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chef
20 November 2010, 1725
Which stock do you think has more long-term potential: GM (newly re-IPO'd) or TSLA?

Tesla IPO'd at around 17, broke 30 the first week or so, tanked to about 15, and has steadily gained since then. It broke 30 again upon news that its 3rd quarter losses were less than expected (dontcha love that Wall St logic), and Friday closed a hair under 31. There are alot of people betting against them though. TSLA is currently the most shorted stock.

GM planned to IPO $26-29, adjusted to $31, 33, and finally $35. It has since been flat, closing around $34 on Friday. Large established company, theoretically more stable but with alot of baggage.

How I (as a layman) see it:
Tesla has more upside, much more growth potential, but as with all startups carries higher risk. GM is established and its stock valuation should be fairly stable, but doesn't seem to have nearly as much growth potential. This could all change very quickly of course. If GM commits to EVs and continues improving them, there's alot of growth opportunity for them. Otherwise if they back off on the Volt's successors, they'll be mired in the ultra-competitive market of ICE vehicles. Tesla has to be able to ramp up volume and bring prices down to increase market share. Easier said than done. Their partnership with Toyota's NUMMI factory is a step in the right direction. Farther out, the Chinese manufacturers are likely to storm into the market with EVs powered by their cheaper batteries. People will likely ridicule their quality, but just as the Japanese and Korean makes, they'll improve quality and establish within 10 yrs of entry. That would probably require a serious re-evaluation of the stocks.

If you had $x to invest, which would you choose? One, both or neither?

Nuts & Volts
20 November 2010, 1744
I would go 1/3 with Tesla because I want them to do well, but it is smart to put 2/3 in GM because they actually have a lot of technology coming new with hybrids, EVs (plug ins), and fuel cell vehicles that could boost their value.

Kyle

chef
20 November 2010, 1921
What concerns me with GM is whether their execs will lose patience with developing the EV sector. If they pull the plug on the program (like the EV1), their patent portfolio could be a hindrance to other companies trying to play in that space. Depends on how nasty GM decides to be. Alot of "ifs" floating about admittedly. Guess that's why they call it gambling.. er... the stock market.

BaldBruce
20 November 2010, 1927
I'd consider both of these companies as high risk stocks. Invest elsewhere if you want less risk and more stability. I see rocky roads ahead for both of them. Tesla because investors will get weary of the negative numbers and might lose patience. It's gonna be close that their funds will hold up long enogh to start turning a profit. Lot's of good signs, but still gonna be scary till they get going. GM is risky based on their recent history of leadership. Now that the gov is handing back the reigns, which way are they going to direct their energy? I pray for the best, but fear for the worst. Are they going to be left with a whole slew of plants and inventory when the price of gas eventually rises?? (Because they went after the big profits again on the monster vehicles again. and again. and again....)

I invested a bit in TSLA just to support them. I do not invest in GM. Go to Chipolte many times a month and drive my largest holding up!

Nuts & Volts
20 November 2010, 1959
What concerns me with GM is whether their execs will lose patience with developing the EV sector. If they pull the plug on the program (like the EV1), their patent portfolio could be a hindrance to other companies trying to play in that space. Depends on how nasty GM decides to be. Alot of "ifs" floating about admittedly. Guess that's why they call it gambling.. er... the stock market.

Well I am not sure about pure EV's but GM will continue to electrify/hybridize vehicles, a lot of them. This bodes well for the future (at least in my idea of the future). Now I think they will still build those monster vehicles in the future (for some stupid reason), but they are committed to meeting every CAFE standard set for them. GM wants to be the "first" to do something again, whether they will, we can only wait and see.

Kyle

electrician
21 November 2010, 0758
Invest in GM because the government won't let them fail, even if they say that they won't do it again. So your stocks are more secure than Telsa, who the government doesn't care if they fail or not. I just wish Tesla's sport car wasn't so darn expensive, then I'd by one today.

Richard230
21 November 2010, 0817
I wish I was too big to fail.......:rolleyes:

chef
21 November 2010, 0903
maybe you should be thankful you're not that big ;)

jazclrint
21 November 2010, 1610
As far as Tesla is concerned, don't forget the Model S is coming really soon, with a $50,000 price tag (or there abouts). That is part of their strategy, top down production. However, I think the Roadster did for the whole industry what Tesla was hoping it would do for just them. I think the model S will be the right car for the times, but this brings me to a company you folks have forgot, Ford. I have no idea how their stocks are, but they are doing better the GM, and next year they will release an all electric Focus, years before (it seems to me) Tesla will release an economy car. Ford has hybrids, and now had almost a decade of experience with them. Granted, they aren't the right kind like the Volt is, but it's all there. I'm still waiting for the Plug-in Escape.

Just my 2 cents,
Rich

billmi
21 November 2010, 1623
Not to mention what the partnership with Toyota will bring. Toyota has unveiled the demonstrator for the redesigned Rav4 EV, with a Tesla supplied battery system.

BaldBruce
21 November 2010, 1857
Invest in GM because the government won't let them fail, even if they say that they won't do it again. So your stocks are more secure than Telsa, who the government doesn't care if they fail or not. I just wish Tesla's sport car wasn't so darn expensive, then I'd by one today.

But what you are forgetting is that even though the government didn't let GM fail, all investors took it in the shorts! The stock value went to zero when they filed for bankruptcy. Not such a good investment unless you were the government who will get at lest 3/4 their money back.

chef
21 November 2010, 2138
As far as Tesla is concerned, don't forget the Model S is coming really soon, with a $50,000 price tag (or there abouts). That is part of their strategy, top down production. However, I think the Roadster did for the whole industry what Tesla was hoping it would do for just them. I think the model S will be the right car for the times, but this brings me to a company you folks have forgot, Ford. I have no idea how their stocks are, but they are doing better the GM, and next year they will release an all electric Focus, years before (it seems to me) Tesla will release an economy car. Ford has hybrids, and now had almost a decade of experience with them. Granted, they aren't the right kind like the Volt is, but it's all there. I'm still waiting for the Plug-in Escape.The Model S is a step in the right direction. At that price they should be able to sell alot more, especially considering it's a more practical car than the Tesla roadster. Still, $50k is high for the average buyer and they'll have to bring the price down a good bit more to become mainstream. But as a luxury class vehicle they may be able to carve out a niche if they play their cards right. I say 'luxury class' instead of 'EV enthusiasts' because I don't think they'd be able to make alot of money off us cheapskates ;)

Ford is definitely a contender worth considering. Not an IPO, though I guess you could argue GM isn't really an IPO in the traditional sense.

Richard230
28 December 2010, 1437
My newspaper today has a front-page article about Tesla with the catchy title of: "Low battery alert: investors bail on Tesla". It is a long article written by Troy Wolverton of mercurynews.com. The article says that Tesla's stock value dropped 22% yesterday. It appears that stockholders are getting tired of waiting for Tesla to produce the Model S while many other manufacturers are introducing their EVs for sale. The article says that although Tesla projects that the Model S will be on the market by 2012, some investors and stock analysts are not so sure. Plus the projected MSRP of $57,400 is deemed too high for any sort of volume sales in the current market. The article says that there is a big difference between making 1000 cars a year and making 100,000 cars a year, while also making money doing it (which has always been a problem for Tesla).

Another comment was that insiders owning the company stock were allowed to sell their shares yesterday upon the ending of a "lock-up" period for investors who owned the stock at the time of the IPO. When they started selling the stock, some other investors became nervous. Tesla's stock value has dropped from a high of over $35 to $25.55 a share as of yesterday.

Richard230
31 December 2010, 1601
It appears that Tesla has felt the need to beat their chest after taking it on the chin in the stock market this week, according to an article in my newspaper today written by Alan Ohnsman of Bloomberg News.

Their Chief Technology Officer, J.B. Straubel recently said in an interview that Tesla will be able to make money on the Model S once sales reach 20,000 a year. Whereas, Nissan CEO Carlos Ghosn has said that combined battery-car sales for both Nissan and its affiliate Renault may need to reach 500,000 units a year to become profitable - without government aid.

Straubel claims that this is because Nissan uses a large Li-ion battery which is very expensive to manufacture, compared with their use of thousands of small Li-ion laptop-type cells, which he says will remain more cost effective for the foreseeable future.

The article says that Tesla's battery packs may cost as little as $200 per kWh, compared to about $700 to $800 per kWh for large-form cell Li-ion packs, according to Martin Eberhard, a Tesla founder and former chief executive. Straubel declined to confirm Eberhard's cost estimate or discuss the cost of Tesla's battery packs.

David Reuter, a spokesman for Nissan, says that Nissan's EV strategy can't really be compared with that of Tesla's. He didn't elaborate. But he did say that the "Nissan Leaf product program will be profitable over its life cycle". However, he also declined to say how long this life cycle would be.

Happy New Year everyone. :)

chef
31 March 2011, 0935
Interesting turn of events...
http://www.streetinsider.com/Upgrades/Tesla+Motors+%28TSLA%29%3A+Americas+Fourth+Automak er%3F+-+Morgan+Stanley/6398471.html

Morgan Stanley is out with one of the boldest calls I have seen in a while - Adam Jonas is upgrading Tesla Motors (NASDAQ: TSLA) with a $70 price target, representing almost 200% upside.

His Bull Case? $135 share - 460% upside. According to the firm Tesla will eventually become the 4th major U.S. Auto manufacturer behind GM, Ford & Chrysler.

This begs the question -- How accurate is Morgan Stanley's assessment...

EVcycle
31 March 2011, 0953
Won't let me look at it since I am not a member. :(

BaldBruce
31 March 2011, 1043
And TESLA is now up 17% already today....... Helps my paltry little 25 shares but sure proves the herd mentality is at work......

DaveAK
31 March 2011, 1052
And TESLA is now up 17% already today....... Helps my paltry little 25 shares but sure proves the herd mentality is at work......
Yeah. My first reaction was Adam Jonas must have friends with Tesla stock.

chef
31 March 2011, 1332
Won't let me look at it since I am not a member. :(
Strange.. didn't ask me for membership. Here's a Google cache text-only version of the page
LINK (http://webcache.googleusercontent.com/search?q=cache:fRvaWwrjnbgJ:www.streetinsider.com/Upgrades/Tesla%2BMotors%2B%28TSLA%29%253A%2BAmericas%2BFour th%2BAutomaker%253F%2B-%2BMorgan%2BStanley/6398471.html+http://www.streetinsider.com/Upgrades/Tesla%2BMotors%2B%2528TSLA%2529%253A%2BAmericas%2B Fourth%2BAutomaker%253F%2B-%2BMorgan%2BStanley/6398471.html&hl=en&strip=1)

BaldBruce
31 March 2011, 1541
IF they make it, TESLA will grow very quickly in both sales and equity. Big IF. I think they will, but they face many struggles to get to 2013 and large volumes of the Model S. They are planning on selling 5000 cars in 2012, but that "only" gets them 250 million of sales. 2013 is planned for a cool billion in sales. That should get Detroit's attention.

Richard230
01 April 2011, 1523
The business section of my newspaper today reports that Tesla's stock got a nice 17% boost yesterday, thanks to Adam Jones, a Morgan Stanley analyst making favorable comments about the company yesterday (as discussed above). He said that the company's stock price could reach $70 some day and stated that EV sales could reach more than 15% of vehicles sold by 2020. Yesterday Tesla's stock "surged" $4.04 to $27.75, apparently in response to this report.

However, Mike Omotoso, the senior manager of the global powertrain section of J.D. Power & Associates, is not so enthusiastic about electric vehicles and believes that they will only make up 2% of sales by 2020.

chef
02 April 2011, 0518
There will always be doubters such as Mr Omotoso. "Those EVs will never work!", I can hear him saying. His salary/bonuses are probably high enough that he doesn't care how much it costs to fill his Escalade. And that would place him in the one-percenter category.

Richard230
06 May 2011, 1530
Poor Tesla. The better they do, the more money they loose. The LA Times reports that Tesla just announced revenue of $49 million over the first quarter of 2011, more than double the $20.8 million that they made a year ago. Over the past quarter they delivered record numbers of battery packs and chargers for the Daimler electric Smart Fortwo and the Toyota electric RAV4, which is due out next year. In spite of this income, Tesla still lost $48.9 million in the quarter, compared with loosing $29.5 million a year earlier. Tesla CEO Elon Musk, in a telephone call to Tiffany Hsu of the Times, said that he was optimistic about the company's prospects.

Last month Tesla opened a new store in San Jose's Santana Row retail center. It has hired more than 130 new employees - mostly in manufacturing, research and development. More than 1,650 Roadsters have been delivered internationally and the model is expected to sell out by the end of the year.

BaldBruce
06 May 2011, 1721
And yet the stock price is pretty flat. Up a bit today even. Investors have been vary wary of this stock (with good reason since they are on the bleeding edge) with a short ratio of 33%. One of the top 5 short ratios in the market. But inspite of all that downward pressure, the stock has been relatively flat for quite some time. What this can mean is that if TESLA continues to be successful, the stock will skyrocket when those betting on the short option have to sell to cover the calls. That is of course the 64,000 dollar question. "IF" TESLA can continue to be successful. I'm betting they make it and make my paltry little 25 shares worth something, but appear to be in the minority.....

chef
01 July 2011, 1016
Tesla's stock peeked above $30 this week so I went digging for some news. A few interesting morsels -

A number of execs have been selling off their stock for up to $30.20 over the past month (http://www.reuters.com/finance/stocks/insiderTrading?symbol=TSLA.O). Are they not confident the stock will rise further or do they just have so many shares that they're hedging their bets?

Tesla announced the Model X crossover will ship in 2013 (http://blog.caranddriver.com/tesla-model-x-crossover-on-sale-in-late-2013-model-s-moving-along-30k-vehicle-planned-for-20152016/) (pic in the link is of a Model S, oddly)

The Model S appears to be on track for 2012 production (http://www.autoweek.com/article/20110120/CARNEWS/110129996) (with video). I've read reports that it has anywhere from a 17" to 27" touchscreen display. 27 seems unlikely to fit.

Richard230
01 July 2011, 1447
Well, they certainly have managed to hid the sound of the electric motor on the Model S. It looks like a nice car. A bit out of my price range, though.

BaldBruce
01 July 2011, 2027
4 trades in June is not exactly eyebrow raising. Undrstand how options work?
Buy at the quaranteed price (2 bucks in a lot of these cases) and sell for 30 the same day. I'd be doinfg it to if I could.....