Tesla, Wall Street and The Future
There is Wall Street and there is the rest of the world. Us in the real world get lots of cool information about the future, but wall street is only interested in a part of it. This is how it evolved for over 100 years. Wall street’s focus is past performance and the next 6 months, and is highly concentrates on profit and loss but especially growing profits. Any story that will highlight growth or decline of dollar flow in the next 6 months counts, otherwise, pretty much ignored.
These days, the Wall Street focus for Tesla is AUTOMOTIVE and ENERGY.
For AUTOMOTIVE, Tesla has a pretty long history and quarterly results and future predictions. Lots of historical growth. For Tesla there is some softness, which can put a drag on the stock.
ENERGY is a relatively new story and the potential is for energy to exceed the automotive margins. The business decision is a spreadsheet. The challenge is meeting demand for Tesla MEGA-PACKS and the adoption of Tesla HOME SOLAR.
The delay of the ROBO-TAXI launch, is translated to Wall Street as a delay of the start of the cask flow potential. This can put a drag on the stock.
The amount of dollars involved with the Tesla SEMI are too small today. The profit potential is huge, but factories have to be built, etc.
Tesla OPTIMUS is also years away from being a profitable segment of Tesla. Wall Street is ignoring it. Elon is said Optimus could be the most profitable division of Tesla.
Tesla AUTOMOTIVE INSURANCE is have a really good uptake in some European countries, but seem to be stalled in the US. Wall Street is ignoring it.
OPTIMIZATION. Tesla is known as a relentless optimization machine. A single panel vs. tons of screens and switches (look inside a Ford Lightning sometime. Octovalve, steer-by-wire, 48 volts wiring, w-fi controls. optimization but we don’t know what is next. I am thinking the battery dry construction process that they have worked on for 6 years revolutionizing the 4680.
Capitol vs. Operating.
Capitol is the easiest to get. A lump sum added to an annual budget. If there is a problem with something, say public health, the politicians will tend to throw one time money at it.
Operating is the real challenge. You add to your operating budget and you have to find those dollars every year. However, a saving in operations makes you a hero.
The recent example of the police dept. https://www.tesla-mag.com/en/south-pasadena-unveils-nations-first-all-electric-police-fleet/. One annual capitol cash injection and the annual operating budget is reduced for every subsequent year. Responsible use of public funds. A spreadsheet decision.
Ignored things: Semi and Cybertruck
There is Wall Street and there is the rest of the world. Us in the real world get lots of cool information about the future, but wall street is only interested in a part of it. This is how it evolved for over 100 years. Wall street’s focus is past performance and the next 6 months, and is highly concentrates on profit and loss but especially growing profits. Any story that will highlight growth or decline of dollar flow in the next 6 months counts, otherwise, pretty much ignored.
These days, the Wall Street focus for Tesla is AUTOMOTIVE and ENERGY.
For AUTOMOTIVE, Tesla has a pretty long history and quarterly results and future predictions. Lots of historical growth. For Tesla there is some softness, which can put a drag on the stock.
ENERGY is a relatively new story and the potential is for energy to exceed the automotive margins. The business decision is a spreadsheet. The challenge is meeting demand for Tesla MEGA-PACKS and the adoption of Tesla HOME SOLAR.
The delay of the ROBO-TAXI launch, is translated to Wall Street as a delay of the start of the cask flow potential. This can put a drag on the stock.
The amount of dollars involved with the Tesla SEMI are too small today. The profit potential is huge, but factories have to be built, etc.
Tesla OPTIMUS is also years away from being a profitable segment of Tesla. Wall Street is ignoring it. Elon is said Optimus could be the most profitable division of Tesla.
Tesla AUTOMOTIVE INSURANCE is have a really good uptake in some European countries, but seem to be stalled in the US. Wall Street is ignoring it.
OPTIMIZATION. Tesla is known as a relentless optimization machine. A single panel vs. tons of screens and switches (look inside a Ford Lightning sometime. Octovalve, steer-by-wire, 48 volts wiring, w-fi controls. optimization but we don’t know what is next. I am thinking the battery dry construction process that they have worked on for 6 years revolutionizing the 4680.
Capitol vs. Operating.
Capitol is the easiest to get. A lump sum added to an annual budget. If there is a problem with something, say public health, the politicians will tend to throw one time money at it.
Operating is the real challenge. You add to your operating budget and you have to find those dollars every year. However, a saving in operations makes you a hero.
The recent example of the police dept. https://www.tesla-mag.com/en/south-pasadena-unveils-nations-first-all-electric-police-fleet/. One annual capitol cash injection and the annual operating budget is reduced for every subsequent year. Responsible use of public funds. A spreadsheet decision.
Ignored things: Semi and Cybertruck