Tesla Research

Fallacy Alarm
Feb 10, 2023
Share
Fallacy Alarm
Resetting expectations for Tesla (incl. Excel workbook)
For my initial read on Tesla’s 3Q23 earnings, please check out the article below. This is a follow-up on that assessment.Fallacy Alarm is a reader-supported publication. To receive new posts and support my work, consider becoming a free or paid subscriber…
Read more
a year ago · 11 likes · 3 comments · Fallacy Alarm
Fallacy Alarm
TSLA 3Q23: Depressed Elon.
Today, Tesla announced their 3Q23 earnings. It was a clean miss with non-GAAP EPS of $0.66 (vs. $0.72 expected) and $23.4bn revenues (vs. $23.9bn expected). I have mixed feelings about this earnings release. On the one hand, I am disappointed about Tesla’s present operating performance and Elon’s depressed vibes on the earnings call. But on the other h…
Read more
a year ago · 19 likes · 7 comments · Fallacy Alarm
Fallacy Alarm
TSLA: Big upgrade from Morgan Stanley!
Adam Jonas of Morgan Stanley detonated quite the bomb tonight with his latest client note on . He raised his price target by 60% from $250 to $400. Even more important, he upgraded the stock from equal-weight to overweight and as a cherry on top, he named them his “Sector Top Pick” which had been Ferrari…
Read more
a year ago · 11 likes · 11 comments · Fallacy Alarm
Fallacy Alarm
The Tesla Transformation 2030 (incl. Excel Model)
Check out my interviews with Randy Kirk on options and futures trader positioning and on recent bond market volatility. “If you have visions, you should go see a doctor.” Helmut Schmidt, German Chancellor 1974-1982 A resigning CFO, a billionaire cage fight, surging car financing rates, price cuts, product delays, sequentially falling EPS. Being a Tesla investor is always challenging. And these days are not an exception. Focusing on the big picture will help maintain (and potentially regain) clarity on the investment thesis…
Read more
a year ago · 21 likes · 2 comments · Fallacy Alarm
Fallacy Alarm
Tesla 2Q23: Patience is a Virtue
Today, Tesla announced their 2Q23 earnings. It was a solid beat against unambitious expectations. $24.9bn revenues were $300m ahead of consensus. $0.91 EPS was $0.11 ahead. Automotive and Services drove this beat, while Energy came in below expectations…
Read more
a year ago · 12 likes · 8 comments · Fallacy Alarm
Fallacy Alarm
Supercomputers: A tale of shovels and nuggets.
Check out my interview with Randy Kirk on the May 2023 CPI report here…
Read more
a year ago · 17 likes · 11 comments · Fallacy Alarm
Fallacy Alarm
Why is Tesla stock so manic?
hit $247 tonight in AH trading, 10% higher than yesterday at close. On the surface, this was driven by ‘s adoption of Tesla’s supercharger network contributing to the trend to make them the Standard Oil of the Electrical Age. $60bn value creation in a day. Mary led. Tesla shareholders into nirvana…
Read more
a year ago · 5 likes · 2 comments · Fallacy Alarm
Fallacy Alarm
Mobileye 1Q23: Cross-Read for Tesla FSD
On April 27, 2023, reported their 1Q23 results. Revenues were $458m, up 16% YoY. Net loss widened to -$79m vs. -$60m vs. 1Q22. They reduced their 2023 guidance meaningfully, most importantly revenue by 6.5%. This was primarily driven by weak macro, particularly in the Chinese EV market. But interestingly, they referred directly to…
Read more
a year ago · 6 likes · Fallacy Alarm
Fallacy Alarm
Sell the rumor, buy the news?
In past articles, I argued that the investment case has transitioned from ‘disruptive growth’ to ‘growth at a reasonable price’ (GARP). GARP is a very popular market segment, appreciated by investors for its predictability and because it is straight forward to value…
Read more
a year ago · 13 likes · 5 comments · Fallacy Alarm
Fallacy Alarm
TSLA 1Q23: 3 months nope, 3 years dope
Competition and Margin Pressure After hitting its GFC low in 2009, surged and 10xed by 2012. Introduced in 2007, the iPhone conquered the world during those formative years for the third iteration of the company that made it what it is today. But then the stock dropped 30% out of nowhere, while broader markets continued marching along. This drop had two…
Read more
a year ago · 16 likes · 4 comments · Fallacy Alarm
Fallacy Alarm
Quantifying the Tesla Insurance Opportunity (incl. Excel Model)
This article is part of a series where I am attempting to quantify the midterm EPS potential for Tesla. Eventually, I will build a 3-5y model with an approach that is similar to how I modelled my 2023 EPS estimate here. To develop this model, I have so far looked at…
Read more
a year ago · 11 likes · Fallacy Alarm
Fallacy Alarm
What's the Value of Tesla FSD? (incl. Excel Model)
On December 17, 1903, Wilbur and Orville Wright pushed their Wright Flyer onto a field near Kitty Hawk, North Carolina. Orville got in and they launched. He landed 12 seconds and 120ft later. It was the first controlled, sustained flight of a powered, heavier-than-air aircraft. A sensation…
Read more
2 years ago · 11 likes · 1 comment · Fallacy Alarm
Fallacy Alarm
Fluence 1Q23 cross-read for Tesla Energy
I view the battery as one of the most important economic goods of the coming years and decades. It will enable us for the first time to store energy at large scale outside of fossil fuels. I know you can’t dig batteries out of the ground like oil, you have to manufacture them. But in principle it is a commodity just like oil. Semiconductors fall into this category as well…
Read more
2 years ago · 1 like · Fallacy Alarm
Fallacy Alarm
What might Tesla Finance look like? (Excel Model included)
In my latest article about updating my 2023 EPS estimate, I mentioned that there may be a near-term opportunity for to venture into Consumer Finance. The occasion for that was Adam Jonas’ question on the earnings call to which Zach Kirkhorn responded that ‘the plumbing is in place…
Read more
2 years ago · 4 likes · Fallacy Alarm
Fallacy Alarm
Update of my TSLA 2023 EPS Estimate based on 4Q22 Earnings (Excel Model included)
On Dec 27, 2022, I published the article below. The stock had crashed to $106 and many people called for the total collapse to way below $100. In that article, I hypothesized that chances for a quick V-shaped rebound are actually quite good. Today, one month later, the stock actually sits at $160, 50% higher. I have a much bigger V in mind, but I have not had many wins to celebrate over the past year. So I am taking the opportunity to celebrate this one…
Read more
2 years ago · 7 likes · Fallacy Alarm
Fallacy Alarm
What might Tesla's 2023 EPS look like? (Excel Model included)
In my last article, I have argued that Tesla’s valuation has transitioned from (unprofitable) explosive growth to GARP (Growth At Reasonable Price). This gives two metrics outsized relevance in its price discovery process: P/E and EPS. For the first time in its history, its EPS is significant enough to build an investment case based on earnings and assigning a multiple to it. You can observe this phenomenon when you compare public discourse about the stock now vs. two years ago. Very few people talked about P/E and EPS back then. Today, those metrics often take the centerstage…
Read more
2 years ago · 6 likes · 2 comments · Fallacy Alarm
Fallacy Alarm
What is a fair P/E ratio for Tesla?
The Relevance of P/E for Tesla For most of its history, was loss making, which made it challenging to value. Unprofitable growth companies need to be assessed differently from those that have proven their business model by achieving profitability. The essence of growth investing is to figure out a) the point in time when the company will breakeven and b…
Read more
2 years ago · 19 likes · 5 comments · Fallacy Alarm
Fallacy Alarm
9 Reasons why TSLA might see a V-Shaped Recovery
Merry Christmas, friends! I don’t know about you, but I am kind of limping towards the close of 2022. The reason for that is obviously my heavy exposure to which seems to be heading towards an utter implosion. It will not fall 5% a day forever though. At some point this brutal sell-off will end and it will be replaced by a new phase. Will it be a violent…
Read more
2 years ago · 7 likes · 10 comments · Fallacy Alarm
Fallacy Alarm
Quo vadis, Tesla?
I own stock since 2017 and this is certainly the most brutal time I can remember. It’s not just that we are now officially in the largest correction the stock has ever had. It’s also the fact that it came completely unexpected. The company does not have the problems that hammered down…
Read more
2 years ago · 6 likes · 2 comments · Fallacy Alarm
Fallacy Alarm
Tesla 3Q22 earnings digest
Media coverage for is enormous and I can imagine you don’t need my two cents to get a decent picture. But I just wanted to share some of my initial thoughts on those aspects that I believe are underappreciated based on the comments I am seeing out there…
Read more
2 years ago · 2 likes · 1 comment · Fallacy Alarm
Fallacy Alarm
Tesla 2022 AI Day Digest
Putting it into context Before you read my commentary on 2022 AI Day, I’d encourage you to check out my preview from back in June in which I outlined why I am pumped about Tesla’s move into robotics. In that article, I have presented Real World AI (RWAI) as an innovation platform that will rival previous computing revolutions such as Personal Computing, …
Read more
2 years ago · 4 likes · 5 comments · Fallacy Alarm
Fallacy Alarm
Where is Tesla's demand cliff?
The health of the production constraint thesis When I was young, there was a company named Wiesmann near my hometown that specialized in designing and manufacturing stunning retro style sports cars with a modern touch: The company was founded in 1988 and had a loyal fanbase for whom they hand-built 180 vehicles per year. Business went well and Wiesmann ev…
Read more
2 years ago · 8 likes · 1 comment · Fallacy Alarm
Fallacy Alarm
How (not) to handle the Tesla Beast in the 2020s
Mental vs. analytical aspect of Investing It is not difficult to infer from my articles so far that I am a huge Tesla bull. I mention them in almost every piece I write, which is why I am actually concerned this obsession will repel some of you over time. But I hope my posts are generalized enough in nature that you can take away something useful from th…
Read more
2 years ago · 6 likes · 4 comments · Fallacy Alarm
Fallacy Alarm
The truth about Tesla's cash flow and capex
Tesla is becoming more and more of a cash machine, which is quite remarkable given how sticky the narrative has been that they can only make money on emission credits. Two years ago, when I encouraged a friend to buy TSLA even at $960 a share ($180 post-split), he was concerned how overvalued it was and I could not blame him given the run the stock had …
Read more
3 years ago · 5 likes · 1 comment · Fallacy Alarm