model at all. Could have 0 effect or could be big.
In total, worst case EPS for 2023 is probably $5. Q1 will probably print a very high EPS because of $7500 tax credit, but have a pull back in quarters after that. But the Energy contribution will help EPS grow even if Automotive EPS is flat (or declining if recession is bad).
The difference between $5 and $6 is huge in terms of EPS growth - changes from 25% to 50% YoY.
At end of 2023 if Tesla is at $5 TTM, with 25% growth, PE ratio of 30-40 = share price of $150 to $200.
If $6 TTM with 50% growth, PE ratio of 50-70 is more appropriate = share price of $300-$420.
This modeling assumes overall market has stopped going lower / appreciated a little bit as Fed has at very least stopped increasing rates by mid-year.
Another crazy price prediction. $420 really, why has Elon been selling all year then? If he can triple his money in less than a year then shouldn't he be backing up the truck...
I love EVs but I just don't see this happening. There's one charging station at my grocery store with 2 plugs and it's always taken. What will happen when every car in the parking lot is an EV? People in apartments and condos can't charge where they live so they'll have to depend on public stations and those are few and far between.
The wait time for an EV has been months due to labor and parts shortages. How are they supposed to make every new car an EV if they can't even keep up with the low demand now? I read something like there isn't enough lithium in the world for all the batteries. ICE cars last decades but EV batteries have a shelf life of what, 8 years? Then you have to buy a new one?
There are so many anti EV, gas enthusiasts out there. Every EV article or ad I see on social media is filled with anti EV comments.
It's winter now and range drops significantly. The most popular car in America is the Ford F150 and most of those owners don't want the EV version. The F150 Lightning towing range is only 77 miles or something abysmal, and that's in warm weather.
Until EVs cost the same or less than ICE vehicles, they will not be adopted by the masses.
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