2012 Tesla Model S
  • 2012 Tesla Model S
  • 2012 Tesla Model S front 3/4 view

  • 2012 Tesla Model S
  • 2012 Tesla Model S rear 3/4 view

  • 2012 Tesla Model S
  • 2012 Tesla Model S front 3/4 view

  • 2012 Tesla Model S
  • 2012 Tesla Model S rear 3/4 view

  • 2012 Tesla Model S
  • 2012 Tesla Model S side view

  • 2012 Tesla Model S
  • 2012 Tesla Model S front view

  • 2012 Tesla Model S
  • 2012 Tesla Model S rear view

  • 2012 Tesla Model S
  • 2012 Tesla Model S front 3/4 view

  • 2012 Tesla Model S
  • 2012 Tesla Model S rear 3/4 view

  • 2012 Tesla Model S
  • 2012 Tesla Model S headlight

  • 2012 Tesla Model S
  • 2012 Tesla Model S logo

  • 2012 Tesla Model S
  • 2012 Tesla Model S wheel

  • 2012 Tesla Model S
  • 2012 Tesla Model S side marker

  • 2012 Tesla Model S
  • 2012 Tesla Model S door handle

  • 2012 Tesla Model S
  • 2012 Tesla Model S brake light

  • 2012 Tesla Model S
  • 2012 Tesla Model S taillight

  • 2012 Tesla Model S
  • 2012 Tesla Model S logo

  • 2012 Tesla Model S
  • 2012 Tesla Model S logo

  • 2012 Tesla Model S
  • 2012 Tesla Model S badge

  • 2012 Tesla Model S
  • 2012 Tesla Model S badge

  • 2012 Tesla Model S
  • 2012 Tesla Model S front cargo area

  • 2012 Tesla Model S
  • 2012 Tesla Model S rear cargo area

  • 2012 Tesla Model S
  • 2012 Tesla Model S interior

  • 2012 Tesla Model S
  • 2012 Tesla Model S interior

  • 2012 Tesla Model S
  • 2012 Tesla Model S interior

  • 2012 Tesla Model S
  • 2012 Tesla Model S steering wheel

  • 2012 Tesla Model S
  • 2012 Tesla Model S front seats

  • 2012 Tesla Model S
  • 2012 Tesla Model S front seats

  • 2012 Tesla Model S
  • 2012 Tesla Model S rear seats

  • 2012 Tesla Model S
  • 2012 Tesla Model S digital display

  • 2012 Tesla Model S
  • 2012 Tesla Model S digital display

  • 2012 Tesla Model S
  • 2012 Tesla Model S steering wheel

  • 2012 Tesla Model S
  • 2012 Tesla Model S steering wheel controls

  • 2012 Tesla Model S
  • 2012 Tesla Model S steering wheel controls

  • 2012 Tesla Model S
  • 2012 Tesla Model S dash

  • 2012 Tesla Model S
  • 2012 Tesla Model S emergency button

  • 2012 Tesla Model S
  • 2012 Tesla Model S center arm rest

  • 2012 Tesla Model S
  • 2012 Tesla Model S touch screen

  • 2012 Tesla Model S
  • 2012 Tesla Model S touch screen

  • 2012 Tesla Model S
  • 2012 Tesla Model S touch screen

  • 2012 Tesla Model S
  • 2012 Tesla Model S touch screen

  • 2012 Tesla Model S
  • 2012 Tesla Model S touch screen

  • 2012 Tesla Model S
  • 2012 Tesla Model S touch screen

  • 2012 Tesla Model S
  • 2012 Tesla Model S touch screen

  • 2012 Tesla Model S
  • 2012 Tesla Model S touch screen

  • 2012 Tesla Model S
  • 2012 Tesla Model S VIN display


Tesla Motors
is looking for history to repeat itself.

The luxury electric-vehicle maker, which raised $226 million in its June 2010 initial public offering, is looking to raise another $225 million in equity through an additional stock offering.

Last Friday, Tesla said it priced 6.93 million shares at $28.25 each and is offering another 30-day option to its underwriter for an additional 1.04 million shares. Tesla co-founder Elon Musk will also buy as many as 35,398 shares in the company, whose stock was trading at about $29 a share as of Monday morning.

Tesla, which also has received a $465 million credit line from the U.S. Department of Energy, recently said it's being asked to speed up repayment of that loan starting later this year.

Last week, the company cut its 2012 revenue forecast by about $160 million to as much as $440 million because of production delays for its Model S sedan. The company has not yet made a profit. Check out Tesla's press release on the stock offering below.
Show full PR text
TESLA MOTORS ANNOUNCES PRICING OF ITS FOLLOW-ON OFFERING

FRIDAY, SEPTEMBER 28, 2012

Tesla Motors, Inc. (NASDAQ: TSLA)announced today that it has priced and fully allocated its follow-on offering of 6,925,740 shares of common stock at a price to the public of $28.25 per share. In addition, Tesla has granted the underwriter a 30-day option to purchase up to an additional 1,038,861 shares of common stock. All shares are being offered by Tesla. The closing of the offering is expected to take place on or about October 3, 2012, subject to customary closing conditions.

Additionally, as part of the offering, Elon Musk, Tesla's Chief Executive Officer and cofounder, has indicated that he will purchase up to 35,398 shares of common stock at the public offering price for an aggregate purchase price of approximately $1 million.

Tesla intends to use the net proceeds from the offering for general corporate purposes.

Goldman, Sachs & Co. is acting as sole book-running manager for this offering.

An effective registration statement relating to the securities was filed with the Securities and Exchange Commission on September 25, 2012 and amended on September 28, 2012. The offering of these securities will be made only by means of a prospectus supplement and the accompanying prospectus. Copies of the final prospectus supplement and accompanying prospectus may be obtained from Goldman, Sachs & Co., via telephone: (866) 471-2526; facsimile: (212) 902-9316; email: prospectus-ny@ny.email.gs.com; or standard mail at Goldman, Sachs & Co., Attn: Prospectus Department, 200 West Street, New York, NY 10282-2198.

This press release shall not constitute an offer to sell or a solicitation of an offer to buy, nor shall there be any sale of these securities in any state or jurisdiction in which such an offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.

ABOUT TESLA

Tesla's goal is to accelerate the world's transition to electric mobility. Palo Alto, California-based Tesla designs and manufactures EVs and EV power train components for partners such as Toyota and Daimler. Tesla has delivered more than 2,350 Roadsters to customers worldwide. Model S, the first premium sedan to be built from the ground up as an electric vehicle, began deliveries in June 2012.


I'm reporting this comment as:

Reported comments and users are reviewed by Autoblog staff 24 hours a day, seven days a week to determine whether they violate Community Guideline. Accounts are penalized for Community Guidelines violations and serious or repeated violations can lead to account termination.


    • 1 Second Ago
  • 56 Comments
      Levine Levine
      • 8 Months Ago
      If Tesla is doubling the number outstanding shares, its share prices should be halved. About $14.50.
        oktrader
        • 8 Months Ago
        @Levine Levine
        Although I don't think the shares are worth the current ~$30, the market does. They are worth whatever the buyers and sellers determine.
        Nick Kordich
        • 8 Months Ago
        @Levine Levine
        They're not doubling the number of shares, they're offering another 7.5% - that's up to 7.97 million shares, including options, added to the 105.43 million shares currently out there.
      oktrader
      • 8 Months Ago
      Thanks, ltaw. This is a good link for all interested folks (long or short), and a good read for anyone interested in how the ATVM Loans are structured. It probably seems like I am an opponent to the ATVM program. I am actually just ambivalent about it. As gov spending goes, you could surely do worse. What I don't like is that the loans are targeted towards building cars rather than homing in on technology development. And, while I get grumpy about Chu's team managing the Tesla Loan poorly, you have to remember that Ford and Nissan received more than an order of magnitude greater total guarantees.
      Marcopolo
      • 8 Months Ago
      The very existence of Tesla Motors is a remarkable feat ! Production of the astonishingly refined model S, is unprecedented for 60 years in the automotive industry. In essence, the largest underwriter and financier of Tesla is the DOE. Tesla may have been a little over confidant and optimistic in some predictions, but given the size of the task, and the events within the US economy, Tesla has basically proved to be a well managed company, and has fulfilled most of it's expectations brilliantly. In a normal commercial context, Tesla should be able to seek further accommodation from the DOE. However, the DOE loans are not just normal commercial loans. These loan guarantees were funded by the US taxpayer so US corporations could raise capital to fund innovative new development to provide alternate energy technology, that will benefit the American people. Tesla has proved that it's a well managed performer in pioneering viable non-fossil fuel personal transport. In doing so, it has stayed true to it's remit from the DOE. In any many nations this would be grounds for the government to forgive, part or all, of the loan (guarantee) as a grant, or at least convert the loan to a bond. This would assist Tesla at a time when cash-flow is crucial and capitalization is difficult. The size of loan is relatively small, Tesla has proved it potential. However, in the US the political howl from the US ultra right, would make such government action unlikely. This is odd because Tesla is a US company and the ultra-right are supposed patriots ! To Oktraders horror, BipDBo, your passionate investment will help support Tesla, (Not as much as buying a Model S) but your investment could help to stabilize, or increase, Tesla's share value. Oktrader, is quite right to point out that Tesla shares are probably overvalued ! (How frustrating for the rational analyst to encounter shareholders whose investment motivation is based on an ethical desire to see the company succeed, than short-term speculator profit.!)
        purrpullberra
        • 8 Months Ago
        @Marcopolo
        I think your idea of forgiveness (I've never heard it before) could really work in this way; set it up with Solyndra and make the argument that for 2 start-up's worth of loans we gain one successful, world-class all-american company. The politics could work. Especially if dems use the "we can't convince the 47%" argument" against the nattering naysayers (GOP DC pols). Just do it and scream about the success. Mission Successful! For real though, again.
          Marcopolo
          • 8 Months Ago
          @purrpullberra
          @ purrpullberra The DOE could simply buy up Tesla's loan, and convert it to a long term Bond. The Bond could be repaid from a government grant for each year Tesla remains a successful US employer . The US government could fund such a scheme by imposing a special levee of 1 cent per gallon on gasoline. Such a levee, correctly managed, could provide a fund of more than $ 2 billion per year.
          purrpullberra
          • 8 Months Ago
          @purrpullberra
          I was only referring to how to 'sell it' to the public. Its a great idea.
        oktrader
        • 8 Months Ago
        @Marcopolo
        Marco, the remaining readers must be really interested in Tesla (why else stick around?) They should understand the history of the Loan Agreement and where it is today. The original agreement was inked on 20 Jan 2010. About a year later (15 Jan 2011) it was amended to expand cash investment options. It's arguable this was a reasonable alteration allowing more-or-less "normal" use of the disbursements. I'm less charitable, and I'm convinced that the Amendment was needed because Tesla's projections were far too optimistic. Musk's assertions of steady Roadster production and Model S shipments in 2011 bespeak a very success-oriented business plan submitted to the DoE in 2009 (it's confidential so everything we say about it is speculation). In late 2011, it was increasingly clear to practically everyone (including, apparently, raktmn's dog) that Tesla would not be able to meet debt service coverage ratios in the original agreement. This would technically place them in default. Dr. Chu's minions agreed to waive of those covenants on 22 Feb 2012; in return Tesla committed to funding the first three repayment installments in a "do not touch" reserve ("restricted cash" on their balance sheet). Tesla funded the 1st repayment installment in Feb, as agreed, with the understanding of another $30+ million "deposit" to the reserve in mid-Oct for the second and third repayment installments. More to come on this... On 20 Jun 2012, there was another amendment to allow additional freedom in the use of resources. This is where a lot of people (and you can paint them politically however you wish, with "fiscal prudence" translating to "Nazism" in the EV webzine handbook) started calling foul. It's apparent they were on the ragged edge, or perhaps crossing over, in the application of ATVM cash well outside the intent of technology development. Meanwhile, back in the Tesla Hall of Accounting, it seems that there was insufficient planning, intent, funds... whatever to meet the Oct repayment reserve agreement. The latest modification > removed the obligation to comply with financial covenant for Q3: > postpone repayment reserves until 15 Feb 2013, with the first $14.6M originally due in October: > make additional pre-funding payments, beginning June 2013, of "between $14.2 million to $14.5 million each quarter to pre-fund the quarterly principal and interest payments due from September 15, 2013 through December 15, 2014"; and > required Tesla to "work in good faith with the DOE" to develop an early repayment plan before end of Oct. "Early" could mean 10 days earlier -- just keep it out of the newspapers! To your point: "In a normal commercial context, Tesla should be able to seek further accommodation from the DOE" : absolutely not. Furthermore, in the context of taxpayer interest, Tesla and DoE have nudged the agreement far adrift from its original structure and intent.
          Marcopolo
          • 8 Months Ago
          @oktrader
          @ oktrader Thank you for your reply, which I always enjoy reading. However, I think you miss the point. The DOE, is in the business of promoting the development of alternate fuel technology. The DOE, is not a commercial bank who's primary interest is to make money, and safeguard against losses. If a Commercial Bank recovered it's investment with a profitable interest return, but Tesla failed, the bank would consider it's investment a success. But for the DOE, such an event would be a failure. The DOE 's 'profit', is derived from the creation of Tesla and the successful development of Tesla's technology. If Tesla was successful, advancing EV technology, while becoming a major US employer, but never repaid the loan, then the DOE, would have satisfied it's primary objective. That's the difference !
      purrpullberra
      • 8 Months Ago
      All 'normal' assessment of Tesla and it's financials completely neglect the single most important part of the company's existence. The company was founded to change the world by someone who wants to do it and has, maybe, what it takes. I'm not making a case for him as much as pointing out that the 'rationale' has never been there and STILL they are nearly to ramped up production (approx 5 weeks behind previous goal, not bad I think). And how much income is there when the orders are delivered, just current ones? 1.1 billion? All these people are 'dreamers' and can't be accounted for in any rational way. It is one of the key reasons, BTW, why I find publicly betting against them so distasteful. It ignores the company's founding mission and dismisses as losers its very forgiving first customers and bets against its financial backers for some more profit$$$$$$.
        oktrader
        • 8 Months Ago
        @purrpullberra
        OK, purrpull, hang on for the ride: "All 'normal' assessment of Tesla and its financials completely neglect the single most important part of the company's existence." Yes, that's true. If you want a loan guarantee from taxpayers and to issue stock in the open market to raise money, your Greater Goals do not absolve you from meeting financial commitments. Period. Blackrock, Fidelity, Vanguard and all the other MAJORITY institutional holders have not sent a letter to their investors telling them they are putting money in something they hope will change the world but "might burn a few $100M, no worries". They are betting on the possibility that Musk is right about making gobs of $$. (Mind you, some of these funds were big holders of RIM and ZYNG; they're not perfect.) BTW: the MOST ruthless activist investors? Public employee pension fund managers. Gentle, soft-spoken, hopeful, skyward-looking teachers are backed by hard-nosed toughs who pound boardroom tables and poke CEOs in the chest demanding improved ROC in order to protect their clients. Their unclouded view: All God's chillun needs they money, folks, and if I put it in someone's business I expect them to return what they said they would, even if they are the living embodiment of deities. "And how much income is there when the orders are delivered, just current ones? 1.1 billion?" No, actually; that's gross revenue. Income is determined once you subtract Cost of Goods Sold, Expenses (R&D, SG&A, etc.), Depreciation/Amortization, and Taxes. Best case for that net income is perhaps $50M; probably less. "All these people are 'dreamers' and can't be accounted for in any rational way." Yes, they can, with reasonable market analysis. "It is one of the key reasons, BTW, why I find publicly betting against them so distasteful." If business leaders are at risk of missing financial obligations, and the value of that enterprise is suspect, anyone with the means can offer a contract to holders of that investment for a sum of money in exchange for downside income opportunity. It's just business. "It ignores the company's founding mission and dismisses as losers its very forgiving first customers..." Not at all: they account for about $110k per car for the first 1200 or so units at a negative Gross Margin. "...and bets against its financial backers for some more profit$$$$$$" Hardly. The real financial backers, such as the most recent underwriter Goldman Sachs, will make a ton of money lending shares for short selling at a premium. They have reserved the right to float an additional 600k shares or so that will probably be used mostly for that purpose. The backers will make money either way. Welcome to commerce. It's a jungle out there. Be careful with yer $$ (and I mean that with no malice: plenty of people with no regard for you will tell you whatever they think you want to hear to take your hard-earned wealth. You need to fight to keep it and make it grow. Truly, honestly, I wish you luck.)
          purrpullberra
          • 8 Months Ago
          @oktrader
          I'm not denying anything you've said, you know what you know and can cite important facts and figures. I think we are quite acquainted with each others arguments except I don't think you understand what I meant today: I mean in addition to all of your analysis there is an undeniable faction of 'dreamers' that can't be accounted for because they do not respond to anything from spreadsheets or SEC filings. Its the 'reason' no one agrees as to how 'overvalued' Tesla is at any moment. I think there are more easily quantifiable ways to make profit in the manner you are doing. Its getting into bed with loose people isn't it? A way to have fun, sure, profit, maybe but why not short Microsoft instead? Any other stock seems more likely to behave with some normalcy that could lead to a more predictable outcome. BTW, it is a popular but incorrect belief that these old pensioners are unwilling to forgo a .7% less return in order to help not ruin the world. The boards hire the leaders, fund managers and the rest and each group is only ever drawn from the 'class' of people who believe that garbage with their hearts(?). I've seen as much evidence that those old retired teachers are haunted by these unmitigated greed on their supposed behalf. They never ask these retired people, only assume they are as greedy as the greediest people alive. They aren't, they can't be! Don't tell me how they vote, they have no real choices to make a less greedy option. I can't say I wish you luck with this part of your venture but besides strongly held convictions I don't wish you any other financial or other harm. You are being very kind.
      BipDBo
      • 8 Months Ago
      On one hand, it's a company that currently has a monopoly a revolutionary product, and there production expenses will likely lessen as betteries get cheaper. On the other hand, it's a niche and that monopoly could be lost whenever the bigger players get intested and they will be running a fine line of low available capital as they ramp up. It's a high drama investment, very interesting to watch. They could very easily fail, but if they can get through, they may just emerge as a serious fourth domestic automaker. I don't have much available investment funds, but I'm seriously considering pouring a chunk into Tesla. Sure it's a gamble, but I'm young. If I loose a bunch of money, at least I'd know that I was part of a revolution that's bigger and more important than the typical stock purchase.
        brotherkenny4
        • 8 Months Ago
        @BipDBo
        Typically Bip (being young and all) you would still diversify. High risk is not bad at your age (whatever that may be) but only as a percent of your available investment funds and typically smaller amounts placed over numerous higher risk investments, not just one. This means you only need a certain small percentage of the high risk stock to hit in order to recover any losses elsewhere. Nonetheless, at 29 bucks a share, they are not priced too bad, and would make a reasonable risk. I think they may end up with the EV followers as loyal customers into the future. They also claim they will turn a profit as soon as they hit 7000 vehicles sold (model S). That shouldn't be too difficult. Where they are struggleing is with production speed. And, they are dependent on single suppliers who may be capable of being bought off by the competitors to Tesla. I don't think any of the majors will actually really try to sell something similar until they are forced to. In fact, I think many of the typical auto manufacturers would rather fail entirely than be forced to produce an economical EV. In reality, that is the only reason one doesn't exist already.
          Grendal
          • 8 Months Ago
          @brotherkenny4
          Totally agree. The Big Boys really have no reason to get into conflict with, what they view as, a small time company building a niche car. They're watching Tesla to see what happens and, if they are successful, jump in and try to get the market share back. It's a high risk proposition that Tesla is attempting to do and why should any of the Big Boys bother? Nissan made a big push for the low end market and look what that is getting them: a lot of problems and bad PR. It just proves to the Big Boys to let the other guy take all the risks. All of which is spectacular for Tesla as long as they get the production where they need it to be.
          JakeY
          • 8 Months Ago
          @brotherkenny4
          I think their biggest worry is not the big boys (which have little to no interest in EVs other than to satisfy ZEV requirements in California). They have to worry about other luxury makes that might try to push into Tesla's monopoly on the premium EV market. Biggest one is Nissan/Infiniti as they already have the production capacity to outdo Tesla (although their recent PR blunder makes them less competitive). BMW is the other huge one as they seem very serious about their i-Series. Daimler is less worrisome since they are working with Tesla. Audi seems to be only testing the water.
          purrpullberra
          • 8 Months Ago
          @brotherkenny4
          As to Tesla having rivals, tell me how your Infinity or i3 are going to do grand touring? Do not underestimate this soon-to-be ability for the foresighted who can afford it. Considering the fact that each and every review and owner report is glowing and the car is out achieving its promise. They'll make a 50k version and have the high performance variety too. How does anything anyone else is doing compare to the promise of free fueling for grand touring in the very near future? Even if this doesn't appeal to you it does to many others, who want to avoid flying for example, and those people have the exact kind of $ Tesla is asking as evidenced by $5,000 deposits of over 13,000 customers.
          JakeY
          • 8 Months Ago
          @brotherkenny4
          @Rotation They at least have products planned for launch soon which will compete directly with Tesla's segment: Infiniti LE BMW i-Series Mercedes B-Class E-Cell I think the existence of competitors will obviously affect Tesla sales. There's also the SLS E-Cell and R8 E-tron in the performance segment (assuming Tesla is on schedule for a Roadster successor). As for your comment on the premium EV market, it's hard to say how big it will be in the future. There's a bit more than a million sales per year in the premium car market in the US. If the Model S sells more than 10k per year in the US (they already have 13k reservations worldwide), they already have ~1% of the market. If I'm understanding correctly you are saying the premium EV market will shrink within the next couple of years (when I cars I mentioned will be on the market). I say that's a bit pessimistic, esp. if you look at hybrids as a model (which have grown slowly but surely in share).
          Rotation
          • 8 Months Ago
          @brotherkenny4
          JakeY: I don't think there is much risk of the big guys moving into the premium EV market. By the time any would have entered, the market demand will be satiated and sales slowing for Tesla. There just isn't a big enough pie to split right now.
          oktrader
          • 8 Months Ago
          @brotherkenny4
          Wow. brotherkenny, you should stick to spiritual and not financial interpretation. "They also claim they will turn a profit as soon as they hit 7000 vehicles sold (model S). That shouldn't be too difficult." Tesla is currently making an across-the-board automotive GM of (15-18%); that's for EVERYTHING, including EV credits, which are pure margin. This means the S Model is probably turning in the (20-30%) range. Ouch. There is a LONG way to go just to get to breakeven at the bottom line, especially when you consider the ~$3K Signature premium disappears at roughly 1200 units. Plus Musk was kind of cagey about what the 8000 unit "breakeven" really means. A little arithmetic shows you that he meant Gross Profit breakeven. Expenses, Depreciation, Amortization, and Taxes are little tidbits that also need to be considered. Even the most hyperoptimistic analysts don't project much better than a 0.50/share EPS in a 20,000+ unit year. 7000 units can't possibly equal profitability. "Where they are struggling is with production speed." Which means they are struggling with profitability and liquidity. "And, they are dependent on single suppliers who may be capable of being bought off by the competitors to Tesla." But, don't you remember when Musk expressed the readinness for production back in January: "...the company is determined to have the ability to manufacture most or all of those parts in-house 'in a pinch,' as Musk put it." Well, there's a hell of a "pinch" right now, so why aren't Tesla just insourcing whatever they need to? Fremont is showing some weak supply chain management skills, and blaming suppliers in any case but environmental catastrophe proves it. As for major makers buying out capacity to prevent Tesla production: this would be a clear case of restraint of trade by any ,measure. If Tesla's legal team was worth its SG&A expense, they could easily address it. Cheers to the management team for handling the financing round so adroitly. Basically, they have issued stock to pay bills, and it's working out for them.
          JakeY
          • 8 Months Ago
          @brotherkenny4
          @purrpullberra The cars I mentioned will be mainly competing with the 40kWh Model S (and the planned gen 3 car) and they likely will have quick charging. I'm not saying they will necessarily have a huge effect on Model S sales, but I think they will at least have SOME effect vs. the current situation.
        oktrader
        • 8 Months Ago
        @BipDBo
        Bip, gambling is just that: gambling. If that's how you would truly perceive the purchase of TSLA shares, you should really reconsider. Although I am a Tesla sketpic, I would say this about ANY impulsive stock purchase, even in the complanies I find to be low risk. It's just not something you should do. However, if you take the time to understand the company and its valuation, and you STILL have a conviction that value will increase, I would strongly suggest you find someone who can help you use options to protect your investment. It is a stock whose value has dithered between $26 and $36 in just the last 90 days. Furthermore, if you want to "be part of a revolution" by buying TSLA, you have missed the boat if you think you would be "helping" the company. The shares will already have been issued to brokers and you will be buying from the open market. The raise to Tesla will already have happened by the time you own the shares. If you are really, truly interested in being an investor in the sector, you could check the "kickstarter" markets for early investors. Buying shares just makes you a speculator in the value of a share, no different than goons like me.
          raktmn
          • 8 Months Ago
          @oktrader
          If Elon Musk waits to exercise his stock options until the stock goes up, they will be worth much more without him having to tie up any of his own cash to hold the stocks. It is the ultimate way to leverage your investment dollars, because you gain stock value without actually putting any of your own money on the line. You then take the cash you would have used to buy out the stock options, and invest it somewhere else and make money there at the same time your options increase in value. He can make much more money by waiting to exercise his options. The way you talk, you make a smart investment decision sound like Conspiracy Theory staring Jesse Ventura. I don't get it?
          purrpullberra
          • 8 Months Ago
          @oktrader
          I think that just as apple shares are purchased in large numbers by apple fanboys Tesla shares are something one wants to own as another tie to a company, uh, touching their lives. Not a large percentage probably but not insignificant. There are many larger investors who will stick with it to nearly the bitter end because of who they invest for and to offset some of the, say, oil stocks. Not a lot but it's not insignificant. Add it up and possibly half the market value is just dreams and wishes. Now they have the orders and some 4-6 months more financing to get to production up and soon... the dreams and wishes start coming true. And these rich people have rich friends who can fit in for test rides. Man, have you read the latest reviews on Tesla forums from folks who have their cars? Every car delivered will cause 2or 3 orders. Each glowing review sells 100 Tesla wouldn't get otherwise. When 10,000 are on the road things roll on.... Success breeds itself once you get there. Will they ever become bigger than a high-end niche? I honestly don't understand betting much at all against dreamers essentially. I imagine you aren't That exposed.... But do you continue to short or feel as certain as when you started this tactic? They obviously can't get any closer to the point where the models is a success. Sure the numbers can be seen as a strangling factor but they'll get lost in the celebration.
          oktrader
          • 8 Months Ago
          @oktrader
          Ryan: The stock has already placed with a variety of buyers. Some large funds (e.g, several Fidelity funds) are holders. GS, as the underwriter, also has reserved the right to issue another 600,000-odd shares, and has included this note for the interested student: "In connection with the offering, the underwriter may purchase and sell shares of common stock in the open market. These transactions may include short sales, stabilizing transactions and purchases to cover positions created by short sales. Short sales involve the sale by the underwriter of a greater number of shares than it is required to purchase in the offering..." among other things. I include this for those pecksniffian posters who call short positions "unAmerican" or somehow indicative of being (dare I repeat it?) a "bad person". Please understand that THE COMPANY THAT IS FINANCING THE ISSUANCE WILL BE INVOLVED IN SHORT SALES. Sorry to highjack your question for that... Also, Musk is PERSONALLY in hock to GS for about $85M from the previous secondary offering. (Please also note that Musk's "gracious" purchase of up to one whole million bucks of stock looks odd since he has the option remaining from 2009 to purchase about 6 million shares for $6.63 each. He would be putting over $40M of capital into the company AND getting millions of shares at >75% discount. Wonder why he doesn't...)
          oktrader
          • 8 Months Ago
          @oktrader
          rak: OR, he could purchase the shares right now, keep them as they appreciate, use them as collateral for breathtakingly cheap loans, and if he holds for >1 year before selling he would not be subject to income rate but capital gains rate instead. Nothing keeps him from buying these shares today, and if TSLA is really on its way to the stars, then it's a great investment, true? In the last secondary offering when Musk bought shares with "his own money", the actual definition of "his" money was a loan from Goldman Sachs. Now Musk says that shorts are about "to feel a tsunami of hurt", thus telling the market that share value is going to skyrocket BUT he buys zero at a huge discount in what would clearly be a fantastic opportunity for himself, a Charitable Trust, or his other businesses. That's not evil. He doesn't owe shareholders or the company a dime of his own money, I agree. There's no "conspiracy" there. But time after time (on this site especially), there is consistent talk of how Musk will PERSONALLY GUARANTEE deposit liabilities, or even the DoE Loan repayment. If he won't plunk down $44M against a guaranteed $150-200M (or more) upside, why do you think he's ready or able to back the company in the case of a downfall? My point is TSLA is just another stock to trade. It has no greater or lesser "ethical" value, to quote one of Marco's less rational thoughts, than anything else you will buy/sell/rent. When it comes to his personal involvement at a significant level of valuation, Musk is just another CEO.
          Ford Future
          • 8 Months Ago
          @oktrader
          It's a better Jag, then a Jag. It's not much of a risk.
          purrpullberra
          • 8 Months Ago
          @oktrader
          Ford Future, I gave accidental -1
          Ryan
          • 8 Months Ago
          @oktrader
          What if nobody buys this next round of stock? I doubt the big banks would want to hold on to it. But I don't know all the specifics of venture capital and investment funds.
          raktmn
          • 8 Months Ago
          @oktrader
          "My point is TSLA is just another stock to trade. It has no greater or lesser "ethical" value" You do not understand that there is a sizable pool of Tesla investors who invest for ethical reasons. Everyone is not you. Many people put their money where their ethical beliefs are. Tesla is a very small stock, making investing in Tesla a very small pond. A relatively small amount of ethical investment dollars can be a real big fish in a small pond. You should stop doing stock analysis on Tesla if you are making that huge failure in understanding what motivates many buyers of Tesla shares.
        Grendal
        • 8 Months Ago
        @BipDBo
        I'm waiting for another drop to the $27's for another buy in.
      Levine Levine
      • 8 Months Ago
      If Tesla is doubling the number of outstanding shares, its share prices should be halved. About $14.50.
      Grendal
      • 8 Months Ago
      Interestingly Tesla had already announced that it would seek to repay the loan early. So ultimately paying the DOE loan back early is just legalizing (with no penalty) using the remainder of their loan earlier than originally agreed upon. Tesla just needs to get over the hump and get to full production ASAP. A little extra cash gives them the cushion to accomplish this. Overall it doesn't put the company in a better position for the long haul but it does help them reach full production in the short term and beyond. So, in conclusion, this has to be an long term win for Tesla by helping them reach long term.
        oktrader
        • 8 Months Ago
        @Grendal
        Grendal, it looks like I'm stalking your posts here; I'm not. You are reasonable and not insulting. I can't agree with your view of the loan repayment. The loan underwriter (Department of Energy) has made three amendments to the company to mitigate the stress of previously agreed covenants. Viewed collectively the modifications are substantial, and it's not hard to see that Tesla would be nowhere close, during the critical periods of this venture, to meeting the requirements for disbursements. The DoE has been generous. Now they are asking for earlier repayment because it's not clear Tesla are a good credit risk. Read the 8k closely and it's clear that they are working out terms of early repayment in exchange for the latest "forgiveness". Prior to that disclosure there was NO announcement by Tesla that they would repay the loan early.
          oktrader
          • 8 Months Ago
          @oktrader
          Giza: I grudgingly give credit to the Tesla leadership team for issuing stock to pay bills and getting away with it. Remember the $200M-odd raise that was ostensibly to fund the Model X? All gone, and nobody even mentions it, with Model X reservations running under 200/month, and Tesla utterly silent about progress on the vehicle whose production has also slipped. Gotta admire their ability to raise dough. The stock is being purchased. Quite a bit will be lent for short selling (gasp!! how EVIL), which helps the firms holding TSLA shares to mitigate risk. Look for short interest to exceed 32M shares (IMO) by mid-Oct. Trust me: the Long firms out there touting TSLA are making some good $$ from short lending. It's important to remember that "sell side" analysts often has quite a bit going on besides simply evaluating a company and making a recommendation. Sometimes they want to attract underwriting opportunities by building relationships gained through their support of an issue. Sometimes they are big holders themselves, and are frankly pumping. No, I'm not saying this is a remnant of the pre-.com Bubble Henry Blodgett days -- after all, they do have to disclose positions, and there is a great deal more transparency. And you also have situations where the conviction is just so strong, and the analyst so committed that he cannot back down until it just too late. I think Theo O'Neill of Wunderlich learned this after hanging in there with a "Hold" position on HEV right up until they filed for C11; he has become much more cautious with TSLA. The trading culture is one in which admission of error is rare and generally is regarded as a sign of weakness. With TSLA, whenever the bad news breaks, you see this in textbook form. A key group of analysts had been briefed earlier in the year to expect 1000 deliveries in Q3 as an integral part of the $550-600M FY2012 guidance. Then at the Q2 CC call, Musk/Ahuja announced 500, as well as a steady quarterly stream of revenue from Daimler. Now less than three months later they confirm around 250 deliveries, Daimler revenue delayed until at least Q4, and FY guidance of ~$400M. The analysts view: "Oh, yeah, it's exactly as we expected." The high-profile firms' estimates for Q3/Q4 and 2013 have continued to slip and slip, and yet many run-of-the-mill industry slobs like me have nailed it time after time. You may look back and recall I posted Q3 sales in the low $50M, and this was allowing 300 revenue Model S deliveries, a charitable EV credit surge and crazily high Roadster sales. Now the 8K confirms mid-$40M. (BTW: Q3 losses will exceed $125 -- you heard it here first, sadly, and not from overpaid analysts who had been "estimating" $50-80M for the past 90 days.) Just remember that over 95% of all the stocks that comprise the S&P are weighted more than 50% Buy/Hold. Do your own DD and you'll be happier; otherwise find a fund with solid management that you trust and let them do the work.
          Rotation
          • 8 Months Ago
          @oktrader
          Giza: I think that Musk was being a bit careful with his words. Any early repayment would certainly refer to repayment in full (balance of principal), not start of repayment (installments). Personally, I think Tesla will make it through this cash crunch, so if you're a long-term holder the stock price rebound is probably justified. It does lead to some dilution, but most shareholders are oblivious to dilution, at their own peril. I think the current principals not selling their shares in this offering is also a good sign for the long-term prognosis. I think Musk buying more amounts to little more than a stunt, but it's not a bad thing either.
          raktmn
          • 8 Months Ago
          @oktrader
          Don't be insulting my dog. She's bad-ass. At least my dog understands that the reports are not predictions of the future that Tesla will deliver on time. My dog knows they are just what the value will be if Tesla delivers on time. The folks writing these valuations know that EV's all get delivered late. Your mistake is attempting to read too much into what has been written. They are not predicting that Tesla will deliver, they are stating what the value will be if they deliver X number of units by Y date. You seem very confused, and like to type a lot to hide it.
          oktrader
          • 8 Months Ago
          @oktrader
          rak, I get it now. You don't understand that when an analyst says "I estimate that Tesla will generate $500M of revenue in FY12 with an EPS of (2.75)/share", predicting the future is exactly what he is doing and why he is paid. His predictions of the future are the core value of analysis products sold to clients. When you watch the estimates of FUTURE REVENUE AND EARNINGS (which, oddly to you, does not sound like a "prediction") drop time after time down to the level that industrial experts have been projecting for a year, it tells you their PREDICTIONS of business performance were wrong. You seem to think it is no big deal that revenue and earnings estimates from brokerage firms are consistently wrong to the upside, and as news comes out that should have been understood by these firms, the corrections keep creeping downward. I would be fired for that. I do this for a living and I get it right. Oddly, they do it for a living but do not. This makes me question their motivation. I would be particularly concerned if I were paying for the analysis, which PREDICTS the company's financial health. You do know that the valuatiuon of a stock is fundamentally an agreement by the buyer and seller of its net present value of future earnings? Well, maybe your dog does. Seriously, man, stick to comments on why people should invest in nice things that you like and lay off the topic of analysis, about which you know nothing.
          Grendal
          • 8 Months Ago
          @oktrader
          Rotation: Agreed. Buying $1 million in an offering of $250 million, 1/250th, is more PR than significant purchase.
          oktrader
          • 8 Months Ago
          @oktrader
          Grendal, my error perhaps for misreading -- anyway I think we're all straight. As for your buy order at $27: if it drops to that level at a date >10-15 days from option expiratiion, you might consider looking into buying calls if they take a dip rather than actually purchasing more shares. I have personally (my own trading) done this with TSLA several times successfully.
          oktrader
          • 8 Months Ago
          @oktrader
          rak, I am by no means the only person that could have predicted Tesla's surprise. Many of us living outside the brokerage firms had no trouble seeing this. Many of us were also hounded on message boards and comment posts as "haters" or "bashers", largely on the grounds that (a) Musk and the Fremont/Palo Alto gang are so smart they couldn't POSSIBLY have miscalculated the expense and risk, and (b) all these analysts know what they're talking about. But if "the world expects" the problems and delays, why didn't a single soul on the Conference Calls ever question the stated schedule commitments? Why did every major sell side analyst expressing a Buy/Overweight tout the $560-600M projection? Apparently, you have never been involved with "real" analysis in which people who have a genuine understanding of the industry in which they operate dig in and flyspeck estimates. That Tesla "tightened" the FY13 projection of $550M-600M by $10M on the low end at the Q2 call had most of us rolling on the floor, yet major firms such as MS, GS and others reprinted it in their analysis. If you think it's OK to spend money, either for client analysis reports or in fund fees from multi-$B firms , by all means believe whatever you hear. Apparently your dog does math better than the entire cadre of analysts covering TSLA, all of whom had overestimated revenue and underestimated losses prior to the recent announcement. They will all tell us "oh, yeah we knew that". Yet they provided data that said they believed a completely different story. It's great to know that everyone (and your dog) knew that Q3 delivery forecasts would drop by 75% in the course of three months, that revenue was overstated by at least 25%, that cash burn was occurring at a far greater rate than advertised, that a raise was not "unnecessary" but in fact vital, and that the Loan Agreement was being negotiated to its fourth amendment in 18 months in order to avoid violating the covenants. You have a freaking awesome dog. Next time have him check your posts before you submit.
          Giza Plateau
          • 8 Months Ago
          @oktrader
          oktrader, what I got from the SEC filing is that Tesla can't repay the loan as intended starting in December and may not be able to in 2013 either. And Tesla/Elon has boasted early repayment not that many months ago, I think it was around the 'launch' or a little prior. Despite these letdowns the stock market is still enthusiastic. It reacted briefly (-7%) to Tesla officially admitting that production ramp up was slower than planned which is an understatement but the price quickly rose again. It seems all the analysts are oblivious of what's going on and big money is still ready to feed them more money to lose. How do you read it?
          purrpullberra
          • 8 Months Ago
          @oktrader
          *Soon should be Elon.
          Letstakeawalk
          • 8 Months Ago
          @oktrader
          " I would be particularly concerned if I were paying for the analysis, which PREDICTS the company's financial health." Ahh, I see the issue! ABG readers are *absolutely convinced* that an analyst firm, by the very nature of his job, provides the information biased in the way his customer wants to read it. They are convinced that the only way an analyst can stay in business is if they continue to provide reports favorable to what their customer wants to hear, and that an analyst that provides a contrary opinion - even if it is backed up by facts and research - will not be employed by that company very long. Just see all the accusations hurled at Pike Research in particular... Tesla enthusiasts on ABG want to hear that everything is rosy at TSLA. That's why they question the motives of anyone who counters what their analysts tell them.
          raktmn
          • 8 Months Ago
          @oktrader
          Why do you think you are the only person to predict that an EV company like Tesla would deliver behind schedule? I think everyone in the world expects every EV to all get delivered behind schedule. It isn't just EV's, it is everything else too. Every new game system and new phone all have production delays. I don't think any professional investors are ever shocked when companies have delays in new products. They probably all expect it, but they aren't going to go running down the street shouting about it before the delays actually happen. Or go patting themselves on the back in public when they predict something as obvious as a delay in an EV car going to market. My dog could predict something that obvious.
          Grendal
          • 8 Months Ago
          @oktrader
          It was from your posts here that I phrased my post the way I did. That Tesla is technically breaking the rules/covenants of the DOE loan but they have been given a "pass" by agreeing to pay the loan back early. My point was that, while that was true, they had already been saying (by Elon in interviews - not legally binding) that they were going to pay it back early anyway. So the net result is that Tesla really got away with no penalty at all if they were going to pay back early anyway. I'm sure I didn't phrase my comment well enough to impart the information I was trying to impart. For that matter I doubt I phrased this comment very well either.
          purrpullberra
          • 8 Months Ago
          @oktrader
          Raktm: trader focuses on all the negatives. He is in for profit, nothing more is behind his motives. I'm the one who has insulted him for this, He can't understand that the numbers of people who can buy this stock and car for 'better' reasons are large enough to get this done as evidenced by the current deposits. He'll knock 200 deposits a month on model and claim Soon duped the market again about'modelx development' when they are so similar that all models development IS modelx development. Tesla living to build the models is the only development needed really, maybe just a few key folks purely on the x. He's giving free market advice and it's worth every penny. ;)
          Rotation
          • 8 Months Ago
          @oktrader
          Grendal: For a company with need of capital, paying back early is not something you should do voluntarily. While I do agree Tesla was not inordinately punished for not satisfying the conditions of the program (not maintaining capital reserve commitments), they are doing something (repaying early) that they would not otherwise do. Make no mistake, any early repayment is not Tesla's idea, it's being pushed upon them. The savings to them of not keeping that capital is far too small to make up for the risks. For example, they wouldn't be selling equity if they didn't need capital. Don't mistake this for me condemning Tesla's product. It's just that they are in a capital crunch in a capital-intensive business.
        Letstakeawalk
        • 8 Months Ago
        @Grendal
        When you say "early", do you mean that Tesla will begin repayment ahead of schedule (not really a big deal, repayments are supposed to start in Dec 2012 according to original agreement), or that Tesla will repay the entire loan amount before the *final* payment date - sometime in 2022 (again, big whoop). I'm sure oktrader has seen this doc, but I'll post the Conditional Commitment Letter again here. http://www.lgprogram.energy.gov/wp-content/uploads/2010/09/TESLACONDITIONALCOM.pdf
      Spec
      • 8 Months Ago
      Very nice of Elon to step up and buy some shares. They need to get cars out the door and bring in revenue. I know they are still in start-up mode but this is the second car and they had their IPO. They need to enter normal operating mode.
      kidcharlemgne
      • 8 Months Ago
      "What I don't like is that the loans are targeted towards building cars rather than homing in on technology development." oktrader, you have a decent background in finance. When it comes to engineering and "technology development," please refrain from commenting. Being qualified in one field does not an expert make in all.
      • 8 Months Ago
      I think I'd invest IF Consumer Reports had a full review done already.....
        Ashton
        • 8 Months Ago
        I'm not investing in Tesla...because I have no money too invest with. lol otherwise I would. In response to Consumer Reports...I'm really hoping they review this car...if anyone would find its flaws (if it has any) it would be them.
        purrpullberra
        • 8 Months Ago
        I agree that if they also give a great review it wuld legitimize Tesla in many importantbways. They won't give a recommend, it's too new, they are a modern sign, a "goodhousekeeping seal" as it were so they can't but they will nearly freak. Oh, they won't like the visibility to the rear.
      purrpullberra
      • 8 Months Ago
      I really liked this thread on the TESLA forum where those who received their models let others know what exact reservations are being filled, from in the car maybe? Anyway, one roadster owner was remarking that not only was his models out-accelerating it but he was really feeling dizzy as he tested the acceleration and throwing the tail out a bit. There was quite bit of consternation and 'OMG what-ifs' then the guy came back 24 hours later telling everyone that he was getting very sick, settling things down with all the desperate soon-to-be owners. They all keep saying that its better than they hoped or were promised. It's not a huge sample but only one long time forum member has supposedly said he's had it, out of several hundred. It was the $2000 charge for 60 kWh car owners to fully integrate supercharger access even though this person was going walk-in. He had been promised too much that has finally angered him(?). He's been waiting 3 years and everyone there is urging him to wait naturally. He's likely to get over it. Some won't be able to afford the 60kWh due to the $600/year 'maintenance' with this $2000 as well. You can't say you'll save on the lower maintenance and use the supercharger enough to justify the 2k. It's a forced add-on for resale only. Those folks are probably not gonna get one instead waiting for genIII.
    • Load More Comments
    Share This Photo X