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As someone who was looking into the stock somewhat seriously way back then, I'll offer an alternative story. That was their first "profitable" quarter, for whic

As someone who was looking into the stock somewhat seriously way back then, I'll offer an alternative story. That was their first "profitable" quarter, for which they cashed in a bunch of single-use accounting gimmicks. The part that taught me the most at the time was that they then rapidly leveraged that huge rise to issue debt/equity at the new valuation. That cash infusion all but cemented what otherwise would've been quite temporary. Fascinating stuff.

elsurudo 7y ago
Fascinating. Where can I read more such analysis? About TSLA, but also just in general.
- derivagral 7y ago
  This was homegrown stuff we did; the credit bit is from their 2013 annual[0], under "Revenues -> Automotive Sales". This discusses the start of their credit sales. The 2013 Q1 [1] shows a ~11m net income; later, they discuss credit sales [2]. Then, the market went nuts over >0 net income: this 2013 article [3] seems like a reasonable summary. You can find the reports from ir.teslamotors.com/sec-filings or the SEC's Edgar database. [0] https://ir.teslamotors.com/node/12956/html#tx452995_10 https://ir.teslamotors.com/node/12956/html#tx452995_10 [1] https://ir.teslamotors.com/node/13166/html https://ir.teslamotors.com/node/13166/html [2] During the first quarter of 2013, we recognized $67.9 million in ZEV sales, which contributed to our gross margin. ZEV credit revenue should decline in future quarters relative to our automotive sales as we grow our sales outside the United States and earn fewer credits on the 60 kWh Model S battery variant for those sales that occur in the United States. Other regulatory credit sales recognized during the first quarter of 2013 were $17.1 million. While we will pursue opportunities to monetize ZEV credits we earn from the sales of our vehicles, we do not plan to rely on these sales to be a significant contributor to gross margin, and our business model is not predicated on such ZEV credits." [3] https://www.reuters.com/article/autos-tesla-debt-idUSL2N0DY12C20130517 https://www.reuters.com/article/autos-tesla-debt-idUSL2N0DY1...
WheelsAtLarge 7y ago
You have a good point. Companies often use a stocks run up to issue new stock. Many have all the paperwork done so they are ready to issue the stock in no time once they decide to do it. Tesla needs a lot of capital to produce their cars. I bet we'll be hearing about a new stock issue relatively soon.

elsurudo 7y ago

Fascinating. Where can I read more such analysis? About TSLA, but also just in general.

derivagral 7y ago
This was homegrown stuff we did; the credit bit is from their 2013 annual[0], under "Revenues -> Automotive Sales". This discusses the start of their credit sales. The 2013 Q1 [1] shows a ~11m net income; later, they discuss credit sales [2]. Then, the market went nuts over >0 net income: this 2013 article [3] seems like a reasonable summary. You can find the reports from ir.teslamotors.com/sec-filings or the SEC's Edgar database. [0] https://ir.teslamotors.com/node/12956/html#tx452995_10 https://ir.teslamotors.com/node/12956/html#tx452995_10 [1] https://ir.teslamotors.com/node/13166/html https://ir.teslamotors.com/node/13166/html [2] During the first quarter of 2013, we recognized $67.9 million in ZEV sales, which contributed to our gross margin. ZEV credit revenue should decline in future quarters relative to our automotive sales as we grow our sales outside the United States and earn fewer credits on the 60 kWh Model S battery variant for those sales that occur in the United States. Other regulatory credit sales recognized during the first quarter of 2013 were $17.1 million. While we will pursue opportunities to monetize ZEV credits we earn from the sales of our vehicles, we do not plan to rely on these sales to be a significant contributor to gross margin, and our business model is not predicated on such ZEV credits." [3] https://www.reuters.com/article/autos-tesla-debt-idUSL2N0DY12C20130517 https://www.reuters.com/article/autos-tesla-debt-idUSL2N0DY1...

WheelsAtLarge 7y ago

You have a good point. Companies often use a stocks run up to issue new stock. Many have all the paperwork done so they are ready to issue the stock in no time once they decide to do it. Tesla needs a lot of capital to produce their cars. I bet we'll be hearing about a new stock issue relatively soon.