Published on January 3rd, 2019 | by Zachary Shahan0
Tesla Crushes Records, Wall Street Expects More — Miracles?
January 3rd, 2019 by Zachary Shahan
I have to admit, it’s pretty hilarious sometimes to see how Wall Street responds to Tesla news. It’s also hilarious to see the wild and ridiculous nonsense some Tesla [TSLA] short sellers or professional trolls spout. I understand that people live in different internet and ideological bubbles these days, but still, the degree to which some grumbling, mumbling critics grumble and mumble about Tesla (and CleanTechnica) cracks me up from time to time.
I’ll go back really far before jumping to this week. Back in early 2013, a series of Tesla stories came out that made me think Tesla had a really strong year or two ahead of it. I mean, I expected more than a strong year or two, but that timeframe seemed so obviously solid that betting against the company seemed totally idiotic. I was confused why the stock price didn’t soar. But it did a few months later.
Wall Street hasn’t broken its pattern much since then. Tesla has great news, Elon Musk explains why its great, and the market doesn’t respond. Months later, the market wakes up and you get the expected results — but with all kinds of wild roller coasters in the middle.
The Tesla stock story this week is another funny one to me. Tesla absolutely crushed 2017’s numbers, solidly destroyed the 3rd quarter of 2018’s numbers in the 4th quarter, and verified what was probably the most dramatic growth in the history of the auto industry. Yet, Wall Street decided it wasn’t enough — no miracles in this soup! — and dropped the stock price down a few notches. I don’t really care personally — I’m in for the long haul and expect to see the kind of long-term climbs like we’ve seen with Amazon, Apple, and Google in the past. But I do find it both hilarious and crazy.
But that’s also what the trading-obsessed market is about these days. It’s not about investment for many of the people cumulatively shifting around tens of billions of dollars. It’s about trading — which has a tendency to be divorced from genuine forecasts for the companies of concern, let alone any long-term vision of the future. It’s about expectations for that specific day or quarter, not necessarily expectations for a year later or 10 years later.
Some of the anti-Tesla trolls who have started stalking us on Twitter claim ridiculous things about our articles. They think we care about short-term Tesla stock prices and are trying to “pump up” the stock. Obviously, we are telling the Tesla story in ways that we think are most accurate, useful, and neglected. We work to correct narratives that we think others miss while on one wild goose chase or another. (The parking lots! The parking lots! … The panel gaps! The panel gaps! … A back bumper fell off! … 3,000 cars in inventory, oh my! … Elon got in a Twitter fight — my Lord! … Some executives left Tesla for other great jobs! … The sky is falling! The sky is falling!)
This week, Maarten found it particularly funny that the internet was blowing up about ~3,000 Tesla vehicles reportedly in inventory at the beginning of December 31. He made it clear — by putting things into context and getting into useful details — that ~3,000 vehicles in inventory with a day to go was a sign of Tesla’s huge sales and near sellout. That’s how many cars are produced by Tesla in approximately two days (according to some leaked accounts from Tesla staff). Also recall that Tesla needs to have some cars for showrooms and test drives at stores around the world. Tesla has 125 stores & galleries in the US alone. Just 7 cars at each one would equal 875 cars. It has stores & galleries in another 27 countries.
As we found out this morning, these were Tesla’s 4th quarter numbers for all models:
- 86,555 units produced
- 90,700 units delivered
That’s right — Tesla delivered 4,000+ vehicles more than it produced, significantly eating into its “vehicles in transit” and/or “vehicles in inventory.”
“1,010 Model 3 vehicles and 1,897 Model S and X vehicles were in transit to customers at the end of Q4, and will be delivered in early Q1 2019,” Tesla added. “Our inventory levels remain the smallest in the automotive industry. …”
Tesla had a blowout quarter that resulted in 367% year-over-year growth. Tesla sold 33% more cars in the 4th quarter of 2018 than all of 2017. That’s a pretty stunning result to end the year — yet the headlines were predominantly negative due to a stock price collapse that was somehow due to much higher expectations on Wall Street. That blows me away a little bit, but the other funny thing is that the Teslainternet was just a few days ago hyperventilating about ~3,000 cars in inventory, and then the stock rebounded, and then it collapsed again when it turned out Tesla delivered 4,000 more vehicles than it produced in a record-production quarter and ended with very little inventory. What?
I’m honestly just laughing about it right now. As much as the insane or immoral $TSLAQ conspiracy crowd may assume anyone who writes positively about the positive Tesla story is “trying to pump the stock,” the fact is: we’re just happy to see the progress, and giddy about the coming decade+.