Tesla (NASDAQ:TSLA) Looking Back Over the Year.5

Tesla (NASDAQ:TSLA) Looking Back Over the Past Year.5


In the wake of his recent Axios interview of Tesla (NASDAQ:TSLA) CEO Elon Musk broadcast a lot of stuff to his listeners and devotees. Much is hyperbole, some is fact.

Below are of some things that happened at the fledgling US EV maker over the past year.5, as follows:

  • Short sellers claimed Tesla was heading for bankruptcy and/or needed to raise a lot of capital, and placed their bets
  • Tesla said it did not need to raise additional capital to cover its massive debt
  • CEO Musk did an Axios interview and admitted Tesla was “bleeding money like crazy” plus was “single-digit weeks” of death at some point in the past year or so
  • Despite validating short-sellers’ earlier suspicions, the stock is up WTD.

People this stuff from Mr. Musk is not entertaining

On April Fool’s Day last, Elon Musk Tweeted a series of jokes about the supposed risk of Tesla going “bankwupt.”

The Big Q: Was this during the actual “single-digit weeks” period in question?

The Big A: Yes, it is possible, as Tesla burned almost $1.7-B in cash in 1-H of Y 2018.

Just a couple of days after Mr. Musk’s Tweets, the company disclosed it had missed its reduced Q-1 production target for the M-3 car; the fuel for burning all of that cash.

Tesla has been “bleeding money” for much of the past 1.5 yrs of M-3 production Hell.

In that same release Tesla went out of its way to say it “does not require an equity or debt raise this year, apart from standard credit lines.”

Ok , then that cannot have been the crash frame in question, because how could Tesla proclaim financial robustness even as the edge of the gorge came into view?

If not then when?

Tesla has had boilerplate risk-factor stuff in its Quarterly and annual filings about having enough cash to service debt and has also admitted problems with the M-3’s production schedule. But, there were not any public disclosure of potentially imminent corporate collapse in the past 1.5 years.

One might think a responsible company COB/CEO would refrain from making public statements at odds with public statements.

Especially when he just had to settle a lawsuit with the SEC due to problematic public statements about a potential takeover that suffered not attachment to reality, recall the ‘420’ buyout!

That Commission settlement forced him to give up his position as company Chairman and submit future public statements for vetting.

The Axios interview came soon after surprisingly positive Q-3 results, albeit with lingering questions about how sustainable they are, owing to the accounting tricks and booking of green like credits sold to other car makers.

In revealing Tesla’s near-death experience, Mr. Musk’s interview offers some vindication to short-sellers, and provides a narrative for Bulls that the worst may be behind the company. I do not think so.

The latter aligns with the perception held by committed fans of Tesla being an underdog able to engineer its way out of even the most dire circumstances like a magician pulling well rehearsed tricks on his/her audience.

Overall, Mr. Musk bolsters 1 of the Key arguments of those betting against him, even as he revives continuing concerns about liquidity and governance.

He is a fascinating Guy, but Why?

HeffX-LTN Analysis for TSLA: Overall Short Intermediate Long
Bullish (0.32) Neutral (0.13) Very Bullish (0.50) Bullish (0.35)

Stay tuned…

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