TSLA Crashes 9%
We can kinda feel the frustration from Elon Musk… he recently threatened to fire those who refused to go back to the office and today he got exposed on ordering the cutting of 10% headcount... the “bad feeling of the economy” is an easy poker read in my view..
Q2 numbers will be very ugly for TSLA.. and Elon Musk will blame it on the economy… be it the China lock downs or the US slowing down… its never his fault of course… but when a tech giant like Tesla announces a downsizing it drags the entire index down for sure
TSLA was the fastest growing big tech… it was expected to be forever growing at 50%… that’s how the newbies key their DCF discounted cash flow model and project the insane growth ahead for a fair value of $2000, $3000 or even $4000.. just name it… that’s why I don’t use DCF at all… just like an experienced Butcher doesn’t need a Ruler or Weighting machine… he just takes up chopper and makes he best estimates with his feel.
In business school restructuring, cost cutting, downsizing or what ever you call it.. it simply means there will be a contraction ahead… earnings will be falling and cost has to be controlled…
TSLA was hyper aggressive during the bull market as they will have 2 more factories coming online… but the cold hard truth is that they cannot run the factories at full capacity… the raw materials now are sky high in price.. its a pure burn of money to produce new EVs.. all of TSLA factories are loss making… probably only the Shanghai factory is profitable