Published on February 1st, 2019 | by Carolyn Fortuna0
My First Tesla Shareholder Call As A Tesla Investor
February 1st, 2019 by Carolyn Fortuna
For most people, you buy a stock because someone you know is excited about it. Maybe that person is a day trader or has a track record of choosing a solid portfolio of growth stocks. That person’s energy and enthusiasm is contagious: you want to jump in and take a teeny portion of your net worth, just a snip of your meager life savings, to a whole new level. And, if that stock is Tesla [TSLA], the thought of becoming a Tesla investor is doubly thrilling, as you’ll be joining a group of visionaries who feel a positive shift toward the future.
I’m one of those new Tesla investors. A longtime educator who apportioned a small amount of my biweekly paycheck into a 403(b) account, I saw my first Tesla in 2013 while traveling through an upscale hippie town in western Connecticut on the way to Lime Rock Raceway. I thought of Tesla at the time as little more than another new car on the market.
Tesla, as the first EV with long enough range to serve as a replacement for a gasoline car, was soon seen as different. It was an EV that was also a practical everyday car. The company created a Supercharger network that had been missing with prior EVs (and other non-Tesla EVs since), making charging options fast and convenient. The company’s CEO, Elon Musk, took good ideas and made them a reality — “the point of all this was, and remains, accelerating the advent of sustainable energy, so that we can imagine far into the future and life is still good.”
Since then, I’ve been writing about environmental issues for CleanTechnica and other EV websites, and I’ve come to understand the special place that Tesla holds in the marketplace. It’s more than an automobile company: it’s a movement, a mission, a disruptor. It’s leading the energy industry toward advanced technologies for a sustainable economy.
No, I don’t own a Tesla automobile. I’d love to own a Model 3, of course! But I’m one of those people to whom Musk referred to in the Q4 2018 earnings call:
“The demand for — the demand for Model 3 is insanely high. The inhibitor is affordability. It’s just like people literally don’t have the money to buy the car. It’s got nothing to do with desire. They just don’t have enough money in their bank account. If the car can be made more affordable, the demand is extraordinary.”
But what I could do was buy Tesla stock. The climate crisis and related growth had already led me to divest from fossil fuel stocks in my existing portfolio. Like many others, I lean toward mission-driven investment strategies, and the trend seems to be pointing in that direction for many others similarly.
In late summer 2018, after Musk announced via Twitter that he had secured enough funding for a massive private buyout of Tesla, the SEC stepped in with sanctions. When Tesla stock dropped in value, I saw an opportunity and made my first purchase. Since then, the stock has risen and, while it is fluctuating, I’m pleased with my decision. I do plan on staying “long,” putting my money into the Tesla movement and feeling like I’m part of something important and rare.
I’ve bet on the future, after all.
Listening to the Investor’s Call with a New Perspective
As a writer for CleanTechnica, I generally tune into the quarterly Tesla shareholder communications. I take notes, read the shareholder letter, listen to the earnings call, and study the subsequent transcript. The late January 2019 communications felt different to me, however. I was one of the people to whom Tesla was speaking!
Several points during the earnings call caught my attention and confirmed my confidence in my Tesla stock.
- Tesla achieved an 80% market share of US EV sales last year.
- The company began construction of the Gigafactory in Shanghai, and by the end of this year, they expect to be producing Model 3s using a complete vehicle production line. Musk acknowledged that the company is getting a lot of support from the Shanghai government as well as the national government.
- With the combination of cells produced at the Gigafactory in Nevada, cells produced in Japan, and cells produced locally in China, Tesla is confident it has a sufficient supply to hit its productions targets there.
- Tesla predicts strong growth in its battery and stationary storage businesses.
- With concern about a 2019 recession looming and possible scenarios of lower volumes and tight pricing, Tesla anticipates a good shot of being profitable and generating free cash flow nonetheless. If such a recession does come, Elon plans to manage the business adequately through frugality.
- Elon continued to refer to Tesla’s relevance in regard to the acceleration of sustainable energy, which is absolutely fundamental due to its importance for humanity.
Yes, I realize that Tesla stock was off a bit at the beginning of January, partially due to total sales numbers not being what some shareholders expected and partly due to the 50% cut in the federal tax credit for buying a Tesla. But the Tesla board is more robust than ever, with the addition of 2 veteran business people: Oracle founder Larry Ellison and Walgreens’ executive vice-president and global chief human resources officer Kathleen Wilson-Thompson. And lots of investor advisors are telling their clients that they believe Tesla is on track to post one of the market’s most robust year-over-year earnings increases in 2019.
Like many others, I will likely add to my shares of the company over time as I have more free capital to invest.
After all, Tesla is on the frontlines of climate action. One of the best things I can do for the environment is support the company. As more people end up buying a share of Tesla, or 2+, we can show how are investing in the company as another way to do our part in climate action. I do intend to stick with the stock through most anything, because I see its survival and growth as critical to getting the climate under control. This is a narrative that we should see playing out more and more, which makes Tesla stock a rather unique case.
I feel that Tesla will continue to see massive sales growth in the coming years, as Teslas become more common on the streets around us. As other people outside the sustainability community begin to gain awareness as to the role Tesla has taken in the push toward renewable energy, and as more people start to recognize Teslas in their own neighborhoods, the stock will certainly rise in value.
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