Let's talk about how Tesla stock is getting absolutely merked right now. The Tldr is they just reported their earnings. they were not so. Bueno and then on the earnings call things got even worse.

That's why the stock is at least at the point that I'm filming this down over 9% There's a couple interesting reactions to this. Some people on Wall Street have this type of an opinion. This is from Dan IES a very respected analyst who's been tracking the tech sector forever. We were dead wrong expecting Musk and the team to step up like adults in the room and give a strategic and financial overview of the ongoing price Cuts margin structure and fluctuating demand.

Instead, in all caps, we got a highle view and another train rck conference call from the street price. Target 35 Obviously not happy. uh if I believe Tesla if you look at the last eight earnings call not I believe I Know this is factually accurate. they've actually missed on six.

so in terms of odds, it's not so good if you look at the last four. Now the last last four earnings they've all been Gap Downs at the next Market open relative to the close so the earnings trend has not been so good. Uh, overall I Just want to be clear, like I'm still bullish in the longterm on the stock. but some of these conference calls they like very very much anger.

Wall Street So that's more of the bearer side and I understand why that's happening a lot of people I suppose want like a a a bit more of just like confidence in where their money is being invested. but another part of Fin Twit is actually reacting the way that I guess Elon himself years ago said people should be reacting. Give this a listen if you see people panicking. Then instead of saying oh man my Stock's gone down, there's a buying opportunity I think this personally will lead into being a buying opportunity I would more than happily buy the dip on this I just want to make sure it's the appropriate dip.

I'm not just going to arbitrarily try to catch a falling knife right now, but before we get into the exact details of the earnings I Want to hear from all of you: are you going to buy the dip or are you like, uh-uh more pains coming I'm very curious where the full audience is at, so let me know. But anyway, to get into the actual what happened from more of a quantitative standpoint: Tesla's shares Dro 8% after company warns of slowdown in 2024. Now to give you a bit more information there. the earnings per share came in at 71 cents.

The expectation was 73. The free cash flow came in at 2.06 billion. The expectation was 1. 4 5 billion.

The gross margin came in at 17.6% The expectation was 18.1 We're actually seeing the gross margin continue to drop in, drop and drop. and that's most likely because of the price Cuts as we've seen a ton of price cuts for Tesla Obviously, that's going to be eating into the margins. They did not give a production guidance for the upcoming year and you could say the overall Vibe of it was that it seems to be like the companies in between two waves of demand. It's like in that awkward Lull in the middle right now.

And another thing that you could safely take away from this entire call is the fact that clearly clearly Tesla is a company that is highly impacted by interest rates as inflation goes up as the FED is fighting inflation, as the FED fund rate continues higher and higher and higher, we are seeing Tesla get destroyed by it. Uh, so it would arguably be safe to say like logically if we like well, okay, if as the interest rates are going up, if that's painful for Tesla when they start coming undone, especially if it hits another technical stride in just like what it's offering to the public, that could be very, very good for the stock, so just wanted to kind of share that. but nonetheless, just obviously. Wall Street The analyst: I'm not talking about the retail generic support of Elon but I'm talking about actual Wall Street You can see how many price Cuts there are.

It's down right now and right now. What do we have? KGI I mean from 309 to 213? 255 to 220 250 to 225 300 to 297, 310 to 270 229 to 225 223 to 200 255 to 224 So pretty much every major analyst who people pay attention to and please take that with a grain of salt, like they're as wrong as they are right? like I just want to throw that out there. their odds are about 50/50 But my point is is, you see the general sentiment of every analyst cut their price Target Musk fails to convince Tesla investor to overlook slowdown, so on one side of it you have just what's going on with the Vehicles the production, What's going on with the gigafactories? What's going on with NextGen all that stuff that's like just pure business. On the other side, we had a bit of a social issue with Elon Remember recently how it came out.

he owns 133% of the company and he was basically saying hey, if we're going down this path of AI and AI development I want more I want 25% and all of media seem to attack him, they're like w you're so greedy, why would you want more and he clarified on the call he's like actually I don't really care about the financial side I want dual class voting He wants more voting power so not not necessarily more financial investment in the company. It's not like he's saying hey d double how much Equity I have he, if anything, would be more happy with doubling the voting power of His current shair So that was discussed a little bit and I think that type of narrative like kind of calmed down cuz Walshire really came at him for it. So that's one thing. obviously other things, it's just Elon Musk Every single day he's in the news a lot of people questioning of like how much time does he have is he dedicating too much time to Twitter AKA that type of stuff.

Um, but if you've listened to any of these calls, it just seems like they're so much more negative and awkward than like you would ever want them to be. It's strange. but anyway, this is a clip from Bloomberg No delivery forecast. But let's start off with something that Ross Gerber was telling us here on the program earlier in the session here that he was really looking closely at those gross margin numbers 17.6% and when you adjust here for those regulatory credits 17.2 Remember, the expectation was 18 because motive gross margin X those credit slightly above what were muted expectations Tesla still has industry-leading margins for make electric vehicles.

You know, if you strip out uh, Z and you strip out uh, the benefit of software, they still kind of lead in this space. But in the final 3 months of 2023, discounting price Cuts using that lever in both directions was a factor along with despite it being a record quarter in terms of sales. uh, you know, an impact on the bottom line, which they they've kind of stayed the course on I Think it's interesting too when we talk about the gross margins holding up. Also, the free cash flow number came in well above estimates more than2 billion.

the street was only for one and a half. here. is that kind of a oneof here? Or is there a trend line that we should be paying attention to? Well, they're being efficient at a time where they're trying to ramp up production of cyber Tru which is a new model. Uh, you have to spend to bring new products online because of the time it takes to staff up and Tool up new assembly lines and the Investments that are needed for that.

um, at the same time as their profits taking a hit from the macro environment that we're in. but also first real Financial re read since Reed we've had since Zack Kirkon left as CFO and Zack was a very good manager of the bottom line and very good manager of Tesla's cash position. His departure doesn't seem to have impacted that Trend I Want to go to something that Tesla said which makes it really difficult to understand what's going on, which is that uh, volume growth will slow. Notably, that's pretty vague and we know that uh, for 2023, they delivered a record.

What she's referring to here is they gave no production guidance for 2024. They just said they expect it to slow down, but they didn't really give an indication of like the magnitude of the Slowdown. So the fact that they're not really ascribing a certain like quantitative measure to it I think is freaking out some investors, especially in the short term. They're like, what do you mean slow down like why are you not telling us your expectation of how much of a Slowdown That's what she's referring to 1.8 million vehicles and a lot of analysts were anticip ating something in the neighborhood of 2.2 million vehicles for this year.

What does it mean when Tesla has talked so much about a 50% um, annual growth rate in in deliveries? What's critically important to state is that that 50% Kga, which goes back to early 2021 starting from the end of the 2020 Financial year related to production. So what they're saying on a compound average annual growth basis is that they would increase their production capacity and the number of vehicles they built by 50% They built more than 1 8 million in 2023. Had they maintained that 50% Kga, they would have been on track to build 2.5 million in 20124. But they're saying the opposite: A they're not giving us formal guidance.

they've omitted that from the volume the the graph in the deck titled volume. But what they're saying is that while they're ramping up their first Gen models Y and three, they also have imminent plans to bring on this next Gen model that we have few details about which will be built in. Texas Um, and for that reason, they're guiding us to substantially lower growth. But that growth again is on a compound basis and it's based on production, not delivery.

But you can extrapolate out right? And if they build less cars, they have fewer to deliver to customers. Just to play Devil's Advocate Here, they're talking about like production and cost and all that production cost actually went down 3.2% So I think right now the base model to create it, it's costing them about 36k. We're seeing a drop. It might relate to the fact that Lithium as a commodity is actually Dro as well.

Uh, so like I Don't think the crazy media Narrative of being absurdly bearish is fully accurate right now I Don't think that's completely fair. but I Also, don't think this idea of like oh, I'm just going to catch the falling knife whenever Tesla dips like I should buy it like I think the truth is somewhere in the middle I'm looking to buy the dip I'm not going to catch the falling knife I'm going to wait to see how things play out because obviously Tesla clearly is an interest rate sensitive company. Just to put this in a bit of perspective, because I think there's going to be a lot of Doomsday in the short term I Just want to remind everyone that Tesla company TSLA Let's get some actual facts right here. Uh, it had $15 billion in net income in 2023.

That's absolutely crazy. Uh, right here the Model Y became the bestselling vehicle in the world. also kind of crazy. And then they also have $29.1 billion in cash, $29.1 billion in cash, $15 billion in net income, and their vehicle the Model Y the best selling vehicle in the entire world.

So just a little bit there of like if you're an active Trader hey play the current Trend But for someone who's an investor I think it's kind of important sometimes to take a step back and understand the big picture and then also final thing, just for those of you interested in the world of crypto, Tesla's Bitcoin Holdings remained unchanged in Q4 So they are continuing to Diamond hand their old digital gold the old BTC holding. So that's what's going on with Tesla and specifically Bitcoin So as I alluded to before I want to know if you buying here, you're waiting for me I Don't think my long-term projection on Tesla has really changed at all. and if anything, I'm going to be patient, take a step back and kind of wait for that sniper s opportunity to get some more shares.