High Conviction Concentrated Growth Investing, Fallacy Alarm

Fallacy Alarm

High Conviction Concentrated Growth Investing

High conviction concentrated growth investing. Blends single stock, macro and thematic research into powerful long and short ideas. I am convinced that a robust and comprehensive investment process requires macro and micro considerations. And it requires a deep understanding what you are looking for and what you are invested in. Digitization has changed the dynamics both how businesses operate and how investors compete for returns. Ideas can scale much faster and fail much faster than before. The biggest value creation happens before it can be spotted in financial statements. As a result, my approach can be best summarized as high conviction, high concentration growth investing, embedded into a macro framework built on the realization that our current demographic set-up, monetary paradigm and innovation cycle will likely deliver a strong decade for nominal and real returns of productive assets.

Equity Bottom-Up

<ul><li>For years, the company’s execution in the automotive hardware business has been disappointing.</li><li>The staler the product line-up got, the more margins got squeezed and growth expectations faltered.</li><li>This has put the FSD optionality front and center in the Tesla bull case. So much, that I had previously estimated that it commands north of 70% of the market capitalization.</li></ul>

For years, the company’s execution in the automotive hardware business has been disappointing.The staler the product line-up got, the more margins got squeezed and growth expectations faltered.This has put the FSD optionality front and center in the Tesla bull case. So much, that I had previously estimated that it commands north of 70% of the market capitalization.

The Most Surprising Thing About Tesla's 3Q24

<ul><li>Elon has given up on his ambitious targets. Or he has never seriously pursued them.</li><li>Tesla’s investor event “We, Robot” was nothing more than a theme park for adults who were there to indulge into an illusion for a night.</li><li>Why would they conduct such a ridiculous event that suggests that they have nothing up their sleeves that can create tens of billions of dollars of AI revenue soon? </li></ul>

Elon has given up on his ambitious targets. Or he has never seriously pursued them.Tesla’s investor event “We, Robot” was nothing more than a theme park for adults who were there to indulge into an illusion for a night.Why would they conduct such a ridiculous event that suggests that they have nothing up their sleeves that can create tens of billions of dollars of AI revenue soon? 

External reports (aggregated public sources), Value Investors Club

Value Investors Club

External reports (aggregated public sources)

<ul><li>Tesla is a polarizing company with both enthusiastic supporters and skeptical critics.</li><li>The company has the potential to become the most valuable in the world if it solves autonomous transportation.</li><li>The debate around Tesla is focused on its Full Self Driving software, which has recently transitioned to a neural net architecture and is best experienced firsthand at a Tesla delivery center.</li></ul>This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.

Tesla is a polarizing company with both enthusiastic supporters and skeptical critics.The company has the potential to become the most valuable in the world if it solves autonomous transportation.The debate around Tesla is focused on its Full Self Driving software, which has recently transitioned to a neural net architecture and is best experienced firsthand at a Tesla delivery center.This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.

Research from Value Investing, Value Investing

Value Investing

Research from Value Investing

I am a value investor. "Value", as defined in Value Investing, is simply the act of buying something for less than its worth. I treat my equity investment as a loan to the business - where the priority is to get back my principal in full, rather than achieving maximum yield. I consider my equity investment as a slightly higher risk loan extended to the business with slightly more accommodative loan covenants - hence justifying a slightly higher yield. While I identify as a value investor and cover all stocks and macro topics indiscriminately, most of my research will have an ASEAN bent as that’s where I’m geographically located.

<ul><li>Takeaways: Biden plans to quadruple US/EU tariffs on Chinese EV imports.</li><li>This will further defend TSLA’s domestic beachhead: 1) 50% EV market share in the USA (No. 2: Ford 7% ) + 2) huge headstart over domestic auto incumbents in assembly line processes (Gigapress) &amp; high manufacturing concentration .</li><li>Together, this should result in superior economies of scale which translates into lower unit costs — increasingly important in a commoditizing US EV sector.</li></ul>

Takeaways: Biden plans to quadruple US/EU tariffs on Chinese EV imports.This will further defend TSLA’s domestic beachhead: 1) 50% EV market share in the USA (No. 2: Ford 7% ) + 2) huge headstart over domestic auto incumbents in assembly line processes (Gigapress) &amp; high manufacturing concentration .Together, this should result in superior economies of scale which translates into lower unit costs — increasingly important in a commoditizing US EV sector.

Articles from Caixin Global, Caixin Global

Caixin Global

Articles from Caixin Global

Caixin is a media group dedicated to providing financial and business news through periodicals, online content, mobile apps, conferences, books and TV/video programs. Caixin aims to blaze a trail that helps traditional media prosper in the new media age through integrated multimedia platforms.

News from Caixin

<ul><li>Tesla Inc. will increase the price of its popular Model Y crossover by 5,000 yuan ($694) in China, a move that offers rivals a temporary reprieve as a raging price war engulfs the world's largest auto market.</li><li>The price rise on China-made Model Y vehicles will start on April 1, Tesla confirmed with Caixin Wednesday. Meanwhile, some of the extras offered by Tesla to its Chinese customers, including an 8,000-yuan insurance subsidy, will expire on March 31.</li><li>Tesla previously announced a price increase of $1,000 for the Model Y in the United States and 2,000 euros ($2,542) in Europe.</li></ul>

Tesla Inc. will increase the price of its popular Model Y crossover by 5,000 yuan ($694) in China, a move that offers rivals a temporary reprieve as a raging price war engulfs the world's largest auto market.The price rise on China-made Model Y vehicles will start on April 1, Tesla confirmed with Caixin Wednesday. Meanwhile, some of the extras offered by Tesla to its Chinese customers, including an 8,000-yuan insurance subsidy, will expire on March 31.Tesla previously announced a price increase of $1,000 for the Model Y in the United States and 2,000 euros ($2,542) in Europe.

Tesla Increases Price of Model Y in China in Sign That Price War Is Easing 

United States

Tesla Inc. operates as a multinational automotive and clean energy company. The Company designs and manufactures electric vehicles, battery energy storage from home to grid-scale, solar panels and solar roof tiles, and related products and services. Tesla owns its sales and service network and sells electric power train components to other automobile manufacturers.

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Tesla (TSLA US)

The Most Surprising Thing About Tesla's 3Q24

For years, the company’s execution in the automotive hardware business has been disappointing. The staler the product line-up got, the more margins...

Fallacy Alarm

Tesla: The Disney World for grown-ups

Tesla’s investor event “We, Robot” was nothing more than a theme park for adults who were there to indulge into an illusion for a night.

Fallacy Alarm

Tesla Inc (TSLA) - Tuesday, Apr 30, 2024

Tesla is a controversial company with strong believers and skeptics, with the possibility of becoming the most valuable company in the world if it...

Value Investors Club

TSLA: Chinese EV Tariffs?＄＄＄

Takeaways: Biden plans to quadruple US/EU tariffs on Chinese EV imports. This will further defend TSLA’s domestic beachhead: 1) 50% EV market share...

Value Investing

Tesla Increases Price of Model Y in China in Sign That Price War Is Easing

Tesla Inc. will increase the price of its popular Model Y crossover by 5,000 yuan ($694) in China, a move that offers rivals a temporary reprieve...

Caixin Global

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