Originally Posted by mispoken

As a personal preference, I don’t use accountants to guide my investing.



As for burning through cash; if that’s a concern at this phase in their growth, consider they expect to be FCF positive for all of 2020. Think about how quickly they came from their nearly fatal balance sheet to where they are now. They’re just getting started.



As for the reason for the cash burn; look at where that cash is going....the development of the S, X, 3, Y and Cybertruck? Battery development? Built out of

factories (both for autos and batteries)? Build out of supercharger network? Build out of mobile

support fleet? Self driving software? Software beyond self driving? Build out of salesforce?



They’re investing, it’s not as if Elon is just taking this cash and buying pot :-)



We are in a new era of companies; I’m not sure if I’ve said it yet (haha) but traditional metrics used by academia and talking heads are utterly useless.



Look at the gross margins of these SaaS companies. Who's had those types of margins

in the past? Nobody.



Look at how easy it is to scale now - compared to the past. Takes very little capital and very few boots on the ground. Was it like that in the past where everything was physical?



Look at subscriptions? That revenue and whatever you retain largely goes right to the bottom line. And it is repeatable.



With Tesla, what is the #1 car company, the #1 power company and tons of subscription possibilities (self driving taxi fleet, software updates, etc....) worth? Much more than looking at historical data ratios. It will take a lot to get there, but I can see that path.



What is Fiat-Chrysler spending their FCF on? Advertising? Auto manufactures as they exist are dead.



Keep the thoughts rolling! Lots of good things to reflect on in this thread. Ultimately we all want the same thing: $$$$$$$$ :-)

Originally Posted by TegridyFarms

Here’s some advice. Since I’ve mentioned RMG in this thread a few times I will take you through what I do in my due diligence phase.
1. Find a company/industry/sector that I like.
2. Learn about the components of that sector or industry. In other words—what are the driving factors behind the successful companies and products in the industry.
3. Find the best in breed in that industry or sector.
4. I have an account on Stocktwits (free) and sometimes I will scour their message boards there. A lot of garbage on that app, but there is also some good info/perspective.
5. Invest.

The is purely an example of my strategy. Say you have $10,000. Don’t shoot your wad all at once. Take DAL for example. On profit sharing day let’s say you had $10,000 to invest in DAL. If it were me and I wanted to invest in an airline I would have invested $5,000 of it on that day. Owning a whopping 83 shares for $5,000.

Then literally one week after I started that position the bottom fell out. 2-24-20 that was $45.03 at its low. Not a good look in my portfolio. But you realize the environment. Panic selling. The market. Pandemic. Then you get excited because there is starting to be some major value here. Then on March 30th you see $22 and you know that is a sale price. So you buy. $2500 worth. 113 shares + your original 83 = 196 shares.

Then on May 11th you buy your last $2500 worth at $19. 131 shares. Add this up to your already 196 shares and you have 327 shares of DAL with an average cost of $30.58.

In this example you just went to the depths of hell and back. But your strategy which mirrors Tegridys strategy is to be disciplined, split up investments leaving yourself the opportunity to average up—or average down. If you’re consistent and disciplined you can make even a bad situation like this example work out okay. Buying at the high, buying more on a dip, and buying the last allotment on another dip.

$10,000 invested in DAL. $30.58 average. 327 shares.

As of 12/18/20 at close—DAL is $40.68 and now you can start thinking about your exit strategy! Your $10,000 is $13,302.

So having said that I always start off with investor presentations. Read, educate, decipher, dig, and formulate an opinion. Good luck deltoids. Example: https://romeopower.com/RomeoPowerInvestorPresentation_November2020.pdf

Originally Posted by TegridyFarms

Here’s some advice. Since I’ve mentioned RMG in this thread a few times I will take you through what I do in my due diligence phase.
1. Find a company/industry/sector that I like.
2. Learn about the components of that sector or industry. In other words—what are the driving factors behind the successful companies and products in the industry.
3. Find the best in breed in that industry or sector.
4. I have an account on Stocktwits (free) and sometimes I will scour their message boards there. A lot of garbage on that app, but there is also some good info/perspective.
5. Invest.

Here is an example of my investing strategy. Say you have $10,000. Don’t shoot your wad all at once. Take DAL for example. On profit sharing day let’s say you had $10,000 to invest in DAL. If it were me and I wanted to invest in an airline I would have invested $5,000 of it on that day. Owning a whopping 83 shares for $5,000.

Then literally one week after I started that position the bottom fell out. 2-24-20 that was $45.03 at its low. Not a good look in my portfolio. But you realize the environment. Panic selling. The market. Pandemic. Then you get excited because there is starting to be some major value here but you need to wait until this thing finds support and isn’t in a total free fall. Then on March 30th you see $22 and you know that is a sale price. So you buy. $2500 worth. 113 shares + your original 83 = 196 shares.

Then on May 11th you buy your last $2500 worth at $19. 131 shares. Add this up to your already 196 shares and you have 327 shares of DAL with an average cost of $30.58.

In this example you just went to the depths of hell and back. But your strategy which mirrors Tegridys strategy is to be disciplined, split up investments leaving yourself the opportunity to average up—or average down. If you’re consistent and disciplined you can make even a bad situation like this example work out okay. Buying at the high, buying more on a dip, and buying the last allotment on another dip.

$10,000 invested in DAL. $30.58 average. 327 shares.

As of 12/18/20 at close—DAL is $40.68 and now you can start thinking about your exit strategy! Your $10,000 is $13,302.

So having said that I always start off with investor presentations. Read, educate, decipher, dig, and formulate an opinion. Good luck deltoids. Example: https://romeopower.com/RomeoPowerInv...vember2020.pdf

Originally Posted by Trip7

You can say traditional metrics are out of the window, but at the end of the day the basic principle of investing remains forever. When placing their capital with a company, an investor is buying a piece of a company and the goal is to get a return on their investment.

Right now when you buy a piece of Tesla'a business without growth you will get your money back in 358 years based on current earning(FCAU 8.3 yrs for comparison). Moreover, the intrinsic value of a stock is it's future free cash flows discounted to the present value. Right now Tesla is priced as if 90% of the world's cars will be Tesla and then some to achieve the required cashflow. Will Tesla out innovate every car company in the world for the next 10 years and have monopoly status in the auto industry? All self driving cars will be Tesla? Everyone's home will be powered by Tesla? All cars will have Tesla battery technology? There are some pretty bold bets given the current price

I'm not saying Tesla won't be a successful company. I think it will be. Do I think 10 years from now Telsa investors will make any money if they buy today and hold? Absolutely not. Right now successful investing in TSLA is based on the greater fool theory. Eventually the price will become so absurd there won't be any fools left to trade to. On that day, I wouldn't want to be stuck holding the bag

Sent from my SM-N986U using Tapatalk

Originally Posted by Trip7

You can say traditional metrics are out of the window, but at the end of the day the basic principle of investing remains forever. When placing their capital with a company, an investor is buying a piece of a company and the goal is to get a return on their investment.

Right now when you buy a piece of Tesla'a business without growth you will get your money back in 358 years based on current earning(FCAU 8.3 yrs for comparison). Moreover, the intrinsic value of a stock is it's future free cash flows discounted to the present value. Right now Tesla is priced as if 90% of the world's cars will be Tesla and then some to achieve the required cashflow. Will Tesla out innovate every car company in the world for the next 10 years and have monopoly status in the auto industry? All self driving cars will be Tesla? Everyone's home will be powered by Tesla? All cars will have Tesla battery technology? There are some pretty bold bets given the current price

I'm not saying Tesla won't be a successful company. I think it will be. Do I think 10 years from now Telsa investors will make any money if they buy today and hold? Absolutely not. Right now successful investing in TSLA is based on the greater fool theory. Eventually the price will become so absurd there won't be any fools left to trade to. On that day, I wouldn't want to be stuck holding the bag

Sent from my SM-N986U using Tapatalk

Originally Posted by GogglesPisano

Good advice. Thanks.

Originally Posted by TegridyFarms

I’ll respectfully disagree. https://www.computerworld.com/articl...s-history.html

I remember when AMZN has its first full profitable year. I spent an entire semester of college in business school discussing AMZN vs WMT. Logistics. Balance sheets. Supply. Demand. Everything. Amazon would never ever ever ever exceed WMT. AMZN was around $45-50 at that time. We all had the same consensus. I watched for two years using the same little tools and everything you had in your post. Amazon was over priced. Revenue wasn’t enough, wasn’t sustainable, etc.

That was at $50-200 a share. Now $3,229 a share. Insane.

Same concept with Netflix. The biggest effing fail of my life was listening to some zacks or morning star garbage about how a company that mailed DVDs was overvalued at $40.

Not even a decade later my small investment would be worth $600,000 had I kept that money in NFLX.

Bottom line is—do your own due diligence and look at the future, study a company, and know the financials behind what they’re doing. Don’t give a rip what some widget on a website says about a stocks share price.

Trip 7–I have TSLA. I had 68 shares. Then reverse split this summer announced. 5:1. $17,700 is what I paid for that. That investment is now worth a small house.

Same with AAPL. That thought process that you presented isn’t a blanket approach.

Originally Posted by Seneca Pilot

I wouldn't risk my retirement account on any put plays, especially naked puts. Covered calls would be my retirement play. Covered calls can really juice up the returns.

Naked options are for play money.

Ask him:
Hedge Fund manager James Cordier apologizes after losing almost all of his clients money - YouTube

Or her:
Karen The Supertrader from Tastytrade: Is Karen Bruton the Supertrader a FRAUD? - YouTube

Originally Posted by JamesBond

I've made some very real money with them. They aren't as risky as most think.