ERICOPOLY

How much assets and equity does Porsche employ to build 200k cars? What's its ROE? Are you constructive going to short it? They are making more than $10k profit on each car, on volume of 200,000 next year. Seems like you "constructive" believe the market can't support that right? (I know, VW already bought them).

Why are they a Tesla competitor? Should Ferrari be afraid of BYD? BMW? GM? Why Tesla specifically? Their E6 electric car is downright homely. Was Heidi Fleiss afraid of street prostitutes doing $50 tricks?

It's interesting -- 200,000 cars for a maker that reported 50% gross margins on a technology (InternalCombustionEngine) with lots of competition: Porsche, which in past years had a gross margin of more than 50 percent on its luxury sports cars, was acquired by Volkswagen AG (VOW) and no longer reports that ratio separately. http://www.bloomberg.com/news/2013-06-05/musk-says-tesla-s-gross-margin-can-approach-porsche-over-time-.html Musk Says Tesla Gross Margin to Approach Porsche’s “On gross margin, I think we can get close to exceeding Porsche’s over time.”

How much margin does Porsche make on a car? What's to stop competitors from making ICE's to compete with them? And if other car makers make ICE's, then what happens to Porsche's margin and sales?

Porsche is actually up to 200,000 per year: Porsche AG Chief Executive Officer Matthias Mueller said the high-end automaker will exceed 200,000 in annual deliveries in 2015, three years earlier than first targeted, on demand for the Macan compact sport-utility vehicle going on sale later this year. http://www.bloomberg.com/news/2014-02-10/porsche-to-exceed-200-000-in-sales-next-year-on-macan.html?cmpid=yhoo

A car company can't make a $10k profit on a car? 500,000 luxury cars? Scratches head... Is the Gen III is a luxury car??? Good point. I have one for you too... if the discount rate is 100%, every stock is expensive. I hope that helps!

Tesla's PDF you linked suggests the Gigafactory will reduce battery costs 30%. Considering the plant isn't designed yet, it's clear that this is a rough guess. Oh, no, it's a very precise statement of a fact, several years out ;)

Are you sure it's not 4.7x 2030 earnings? Me? Hah! I stay out of this fight (no dog) because I admit that nobody knows what the IV is. The 500,000 car scenario is perfectly rational. In which case, the stock is not above IV. But we don't know. A 200,000 car scenario is also possible. Porsche seems to sell quite a few luxury cars. I think they sold something like 130,000 luxury cars in 2012.

I kept it at $10k profit per vehicle average as just a guess. The fully loaded Model S might be more than $60k profit. The Gen III vehicle, far less than that. So just average around $10k maybe. Who knows? The short sellers don't know. They "know", what they really don't know. They are just speculating.

Tesla is expecting 27% pre-tax margin on the Model S in Q4 2014. I wonder what the margin will be when they halve the cost of their battery pack (Gigafactory driving down the cost).

Some more math: 500,000 vehicle volume in 2020 $10,000 average profit per vehicle before tax That's $5 billion profit, before tax. Give it a 25% tax rate, for $3.75b. So the stock today trades at 8.3x 2020 earnings. 2020 vehicle volume estimate comes from here: http://www.teslamotors.com/sites/default/files/blog_attachments/gigafactory.pdf So it's cheaper than the index. Assuming the above math/assumptions is right.

I can't figure out their math -- 3.5 basis points on $1.9 trillion is only $665 million. However the article claims it is $2.7 billion: quoting: The biggest U.S. banks and insurance companies would have to pay a quarterly 3.5 basis-point tax on assets exceeding $500 billion under a plan to be unveiled this week by Congress’s top Republican tax writer. quoting: The basic arithmetic suggests that JPMorgan, which had $2.4 trillion in assets at the end of 2013, would pay $2.7 billion a year, or about 15 percent of 2013 net income. http://www.bloomberg.com/news/2014-02-25/biggest-banks-said-to-face-asset-tax-in-republican-plan.html

My system has been to cheat off of others. I realized that if I started by going through 27,000 public companies I would make all kinds of mistakes thinking I had a shot of becoming the next Warren Buffett. I would have discovered every kind of financial shenanigan the hard way. So instead I figured out who some of the better investors were, and limited myself to stocks that they hold in their portfolios. This way, those investors serve as a screen that filters out a lot of the junk. It's a more sanitized population of stocks. Not guaranteed to be sterile, but getting closer on that spectrum. I did very well with this technique. It's like having a loosely coupled team of analysts working for me for free. I wrote about this technique a couple of years back. Then a couple of months ago I noticed that Mohnish was talking about the very same thing. So I like his approach!

Yep, no BYD cars in the "green" area, where electric cars have the most promise.

Except that the battery is 50% of the cost of the car so having cost advantages in battery production actually DOES matter. This is an excellent point to revisit in light of news of the upcoming battery factory. Still not vertically integrated? BTW: How come I haven't seen a BYD car on the road?

That battery plant keeps on getting cheaper if they pay for it in TSLA stock! There has been speculation about Apple's M&A person talking to Musk and icars and other foolishness but is it not reasonable to assume a great partnership between the two on this battery plant? Apple\s got tons of money and uses tons of batteries. It would actually be a sensible and prudent use of their cash - as opposed to buying an instant messaging app or something similar. Tesla supplies batteries to Solar City as well -- the residential battery packs. So you can imagine this plant to be producing lots of batteries for homes and businesses to store energy off-peak for use during peak.

So it seems like market cap of TSLA has now caught up with Porsche.

OMG Becky! Like, for real, the weather forecast is for sub-60 degree weather this Friday! That hasn't happend in like, OMG, not yet this year!

Never -- too scary. The next step is buying a Tesla Model X next year for my wife to drive. She hates having to fill her BMW with gas. She is envious that I never have to stop for gas, I never have to think about the oil level, the oil change, and bringing it into the shop for annual service. All of that annoying car ownership stuff -- it all disappears with Tesla.

Tesla service at my house! These guys are awesome. I bet Porsche doesn't do that.

Pretty much sums it up right there.

Roughly 30% went to MPIC.

Me? No, the reason why I recently retired from managing my RothIRA (as well as my wife's) is to eliminate myself as the systemic risk to my family's financial security :) Sometimes you need to hand the keys to a friend when you are at the party if you know you have a problem.

I don't think the short sellers have any real idea of what Tesla's IV is. Shorting it just seems speculative.

Article about the planned Tesla battery plant: http://money.cnn.com/2014/02/22/autos/tesla-gigafactory/index.html?hpt=hp_t2 The size of the plant will be massive. Musk predicted in November that it would have a capacity equal to all factories making lithium ion batteries around the globe. That includes lithium batteries going into Teslas as well as laptops, tablets and smart phones. The company has given no clues about the cost of the plant, though Musk suggested Wednesday the company may issue more shares of its high-flying stock to raise some of the cash it needs to build it. Kallo thinks the plant could cost $2 billion to $5 billion. Irwin says the cost could top $10 billion.