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How awesome Tesla was in the past and how bear Tesla is today, but whether it is short or long, there are always beneficiaries in the capital market.

Since the end of 2021, Tesla has been in a state of "falling" in the secondary market. At the same time, Tesla's sales volume and stock price have also deviated. Tesla's global sales volume was 1.314 million vehicles in 2022. This is the first time that Tesla's global delivery volume has exceeded one million vehicles. Although it is an achievement of growth, it is still lower than the capital market expectations.

Many friends are more concerned about the future trend of Tesla. Lao Li will talk with you today about what triggered the decline in Tesla's stock price in the past year. Why are there short sellers in the US market? When will Tesla's share price pick up?

The trigger for the fall in share prices Tesla's market capitalization fell by nearly 70% in 2022, and Tesla, the brightest star in the global capital market in the past three years, suffered a Waterloo in 2022.

Although there are many discussions about Tesla in the industry, most of us look for the reasons for the decline in the stock price from the fundamentals of Tesla. In Lao Li's view, from the perspective of capital, corporate fundamentals are not the main trigger for the decline in share prices, but the external environment of capital, the reduction of major shareholders and the decline of market confidence.

Let's talk about the external environment first. Lao Li has always said that there is a serial relationship between the industry and the capital market, and the market value will continue to grow only when the industrial performance and the capital environment are good; the market capitalization of the target enterprises will also fall if the industrial performance of the target enterprise is good and the external environment of the capital is poor. Obviously, Tesla and a group of American technology stocks belong to the latter.

In 2022, technology stocks in the United States are plummeting. In the past year, Apple's market value has shrunk by nearly 30%, Nvidia's market value by 51%, and even traditional Toyota's market value has shrunk by 26%. Of course, Tesla, the most "bubble" and "controversial", fell the most.

Over the past year, there has been serious inflation in the US market, and many technology companies have poor profits, but these companies are often trading at a price-to-earnings ratio of more than 30 times earnings. As the Federal Reserve continues to raise interest rates and interest rates continue to rise, these "high-quality assets" of the past have become "non-performing assets" in the twinkling of an eye, and people have to sell and move assets to safer areas. In the past three years, Tesla's share price has risen the fastest, everyone is making fast money, and it is reasonable to sell.

As CEO and the largest shareholder, Musk's cash intensified the sell-off of Tesla's shares. Musk reduced his Tesla shares many times in 2022, cashing out $8.5 billion, $6.9 billion, $3.95 billion and $3.58 billion in April, August, November and December, respectively, with a cumulative total of $22.93 billion in one year.

Compared with Tesla's market capitalization of nearly $400 billion, Musk's absolute reduction is not high, but its continuous large reduction has brought a sense of mistrust to the market. There are different opinions about the reasons for Musk's reduction, but all of these reasons are disadvantageous to the market capitalization management of Tesla. These rumors include Musk cashing out Tesla shares to Twitter, Musk to give up Tesla and no longer serve as CEO of the company, Musk deliberately lowers the market value of Tesla in order not to attract fame, and so on.

Musk reduced holdings, performance growth slowed, technology stocks overvalued and other factors combined, so that everyone's confidence in Tesla is insufficient. Before 2020, how much is expected to rise when you buy Tesla stock? in 2022, the first thing you think about when you buy Tesla stock is how much more Tesla can fall.

As early as the end of 2021, many domestic US stock analysts pointed out that Tesla and a group of US technology stocks are likely to reprice in 2022, but what everyone did not expect is that Tesla will become a target of public criticism. many media analyze that the decline in Tesla's market value is a fundamental problem, in fact, even if Tesla's sales rise to 2 million in 2022, in such a volatile capital environment. Us management will still sell Tesla shares.

Short sellers still have money to earn Tesla's market value has fallen all the way, long people have lost money, and short sellers have made a lot of money in the past year.

Under the pattern of China's secondary market, everyone is a long mechanism, and the investor relations and regulatory environment in the Chinese market are doomed to be short and can only be long, so once the market enters a bear market, everyone's yield will not be good.

Relatively speaking, the American capital market is relatively mature, although there are many problems in the American short selling mechanism, it is already a relatively mature mechanism. In Lao Li's view, the negative factors such as the deterioration of the external environment, the reduction of Musk's holdings and the weakening of market confidence will not cause the market value to fall by 70%. After all, Tesla is still a trillion-class company with a market capitalization at the end of 2021.

Tesla has always been a stock concerned by short sellers in the US market. From 2018 to the present, American short sellers have been trying to short Tesla. In the confrontation between long and short positions by Tesla in 2019, the short sellers suffered a big defeat, and Tesla's market value further rose. In the short sellers' point of view, the rise means that the "bubble" intensifies. Once the external environment of the market gets worse and Tesla's performance can not be cashed, the short sellers will usher in new opportunities.

Generally speaking, when the market value starts to fall, the market will have a net short share, and when the short positions cover, the market will form a buying buffer, the market value will stabilize briefly, and then the market will fall further.

We see that the market value of Tesla basically showed this rule in 2022. In the first and second quarters of 2022, although the delivery volume of Tesla was OK at that time, the market value continued to decline. Tesla's market value stabilized in the third quarter and collapsed again after the beginning of the fourth quarter.

Some friends of Lao Li's dollar fund said that in the past year, the difference between Tesla's long and short positions was very big. Although the number of institutional investors who were long was much higher than that of short investors, the external environment was too bad. Long investors always had no way to stabilize the market value, and short sellers were actually the most profitable party in this process.

Whether it is the domestic market or the foreign market, another important factor that determines the performance of an enterprise's capital market is CEO. Whether it is Apple, Nvidia, or the traditional company Toyota, its number one leader is mainly "stable".

Iron Man Musk is a radical style, which will also bring a radical style of play. In terms of business operation, Tesla is only one of its business layouts. In addition, Musk began to gradually move from the "scientific and technological aspect" to the "social aspect". Since taking a stake in Twitter, Musk has gained a bigger social voice and revived his Trump account, and some investors have begun to take a new view of Musk.

No matter in the domestic market or foreign market, the relationship among management, enterprises and CEO is not the relationship between growth and decline, but the relationship between strong when strong and weak when weak. When the enterprise and CEO walk on the strong side, the management will give greater support. When the enterprise and CEO are weak or there are huge risks, the capital will often take the lead to trample on it, and the performance of the management will be reflected in the form of enterprise market capitalization.

Obviously, Tesla can not escape the capital environment formed by the US market over the past few decades, which I think is the most direct reason for Tesla's decline.

Does Tesla still have a chance? recently, many friends have been asking, when can I get to the bottom of Tesla? To be honest, it is difficult to judge at present, but it still depends on the general environment. When the US capital environment picks up and Tesla's performance picks up, its market value may rebound, on the contrary, Tesla's market capitalization will not perform very well.

At present, Tesla is still divided between long and short. Tesla, a staunch supporter of investment goddess Mu Tou, recently said again that Tesla's market value will nearly quadruple by 2026, approaching that of Apple. On the other hand, fund managers on Wall Street are talking about preparing for a "cold winter" in 2023, as Tesla must bear the brunt of the Fed's efforts to eliminate inflation and kill the valuations of technology stocks.

In addition to the external environment, the biggest controversy about Tesla in the US market is pricing. Until 2021, the US market has been positioning Tesla as a technology stock, and everyone has been using the pricing method of technology stocks to give Tesla a higher price-to-earnings ratio. But the problem is that Tesla's financial performance in recent years has proved that the company is not a real technology stock-high investment, high production capacity, low rate of return, it is like a manufacturing company.

However, Tesla is obviously different from Volkswagen and Toyota. Its profit margin is much higher than that of traditional manufacturing enterprises, and its free cash flow also has a good performance, so it is unreasonable to use the pricing method of traditional manufacturing enterprises. Lao Li gave it a name called high-tech manufacturing enterprise.

Lao Li believes that whether it is Tesla, China's new power, or traditional electric car companies, everyone can be classified as technology-based manufacturing enterprises. As great changes have taken place in products and services, the profit margin and free cash flow of the electric vehicle industry are higher than those of traditional manufacturing enterprises, but not as good as those of high-tech enterprises. Therefore, the market should give electric vehicle enterprises a reasonable price-earnings ratio between traditional manufacturing enterprises and high-tech enterprises. This means that Tesla's reasonable pricing range should be higher than traditional enterprises, lower than high-tech enterprises, according to the actual performance of the corresponding price-to-earnings ratio, and then get the reasonable market value of the enterprise.

Under this logic, Tesla's performance is particularly important. At present, the Chinese market has the greatest impact on Tesla's sales. Since last year, the domestic electric car market has gradually entered the "volume era". New products of various enterprises emerge one after another, and Tesla's main models Model 3 and Model Y are on the market in 2017 and 2020 respectively, and the product iteration speed is not fast. In addition, Tesla's FSD can not be completely landed in China, which has a great impact on Tesla's business model.

At present, the production capacity of Tesla's Shanghai factory is sufficient, but with the emergence of more public opinion events and continuous price cuts, Tesla's brand effect and influence have been greatly weakened, and the market demand has also been reduced. although some funds predict that Tesla's delivery volume in the first quarter of 2023 will usher in a big explosion, Lao Li still has reservations about its market value.

For the ups and downs of technology stocks like Tesla, it is difficult for retail investors to grasp the exact bottom point. When the external environment is not stable, it is the best way to focus on the domestic market and wait.

This article comes from the official account of Wechat: autocarweekly (ID:autocarweekly)

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