Stocks and Trading Thread - Channeling your inner Mono

[Tamas]

What am I missing on Tesla?  Is everyone just bored to death due to Covid, and is trying to set the Guiness world record for the biggest tulip bubble?

No idea but at this stage it is the next Bitcoin. Utter madness.

There is even a copycat stock out there called Nikola I shit you not, they claim to be working on an electric truck. I saw something mentioned on the aforementioned Discord that some people on twitter went to their factory address and made photos and it is basically a remote farm.

[Admiral Yi]

What am I missing on Tesla?  Is everyone just bored to death due to Covid, and is trying to set the Guiness world record for the biggest tulip bubble?

Massive data advantage in driverless, five years ahead in battery tech, world trending EV, factories in China (massive market) and Germany, upside potential of semi and pickup markets.  Way upstream Tonto and I were talking about the chick from Ark Investments who has a base case of 7 grand for 2024.  No doubt there is a huge amount of fanboism out there, but I think the bull case is legitimate.

[Tamas]

What am I missing on Tesla?  Is everyone just bored to death due to Covid, and is trying to set the Guiness world record for the biggest tulip bubble?

Massive data advantage in driverless, five years ahead in battery tech, world trending EV, factories in China (massive market) and Germany, upside potential of semi and pickup markets.  Way upstream Tonto and I were talking about the chick from Ark Investments who has a base case of 7 grand for 2024.  No doubt there is a huge amount of fanboism out there, but I think the bull case is legitimate.

Oh please that might explain a share price 10% of what it is now. Even people who pour their life savings into it do not pretend it makes any economic sense.

[Tamas]

Which reminds me, there was Bitcoin then Tesla. Do let me know if you spot what's the next tulip is going to be :p

[Admiral Yi]

We'd like to thank our global partners at Beet Holdings for their meticulous financial analysis. 

10% of current price is probably explained by current profits.  90% is speculation on future earnings.

[DGuller]

We'd like to thank our global partners at Beet Holdings for their meticulous financial analysis. 

10% of current price is probably explained by current profits.  90% is speculation on future earnings.

I'd say it's 10% explained by current profits, 10% explained by speculation on future earnings, 30% explained by speculation on speculation on future earnings, and 50% explained by speculation on speculation on speculation on future earnings.

[Admiral Yi]

Let me see your math.

[DGuller]

Let me see your math.

The math is a little complicated, but it's all in here:  .

[alfred russel]

We'd like to thank our global partners at Beet Holdings for their meticulous financial analysis. 

10% of current price is probably explained by current profits.  90% is speculation on future earnings.

I'd say it's 10% explained by current profits, 10% explained by speculation on future earnings, 30% explained by speculation on speculation on future earnings, and 50% explained by speculation on speculation on speculation on future earnings.

Looking up its financial statements, Tesla hasn't produced profits in the last 3 years (the only years I've checked). Last year it lost $862 million for its shareholders. In the first 6 months of this year, it has turned a profit of $120 million. I didn't check the current market cap based on today's stock price, but as a few days ago, it was $350 billion.

I think 10% explained by current profits may be a bit generous (which would be $35 billion). Hell, claiming it is profitable because it peaked its head above water for a part of a year seems rather generous.

[Admiral Yi]

You're right.  Doubling that 120 million and using a PE of 25 I get 1.7% of current market cap.

[Tonitrus]

Still climbing in after hours. 

I think I'll drop a couple of shares if it hits $950.

Or not.  Shit.  I feel like I'm sitting on the bitcoin bubble.

And here we are 6 months later. 

Noticed that the stock value is now just about 10x it's 52-week low.

This feels a bit like that Jefferson quote about holding a wolf by the ears.

[Josquius]

So... This tech bubble.... Massive sign of a screwed up economy right? I all that money being traded back and forth between people over shares of a few firms rather than being invested into value making business....

[Admiral Yi]

So... This tech bubble.... Massive sign of a screwed up economy right? I all that money being traded back and forth between people over shares of a few firms rather than being invested into value making business....

Kind of, but probably not in the way you are thinking.

The ridiculously low yields on bank savings and bonds has definitely pushed people into equities.  On the other hand, the ridiculously low yields on bank lending and bonds means anyone who wants to borrow to finance the purchase of plant and equipment can do so very easily.

[Admiral Yi]

What are the biggest dogs in y'all's portfolios?  Here are mine.

AMLP.  Alerian Master Limited Partnership, oil pipeline index fund.  Down 53.44%.

EWP.  Spain index fund.  Down 30.37%.  First I got fucked by Catalan independence, then by Covid.

AGNC.  FHA bond REIT.  Mimsy turned me onto this because of the too good to be true 15% dividend yield.  Down 52.57%.

PSO.  Pearson ADR.  I bought at 15% discount to market at various times through a payroll deduction program so can't calculate percentage loss.  Bought at like 12, 14, 16, trading now at $7.49.

[Josquius]

So... This tech bubble.... Massive sign of a screwed up economy right? I all that money being traded back and forth between people over shares of a few firms rather than being invested into value making business....

Kind of, but probably not in the way you are thinking.

The ridiculously low yields on bank savings and bonds has definitely pushed people into equities.  On the other hand, the ridiculously low yields on bank lending and bonds means anyone who wants to borrow to finance the purchase of plant and equipment can do so very easily.

Yeah, the point is though they aren't. This kind of productive investment, the sign of a healthy economy, isn't happening. Instead it's all going into the bubble.