Professional Documents
Culture Documents
Recover Corrupt
Exchange EDB Files
INVEST ELECTRIC CARS ELECTRIC CAR BENEFITS ELECTRIC CAR SALES SOLAR ENERGY ROCKS RSS ADVERTISE PRIVACY POLICY
Back to Top ↑
Tesla’s stock is tumbling in the largest decline in TSLA history, and the media is in a frenzy.
The headlines on Tesla are starting to include the words such as “troubles,” “struggles,” and
even “doomed.” The narrative says Tesla’s demand is falling, its balance sheet is in terrible
shape, and Tesla will run out of cash in 10 months. The narrative also claims that Tesla will
miss expectations in the second quarter, and one analyst says that Tesla might go to
Advertise with CleanTechnica to get your
$10/share from the current $190, which is already down >50% from the highs. However, the
company in front of millions of monthly
data show that none of that is true. Tesla’s orders are at an all-time high in North readers.
America and worldwide, the balance sheet is the strongest it has been in 6 quarters, and
the average 12-month price target among analysts is $276/share, or 46% higher than
today’s price.
CleanTechnica Clothing & Cups
First, we will start with demand and quarterly expectations for vehicle deliveries. I recently
wrote a piece presenting data showing that Tesla’s orders for Model S/3/X are up 25% so
far quarter over quarter worldwide, and Model 3 orders in US and Canada are up 116%
(since publishing, they’re up to 130%) quarter over quarter. Analysts and media personalities
keep claiming Tesla’s demand is soft in recent weeks, while overlooking the hard data
proving that, in fact, demand is rising.
https://cleantechnica.com/2019/05/31/the-media-is-telling-one-story-about-tesla-facts-tell-another/ 1/14
6/1/2019 The Media's Story About Tesla Is Wrong, Facts Tell Another | CleanTechnica
People Repeatedly Claim Tesla Demand Is Falling When Data Shows Tesla’s Demand Is Rising
Top News On CleanTechnica
While these analysts are speaking publicly about soft demand, something strange and
completely contrary is going on with the expectations that those same analysts are setting The Media's Story About Tesla Is
for the second quarter. In a recent conference call with investors, analyst Adam Jonas of Wrong, Facts Tell Another
Morgan Stanley stated that the current “whisper number” for Tesla’s deliveries in the second
Jaguar I-PACE, Audi e-tron,
quarter is “in the mid to upper 70s [thousands]” in terms of deliveries, versus Tesla’s
Mercedes EQC — Electric
guidance for between 90,000 to 100,000 (which no one believed) as well as Elon Musk’s Autobahn Range Disasters
most recent, slightly lower target (from his leaked email) of 90,700.
Chinese Tesla Model 3 Price
Crushes BMW 3 Series &
This whisper number is in line with the public consensus among investors — 82,092. Mercedes C-Class Prices
However, the analyst consensus that the media uses as a benchmark for Tesla to beat or
miss, called FactSet, has an estimate of 92,000 deliveries. This FactSet number seems Tesla's Integrated Dash Camera
Saves Hit & Run Victim
artificially high and designed so that if Tesla pulls off a delivery hell miracle and delivers its
new target of 90,700 vehicles in the second quarter, it will still be considered “missing
Tesla Is Producing Unicorns
expectations.” Why? Because it is 1.5% lower than the benchmark the media uses despite
being >13% higher than the “whisper number” and 10.5% higher than general investors’
expectations. Rumor Mill Goes Into Overdrive
— GM/Ford Merger On The
Horizon? And What About Tesla?
Next, let us look at the balance sheet and Tesla’s cash position. First, a brief explanation of
what a balance sheet tells us: It is a document that every company has in its quarterly report
that shows the value of all its assets and all its liabilities/debts, and the total amount by
which assets exceed liabilities/debts is called equity. Cash is usually the first line in the
balance sheet as an asset and is the only asset that can be immediately used to pay for
things, thus making it very important.
Elon Musk recently sent a misinterpreted email to employees that was leaked to the
press, in which he made a hypothetical example to illustrate that the new amount of cash
that was just raised in early May was not as large an amount as it seems. The example was
that if Tesla kept losing money at the same rate as in the first quarter ($700 million), then it
would effectively “lose” all the money it had just raised in only 10 months. This was clearly
an illustrative hypothetical because the calculation wasn’t even technically correct. He was
citing the net loss on the income statement, which includes non-cash expenses such as
stock-based compensation and depreciation that have no direct effect on Tesla’s cash
balance. Moreover, the net loss also excludes some cash items such as investments that
Advertisement
https://cleantechnica.com/2019/05/31/the-media-is-telling-one-story-about-tesla-facts-tell-another/ 2/14
6/1/2019 The Media's Story About Tesla Is Wrong, Facts Tell Another | CleanTechnica
the company makes and any cash raised or paid back as part of financing with banks. You
can read more about this email here:
Elon Musk
@elonmusk
Yup
4,936 2:43 AM - May 28, 2019
The media took this email to mean that Elon Musk was saying that Tesla would run out of
cash in 10 months and that the overall balance sheet is unhealthy. Tesla had $2.2 billion in
cash before the recent raise of $2.4 billion. Musk’s hypothetical was referring ONLY to the
recently raised $2.4 billion. The media suggested that it was Tesla’s entire cash position and
that Tesla would actually run out of “cash” in 10 months.
Advertisement
Moreover, the first quarter was an anomaly in many respects, and thus the same level of
cash burn will not recur. When you exclude one-time items such as a $920 million debt
repayment Tesla made in Q1, a $188 million one time charge for restructuring and inventory
price changes, and the $809 million increase in inventory as Tesla refilled the in-transit
pipeline that was drained in Q4, then Tesla actually gained >$300 million in cash rather than
losing $1.6 billion. All these one-time items will not recur in Q2, and deliveries will be
significantly higher in even the most pessimistic of scenarios. So, while the media reports
Tesla is running out of cash, the reality is that Tesla will likely post positive cash flows in the
second quarter. It is 100% certain that Tesla will not run out of cash in 10 months.
As for the overall balance sheet, which some media personalities on CNBC keep claiming
is in dire condition, the reality is that Tesla’s balance sheet is healthy. The metrics
demonstrating this are the debt-to-equity ratio (debt divided by the amount by which assets
exceed liabilities; lower is better) and the current ratio (assets that are or will become cash
over the next year divided by liabilities/debts that are due in the next year; higher is better
and >1 is healthy liquidity). Both metrics show Tesla’s balance sheet is the healthiest it has
been in 6 quarters, after Tesla’s most recent cash raise. This again directly contradicts what
the media is reporting.
Follow CleanTechnica
Finally, the last misrepresentation of the Tesla narrative that I will cover is the recent media
coverage of analyst opinions. Two analysts, Morgan Stanley’s Adam Jonas, and Citigroup’s
Itay Michaeli put out research reports with “bear cases” that say Tesla could be worth as little
as $10/share and $36/share, respectively. The articles written about this did not emphasize CleanTechnica
enough nor explain that “bear case” means “most pessimistic” or “worst case” scenarios. 42,251 likes
Nor did the articles put it into perspective that the overall 12-month average price target of
all analysts covering Tesla is $276.56 (46% higher than today’s price).
Like Page Send Message
It is worth noting that there are a ton of interests against Tesla and other electric cars in
general. Other automakers have been dragged kicking and screaming into the yet
unprofitable electric car markets due to intense competition from Tesla, health and
environment regulations, and societal demands. Oil interests, famous for pedaling climate
denialism while their own research shows anthropogenic climate change has been
happening for nearly 50 years, are now focusing their efforts on curbing electric car
sales by spreading misinformation and lobbying against tax credits.
Read & share our new report on "electric car
drivers, what they desire, and what the
Finally, there are loud, outspoken fund managers such as Jim Chanos (who it seems clear demand."
previously manipulated the perceived solvency of Fairfax to drive them out of
business), David Einhorn, and Mark Spiegel (who keeps presenting at conferences that
Tesla is worth $0 and runs a Twitter account bashing Tesla on basically a 24/7 basis) — all
The EV Safety Advantage
of whom are short Tesla. Besides them, there are thousands of people shorting Tesla and
betting against the stock with billions of dollars, who often get their information at dark
corners of the internet, such as $TSLAQ on twitter (a conspiracy theory group that runs on
confirmation bias to spread their thesis that Tesla will go bankrupt). All of these people and
industries rejoice and profit when Tesla fails, and they are known to pressure the media to
cover their negative narratives and pester the SEC with requests to sue Tesla and Elon
Musk.
Here, I presented clear evidence that the media narrative around Tesla is a manufactured
crisis of confidence, and in fact, not a tangible crisis. This is not the first time such a crisis
was manufactured about Tesla, and certainly not the last. Every time such a crisis is
manufactured, it threatens the compensation of hardworking employees at Tesla and can cut
off Tesla’s ability to raise the capital it needs to fund its vision of a sustainable future.
Moreover, some customers might be deceived into believing that Tesla will go out of
business and decide not to purchase Tesla’s products at all. We have heard many such
stories along these lines.
With such large interests against the sustainable future, the incentives to manufacture a
crisis for the company focused on that sustainable future are clear. Anyone who cares about
a sustainable future must educate themselves and others, and, unfortunately, now it is
required to employ a healthy does of skepticism regarding media reporting around
https://cleantechnica.com/2019/05/31/the-media-is-telling-one-story-about-tesla-facts-tell-another/ 4/14
6/1/2019 The Media's Story About Tesla Is Wrong, Facts Tell Another | CleanTechnica
Tesla, and always fact check it. It is of the essence to call disinformation where you see it,
and question the people spreading the it. Complacency could lead to powerful anti-green
interests getting richer and more powerful. Beware of the Tesla smear.
P.S. To those who cover Tesla: Win back trust by paying attention to who your sources are,
and where their interests lie. Do not claim something questionable unequivocally (like the
balance sheet is in meltdown) without at least caveating the statement: the balance sheet is
the best it’s been in a while thanks to the new cash raise and could improve if new cash
flows materialize.
If you have the power, reject the influence of those who deny climate change or try to slow
down its solutions. Finally, do not take the trust of your readers for granted. If you trivially
jeopardize the future of humanity by destabilizing the largest sustainability organization the
world has ever known in the face of catastrophic climate change through questionable
claims, then you’re not “just the messenger” anymore, and you will not be trusted.
Tags: Elon Musk, EV sales, FactSet, stock analysts, Tesla, Tesla analysts, Tesla
financials, Tesla Model 3, Tesla Model S, Tesla Model X, Tesla stock, united states, US
Tesla News
This New $89 Trap Finally Solves The Egypt Mosquito Problem
Electric Mosquito Killer
Don't Eat Turmeric Unless You Know These 7 Things Wind & Solar Prices Beat Fossils
Health & Human Research
LOG IN WITH
OR SIGN UP WITH DISQUS ?
Name
It's a legit Fahrenheit 451 society and living inside 'a bubble' has become a
convenient choice for economically well off Americans who do not wish to see
anything bad or anything change from what they're used to.
21 △ ▽ • Reply • Share ›
To be honest, I can understand this position... I'm kinda the same from a
physical aspect (don't like the gym / making a physical effort - far easier to
just sit on the sofa eating comfort food and getting flabby), so it doesn't
surprise me that some people are the same mentally, consuming the media-
equivalent of junk food....
It's just a shame that they want to pull everyone else down to their level...
whilst I'm happy to sit on the sofa (well, on the computer chair) and get
flabby, I'm more than happy to salute anyone who is willing to exert
themselves... shame the 'mental-flabbies' won't follow suit.
13 △ ▽ • Reply • Share ›
The stock price is not even worth worrying about. It's too much manipulated to be
any kind of indicator for the health of the company itself. Just ignore it.
20 △ ▽ • Reply • Share ›
Boom!
△ ▽ • Reply • Share ›
Yes, would be more fun to write about the cool stuff than the lousy market
manipulation.
△ ▽ • Reply • Share ›
Might it be that there are interests that are now fearful that their industry will
be coming to an end long before they anticipated? Attack Tesla strongly
enough and it might be possible to hold off the inevitable a bit longer and
allow more looting before the collapse.
I'm not saying that is happening, but there certainly is motivation for
someone to mount a propaganda campaign against Tesla.
△ ▽ • Reply • Share ›
Indeed. And we're talking about Tesla! Years of this stuff. But is at an insane
level (again — was like this mid-2018.)
△ ▽ • Reply • Share ›
Some of the legacy players are poorly positioned for the transition to EV's, and are
likely looking at much bolder remedies than they might have considered in the past.
Meanwhile, to secure ownership or control of GF1 would offer a fast elevator ride
right to the very top of the BEV field. Not to mention all the other stunning technical
advances that one would gobble up in a takeover, such as AP and the Maxwell
battery breakthroughs. (And consider just the value of the powerful entre into the
Chinese BEV market, with the very first foreign owned car factory . . .)
https://cleantechnica.com/2019/05/31/the-media-is-telling-one-story-about-tesla-facts-tell-another/ 10/14
6/1/2019 The Media's Story About Tesla Is Wrong, Facts Tell Another | CleanTechnica
People think their ICEV they bought in 2005-2019 that sits in their garage right now
will still be worth money in the next 6 years. Those people should entertain the fact
that ICEV values may drop to almost nothing because many cities are ratcheting up
their emissions standards and may suddenly ban your car.
Those 4,000 pound "cars" will soon be paper weights. Just wait.
8△ ▽ • Reply • Share ›
And as for your second paragraph, I wouldn't quit my day job to become a
market analyst, if I were you. There is no way ICEVs drop in value to $0 (or
anything close to that level) in only 6 years.
Ed • a day ago
Let’s see:
Most envied products
Least environmental impact on the planet
World leading technology
Ever expanding charging network
https://cleantechnica.com/2019/05/31/the-media-is-telling-one-story-about-tesla-facts-tell-another/ 11/14
6/1/2019 The Media's Story About Tesla Is Wrong, Facts Tell Another | CleanTechnica
Ever-expanding charging network
Highest product margins
Growing demand for products
Emboldening cities to restrict ICE vehicles
Reshaping global automotive industry
But:
Steep growth inherently requires much cash
Massive investment needed in batteries, charging networks, new models, capacity,
China, etc.
US laws allow stock manipulators to enrich themselves at the expense of risk-taking
companies.
Stock being driven down sharply.
Apple needs to find a new, large market in which to invest their piles of cash. Is this
the moment for Apple to acquire Tesla? Apple support could accelerate the
transition to clean transport across the globe.
2△ ▽ • Reply • Share ›
https://cleantechnica.com/2019/05/31/the-media-is-telling-one-story-about-tesla-facts-tell-another/ 12/14
6/1/2019 The Media's Story About Tesla Is Wrong, Facts Tell Another | CleanTechnica
Sponsored Links
The five best super cars from the Geneva Motor Show
Square Mile
https://cleantechnica.com/2019/05/31/the-media-is-telling-one-story-about-tesla-facts-tell-another/ 13/14
6/1/2019 The Media's Story About Tesla Is Wrong, Facts Tell Another | CleanTechnica
Inc., its owners, sponsors, affiliates, or
subsidiaries.
Invest Electric Cars Electric Car Benefits Electric Car Sales Solar Energy Rocks RSS Advertise Privacy Policy
Back to Top ↑
:)
https://cleantechnica.com/2019/05/31/the-media-is-telling-one-story-about-tesla-facts-tell-another/ 14/14