Will Elon Musk and TSLA survive?

[x3 skier]

Is Musk blowing smoke again about going private?

“Musk has a bizarre plan for Tesla”

https://www.wsj.com/articles/teslas-go-private-dream-doesnt-add-up-1533677506?emailToken=650dda2d91770115c06f95d581da8991ZvMfqWTDuGsFjN716h14VqpNXilJmdGrSGLbJ2vTXK6Mo9/IV7FPw66qAFB19ZSF0vO5NSNk52AFePbGaPkIDuVL/wHaarsEsO2hXhfmzh4=&reflink=article_email_share

Cheers

 

[bizaro86]

It seems unlikely that he could raise the money to take out the rest of the shareholders to me. None of the funds, etfs, or small investors could realistically hold Tesla shares after they go private, so he needs to raise tens of billions of dollars. Tesla can't support the debt it has now, so that is all equity. Who is writing that cheque?

 

[dominidude]

I hope Tesla does go private.
Though Mr Musk is certainly far from perfect, his heart seems to be in the right place.

 

[x3 skier]

I hope Tesla does go private.
Though Mr Musk is certainly far from perfect, his heart seems to be in the right place.

IMNSHO, his heart is in his wallet

Cheers

 

[LisaH]

He is a visionary, albeit a crazy one! He is just squeezing the short sellers, and did a great job this week. I sold my shares a while ago. Wish I still hold onto them...

 

[bogey21]

I also feel that what he is trying to accomplish is to get the short sellers to rethink their positions...

George

 

[bizaro86]

If his goal is truly (as he stated) to accelerate the adoption of electric cars, then he has largely succeeded. Porsche et al are now making big bets on battery powered vehicles. I think they will probably be able to supplant Tesla, and in my opinion the company is vastly over priced at its current market value.

On the other hand, the man knows how to play the stock market like a fiddle. I would never short TSLA, because the potential for pain is too high. I did open up a bear put spread though, because in my opinion when the go-private doesn't happen, the shares are probably going down.

 

[x3 skier]

The problem is that he said he has financing (several tens of billions of dollars) in hand. If that’s true, no problem, if not then he’s committing a type of action that the SEC may decide is illegal and solely to manipulate the stock price.

Regardless, if it turns out to be true, he’s going to have a lot bigger set of investors who might be less patient waiting to get a return on their money than current holders and analysts. Maybe it’s the Chinese.

We’ll see shortly if it’s more of a pump and dump or a real strategy.

Cheers

 

[LisaH]

As a not-too-sophisticated investor, I don’t get why hedge fund managers sell short. Wouldn’t buying a put achieves the same goal with less risk? I guess short selling is probaly more profitable when things go in the right direction.

 

[x3 skier]

Looks like things will get interesting according to the Wall Street Journal

“SEC Probes Elon Musk’s Tweets”

https://www.wsj.com/articles/sec-ha...sYIyxnYBxR/5GyV2w&reflink=article_email_share

Cheers

 

[Passepartout]

I really don't care whether Musk &/or TSLA survive. They have already kick-started the electric vehicle and battery industry. Every manufacturer has electric/hybrid/plug-in vehicles either on showroom floors, or consumer ready. Frankly the thing holding back popular adoption of the various technologies is cheap gas. If all-of-a-sudden, gas became $8 a gallon or you could only buy 2-3 gallons at a time, electric vehicles would fly out of the showrooms.

Jim

 

[bizaro86]

As a not-too-sophisticated investor, I don’t get why hedge fund managers sell short. Wouldn’t buying a put achieves the same goal with less risk? I guess short selling is probaly more profitable when things go in the right direction.

Puts on Tesla are really expensive, because so many people want them, so if you have high certainty a short is better. It's much higher risk though.

Also, if you're a big hedge fund there is much more liquidity in the stock. If you need to have a 50 million dollar position to make it worth your while, it would be tough to buy that many puts, they just aren't available.

 

[x3 skier]

SEC Sues Musk For Fraud, Seeks Exit From Tesla - The Wall Street Journal.

https://www.wsj.com/articles/elon-musk-sued-by-the-sec-for-securities-fraud-1538079650?emailToken=c80a186d8decb2ee6838730f8c8de2d7Rtp+7Qhuatq55r6d7Lpampl7PWDcysjgew/Tu0OhDQEqD1sYSJ3i3cr8Cv4+Fjdssh1hRPwQM6IGkVTlbsnJwl4KVBVi2kDFZ2mPD8/t8/o=&reflink=article_email_share

Doesn’t look good.

Cheers

 

[controller1]

I agree that it doesn't look good. The SEC is nearly always able to settle these types of cases. To have to file a case, IMO shows how brash Musk is.

 

[T_R_Oglodyte]

As a not-too-sophisticated investor, I don’t get why hedge fund managers sell short. Wouldn’t buying a put achieves the same goal with less risk? I guess short selling is probaly more profitable when things go in the right direction.

Another difference is that puts have an expiration date.

As a money manager, or investor, you may be sure convinced that the stock price can't be supported, and is going to come back to earth. But it's hard to know when, especially if there is a bit of mania surrounding the stock. Going short eliminates that time factor.

 

[Talent312]

SEC Sues Musk For Fraud, Seeks Exit From Tesla - The Wall Street Journal...

If they succeed in kicking him out, it could be the best thing for Tesla.
They might have to hire competent management.
.

 

[Ken555]

If they succeed in kicking him out, it could be the best thing for Tesla.
They might have to hire competent management.

I think it’s time for me to watch the movie Tucker again...


Sent from my iPad using Tapatalk

 

[T_R_Oglodyte]

If they succeed in kicking him out, it could be the best thing for Tesla.
They might have to hire competent management.
.

I think it's too late already. BMW, Mercedes, and Toyota are taking dead aim at the same market. Tesla is competing against formidable competitors who know more about how to design automobiles and build automobiles, who are better financed, and who have comparable engineering talent with experiences putting electric motors in cars.

IMHO - for Tesla to succeed, they needed to be about two years faster on their product cycle than they have been. They they would have had product on the market that competitors were still trying to catch up to. Meanwhile they would be finishing their next product cycle, and would roll out that new product about the same time the competitors were just starting to compete with their now old offerings. Keep up the cycle, and that's how you bury competitors with innovation.

Musk had ideas - and I suspect that a lot of them weren't practical. But his tinkering to check things out slowed down the work of actually getting their new models out and in sales.

Frankly, I'm not sure that his ideas are all that tremendous anyway.

 

[bogey21]

I think it's too late already. BMW, Mercedes, and Toyota are taking dead aim at the same market. Tesla is competing against formidable competitors who know more about how to design automobiles and build automobiles, who are better financed, and who have comparable engineering talent with experiences putting electric motors in cars.

Agree...

George

 

[vikingsholm]

Sometimes I think about adding P T Barnum to that comparison Except Musk actually does deliver some actual working devices, albeit in most cases, not profitably. Between Space X (works) and Hyperloop (pipe dream) and Tesla cars (in between), his ideas are all over the map.

Cheers

Not to mention his most Boring product, the underground tunneling borer machine.

Chicago signed on to have it used for digging a tunnel and build a privately financed rapid transit system to go from downtown to O'Hare airport, and they also have other potential projects in LA. Will watch those with interest.

https://www.npr.org/2018/06/14/6199...d-high-speed-train-to-chicago-s-o-hare-airpor