They were only able to raise about half of what they needed so far. Either they didn't wait until it closed at the full amount because they needed the currently raised money asap and then hoped more would come. Or less ominously, there simply was no more interest in the offering and decided to wrap it up.
Now that the logjam has been cleared, you may now both proceed with your spin.
As I pointed out previously when you asked for a citation, the important date for the convertibles is Dec 31 where the covenants require a set level of cash.
(Btw, has to be said that the Citron manipulation was a very nice addition to the usual pre-earnings pump, didn't expect that at all. Usually only play 10% otm calls going into earnings. But in this case will be adding some common on top this morning because the poo stew of accounting is so delicious this quarter.)
"Some service employees said they were surprised to learn that when they sent mechanics to help out with "bursts" to build new vehicles in the Fremont factory, their time was billed either to "training" or "research and development," rather than service or vehicle assembly. "
They were under investigation long before the 420 tweet, and the denial in the Q2 call was legal needle-threading to avoid disclosure to investors:
"The action by the S.E.C. is solely related to events surrounding Mr. Musk’s comments on Twitter. But regulators had been investigating Tesla even before the tweet, and are more broadly examining whether Tesla misled investors about its production goals."
There was no term sheet. No 8-Ks were filed. The Saudis and VW denied they were in any specific talks. The tweet was solely intended to force shorts to cover.
April, based on the balance sheet. Then rolling puts based on the poor manufacturing quality, executive exodus, bond yield crash, etc.
No worries about freedom from oil. The offerings from Jaguar, Mercedes, and Audi will supplant Tesla and drastically increase adoption with more affordable models. Long some NIO too.
Love the electric car concept, definitely planning on buying one of the aforementioned three when the time is right.
1) A/P is certainly a valid consideration when a company asks their vendors to refund cash. This request made by Tesla was a clear indicator of distress, not a negotiating tactic.
2) Meeting the unrestricted cash on hand requirement (actually $920m+$400m=$1.32b) for the March converts occurs in approx 11 weeks (Jan 1).
4) As of mid-August that figure was $1.69B per the WSJ. But as you know Tesla does not break out customer deposits as that would reveal the amount of actual demand for their products. Coupled with the status of the ABL, it's unclear where they stand now.
5) No, I don't know the current price of ZEV credits because they are negotiated. It's been widely reported that demand is down from other manufacturers. Citations are available via Google.
Incorrect. For every share that is shorted, a new long share is created. The total net outstanding shares remains the same. Therefore the stock "value" nor any common shareholder's voting rights are affected.
Incorrect, $230m is a ton of money to them. The Fremont factory has already been mortgaged. A/P is at over $3B. The backlog of ZEV credits are worth a fraction of what they were last year. Have you actually read their the last 10-Q, or at a base minimum, their balance sheet?
And March is actually 11 weeks away, Tesla must have $800m in unencumbered cash by the end of Dec or be in violation of the covenants.
A few notes: There is reporting out a couple hours ago that a financing package is still being attempted: https://twitter.com/CGasparino... By the wording, it appears to be a DIP package but would be cautious assuming that (still think it's a few months though: https://slashdot.org/comments....).
The Solar City bond payment of $230m is almost here as well as the massive March convert so something needs to be done as the Q3 numbers are almost certainly dismal. And any talk of senior refinancing will certainly cause some suppliers to go COD hindering production greatly.
As far as its effects on the equity, it's clearly going to be just above worthless in any deal, but it could hang out in double-digits for a while. And don't forget that a drop below $200 will snowball Elon's pledged shares into margin-call territory. So be cautious about any sub-$100 puts that look oh-so-tasty, stick with the closer strikes.
Lastly, Musk's attacks on shortsellers are simply scapegoating and desperation at this point. The amount of short shares available is plentiful and actually increased yesterday during the big drop. The downward pressure was clearly large long holders dumping. The blame for this company's failure is solely on his shoulders.
From a technical perspective, I honestly wish everything you said was true. Personally I'd love to buy an electric car now (and powerwall-type product) but given the large investment it would have to be from a stable manufacturer.
Since it's pretty clear now that Tesla is a few months away from being forced into DIP financing based on their convertibles situation, and what the bond yields and CDS rates are saying, it's definitely a no-go. Even in chapter 11 I wouldn't trust that any warranty promises could be fulfilled in a timely manner, if at all.
However the slew of models coming from established manufacturers in the next year is heartening. The Jaguar I-Pace and Porsche Taycan look very promising so it appears we really are at the tipping point of mass adoption. So that's at least a positive in gradual evolution of electric vehicles.
Re: character flaw, calling the diver in the Thailand rescue a pedophile this morning lends credence to the fact that he doesn't listen to his large investors, let alone those related to development of the company's product.
A while back Baillie clearly told him to shut up with the unprofessional tweeting and focus on the work. And it seems they're not alone. The other large funds are clearly spooked by the balance sheet, product defects and CEO behavior and have been dumping their common positions (i.e. the least-senior in bankruptcy). Fidelity primarily but even TRowe, the most steadfast, is showing signs they fear the worst: https://twitter.com/WintonCapP...).
Of course if we have truly have entered an era where you can say anything without repercussion from other stakeholders, and can make your own reality, then none of this matters and the cult mentality will continue. What that says about the future of corporate governance and execution in this country is left as an exercise to the reader.
It's a time-honored tradition for companies that ended up with a "Q" at the end of their symbol to have blamed the media and shorts for their declining stock price along the way. But in the end all that mattered is what the 10-Q/Ks said.
Having said that, the borrow rate is not flashing any serious warning signs yet, it's pretty low at sub-2% (and plenty of shares available). And the massive option premiums are inline with the extreme vol of the underlying.
However the really concerning thing is that the CDS probability blowing out to 40% is saying that the shorts are definitely right about the financial health/prospects of the company, and (ime) these usually resolve to default quicker than most anticipate: https://twitter.com/Sunchartis...
Since most kids/parents have gamed the standardized tests so well, this will probably relieve some pressure on admissions folk to focus on the truly curious and motivated applicants regardless of score. Akin to showing your Gitlab projects to a prospective employer instead of a resume bragging about your umpteen MCSE certs but not knowing how to actually do anything.
New features+specs are nice and definitely drive a majority of sales. But don't forget they are forcing obsolescence by having non-upgradeable RAM and SSD in the latest machines. And that's not just requiring signed SSD drivers so you can't pop a cheaper Micron in it, SSD is now a soldered component. For anyone who cares about upgradability, you have to go (less than or equal to) early 2015 to get a machine with both non-soldered RAM and SSD. Those folks are pretty much shut out from purchasing a new machine because they're not the types to pay for the megapriced 16GB+1TB SSD.
So one could argue 128GB fixed SSD and 8GB RAM is one way of forcing obsolescence on the lowest prices Macbook pros (btw not in terms of SSD wear, just purely outgrowing size/memory). Of course this isn't the majority of Macbook buyers and would just be a blip in sales. But any dent in average resale value down the road hurts the overall brand.
Agreed. Heck, Apple gave away Snow Leopard and Mountain Lion for free. And not to be outdone, Microsoft recently was begging folks to take their mangy alleycat that kept peeking into everyone's windows.
Slashdot Mirror
Oy. Here, I'll do the homework for both of you:
Total Offering Amount $499,999,992 USD
Total Amount Sold $273,199,776 USD
Total Remaining to be Sold $226,800,216 USD
Source: https://www.sec.gov/Archives/e...
They were only able to raise about half of what they needed so far. Either they didn't wait until it closed at the full amount because they needed the currently raised money asap and then hoped more would come. Or less ominously, there simply was no more interest in the offering and decided to wrap it up.
Now that the logjam has been cleared, you may now both proceed with your spin.
Agreed, the Jun 21 '19 180 puts are a much better buy...and you can buy 30x as much ;)
As I pointed out previously when you asked for a citation, the important date for the convertibles is Dec 31 where the covenants require a set level of cash.
(Btw, has to be said that the Citron manipulation was a very nice addition to the usual pre-earnings pump, didn't expect that at all. Usually only play 10% otm calls going into earnings. But in this case will be adding some common on top this morning because the poo stew of accounting is so delicious this quarter.)
Hmm.
"Some service employees said they were surprised to learn that when they sent mechanics to help out with "bursts" to build new vehicles in the Fremont factory, their time was billed either to "training" or "research and development," rather than service or vehicle assembly. "
https://www.cnbc.com/2018/10/1...
They were under investigation long before the 420 tweet, and the denial in the Q2 call was legal needle-threading to avoid disclosure to investors:
"The action by the S.E.C. is solely related to events surrounding Mr. Musk’s comments on Twitter. But regulators had been investigating Tesla even before the tweet, and are more broadly examining whether Tesla misled investors about its production goals."
https://www.nytimes.com/2018/0...
Credit where it's due, back in February he nailed the fact that the SEC had an investigation open:
http://www.crazydaysandnights....
Doesn't look like the girlfriend thing panned out though.
Fraud is clearly characterized. The complaint spells it all out:
https://www.sec.gov/litigation...
There was no term sheet. No 8-Ks were filed. The Saudis and VW denied they were in any specific talks. The tweet was solely intended to force shorts to cover.
April, based on the balance sheet. Then rolling puts based on the poor manufacturing quality, executive exodus, bond yield crash, etc.
No worries about freedom from oil. The offerings from Jaguar, Mercedes, and Audi will supplant Tesla and drastically increase adoption with more affordable models. Long some NIO too.
Love the electric car concept, definitely planning on buying one of the aforementioned three when the time is right.
1) A/P is certainly a valid consideration when a company asks their vendors to refund cash. This request made by Tesla was a clear indicator of distress, not a negotiating tactic.
2) Meeting the unrestricted cash on hand requirement (actually $920m+$400m=$1.32b) for the March converts occurs in approx 11 weeks (Jan 1).
3) As requested, citation from the covenants document:
https://mobile.twitter.com/Pau...
4) As of mid-August that figure was $1.69B per the WSJ. But as you know Tesla does not break out customer deposits as that would reveal the amount of actual demand for their products. Coupled with the status of the ABL, it's unclear where they stand now.
5) No, I don't know the current price of ZEV credits because they are negotiated. It's been widely reported that demand is down from other manufacturers. Citations are available via Google.
"Shorting inherently reduces the stock value."
Incorrect. For every share that is shorted, a new long share is created. The total net outstanding shares remains the same. Therefore the stock "value" nor any common shareholder's voting rights are affected.
Incorrect, $230m is a ton of money to them. The Fremont factory has already been mortgaged. A/P is at over $3B. The backlog of ZEV credits are worth a fraction of what they were last year. Have you actually read their the last 10-Q, or at a base minimum, their balance sheet?
And March is actually 11 weeks away, Tesla must have $800m in unencumbered cash by the end of Dec or be in violation of the covenants.
A few notes: There is reporting out a couple hours ago that a financing package is still being attempted: https://twitter.com/CGasparino... By the wording, it appears to be a DIP package but would be cautious assuming that (still think it's a few months though: https://slashdot.org/comments....).
The Solar City bond payment of $230m is almost here as well as the massive March convert so something needs to be done as the Q3 numbers are almost certainly dismal. And any talk of senior refinancing will certainly cause some suppliers to go COD hindering production greatly.
As far as its effects on the equity, it's clearly going to be just above worthless in any deal, but it could hang out in double-digits for a while. And don't forget that a drop below $200 will snowball Elon's pledged shares into margin-call territory. So be cautious about any sub-$100 puts that look oh-so-tasty, stick with the closer strikes.
Lastly, Musk's attacks on shortsellers are simply scapegoating and desperation at this point. The amount of short shares available is plentiful and actually increased yesterday during the big drop. The downward pressure was clearly large long holders dumping. The blame for this company's failure is solely on his shoulders.
From a technical perspective, I honestly wish everything you said was true. Personally I'd love to buy an electric car now (and powerwall-type product) but given the large investment it would have to be from a stable manufacturer.
Since it's pretty clear now that Tesla is a few months away from being forced into DIP financing based on their convertibles situation, and what the bond yields and CDS rates are saying, it's definitely a no-go. Even in chapter 11 I wouldn't trust that any warranty promises could be fulfilled in a timely manner, if at all.
However the slew of models coming from established manufacturers in the next year is heartening. The Jaguar I-Pace and Porsche Taycan look very promising so it appears we really are at the tipping point of mass adoption. So that's at least a positive in gradual evolution of electric vehicles.
Re: character flaw, calling the diver in the Thailand rescue a pedophile this morning lends credence to the fact that he doesn't listen to his large investors, let alone those related to development of the company's product.
https://twitter.com/MidwestHed...
https://twitter.com/TeslaChart...
A while back Baillie clearly told him to shut up with the unprofessional tweeting and focus on the work. And it seems they're not alone. The other large funds are clearly spooked by the balance sheet, product defects and CEO behavior and have been dumping their common positions (i.e. the least-senior in bankruptcy). Fidelity primarily but even TRowe, the most steadfast, is showing signs they fear the worst: https://twitter.com/WintonCapP...).
Of course if we have truly have entered an era where you can say anything without repercussion from other stakeholders, and can make your own reality, then none of this matters and the cult mentality will continue. What that says about the future of corporate governance and execution in this country is left as an exercise to the reader.
It's a time-honored tradition for companies that ended up with a "Q" at the end of their symbol to have blamed the media and shorts for their declining stock price along the way. But in the end all that mattered is what the 10-Q/Ks said.
Having said that, the borrow rate is not flashing any serious warning signs yet, it's pretty low at sub-2% (and plenty of shares available). And the massive option premiums are inline with the extreme vol of the underlying.
However the really concerning thing is that the CDS probability blowing out to 40% is saying that the shorts are definitely right about the financial health/prospects of the company, and (ime) these usually resolve to default quicker than most anticipate:
https://twitter.com/Sunchartis...
Since most kids/parents have gamed the standardized tests so well, this will probably relieve some pressure on admissions folk to focus on the truly curious and motivated applicants regardless of score. Akin to showing your Gitlab projects to a prospective employer instead of a resume bragging about your umpteen MCSE certs but not knowing how to actually do anything.
I have a friend who is a quadriplegic and lives in an electric chair.
Hopefully he's configured the recognition output for "flip switch" to /dev/null ;)
(Seriously though, his story is both impressive and uplifting. Good on him.)
Yeah, he wasn't allowed back to work until he completed this.
That's what I'll be using. But only if the algorithm can handle pictures that must be taken in panoramic mode.
Also worth noting that the EFF is a charity choice for smile.amazon.com. Every penny helps.
Sure there is, and lots of them. They're called Mom's basement.
Nah, cheer up. You'll know it's really over when you need to take the blue pill.
UMich was part of the show but the plastic battery segment was actually Zimmerman at Tufts:
http://www.pbs.org/wgbh/nova/n...
New features+specs are nice and definitely drive a majority of sales. But don't forget they are forcing obsolescence by having non-upgradeable RAM and SSD in the latest machines. And that's not just requiring signed SSD drivers so you can't pop a cheaper Micron in it, SSD is now a soldered component. For anyone who cares about upgradability, you have to go (less than or equal to) early 2015 to get a machine with both non-soldered RAM and SSD. Those folks are pretty much shut out from purchasing a new machine because they're not the types to pay for the megapriced 16GB+1TB SSD.
So one could argue 128GB fixed SSD and 8GB RAM is one way of forcing obsolescence on the lowest prices Macbook pros (btw not in terms of SSD wear, just purely outgrowing size/memory). Of course this isn't the majority of Macbook buyers and would just be a blip in sales. But any dent in average resale value down the road hurts the overall brand.
Agreed. Heck, Apple gave away Snow Leopard and Mountain Lion for free. And not to be outdone, Microsoft recently was begging folks to take their mangy alleycat that kept peeking into everyone's windows.