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Tesla will also need to raise cash. Look at accounts payable.
by RayVR 9y ago
Tesla will also need to raise cash. Look at accounts payable.
- fancyfacebook 9y agoTheir bond prices are plummeting on this earnings release. The rope may be running out.
- paulpauper 9y agothen the stock should be at $3 instead of $300 if insolvency is such an issue. obviously there is more than meets the eye here. or this is the short of the decade, more than even 2008.
- Hypx 9y agoQuite a few short sellers are making that very case. In fact, one of them said something to the effect that every shorter seller should short Tesla before any shorting other company.
- JumpCrisscross 9y agoIn my general experience, bond traders tend to be a savvier (if more jittery) lot than stock buyers.
- tomatocracy 9y agoWhat's interesting is that at the level of rating that Tesla has, most bond investors are active traders of one form or another rather than "buy and hold" investors. The most common strategy is to look for credit migration (ie buy the bond when it's B-, sell it when it relatively quickly moves up to BB and benefit from the capital appreciation as the yield or spread drops in consequence). A lot of them are 2+20 hedge funds. The people who play in that market are all professional investors and if they play in enough size they have good access to management. So yes, they are probably more savvy than the average equity investor; the bonds falling doesn't mean they think a default is neccessarily on the horizon, just that a ratings upgrade is not (and potentially also that the company will come back for more money sooner rather than later, as that implies more supply vs demand which may not scale equally). This would all seem to make a good case for the equity being overpriced, but to short the equity you need a conviction that the rest of the market will realise this sooner rather than later.
- netsharc 9y agoSo, has any car company called Elon for a buyout?