Everyone me kevin here. Let's talk tesla because tomorrow is july 20th. Which is is tesla's earnings a day after hour stay tuned. It's going to be but let's talk a little bit of a preview before that so deutsche bank.

Put out a piece a research piece on tesla. And they actually issued a buy rating for tesla. Before earnings. Listen to some of the catalysts that they talk about then we're going to talk about some of the things that i'm finding important regarding tesla.

Some of the things that i'm going to be looking for and of course. We're somewhere here in munich in front of this fancy building. It drove over here for like six and a half hours from dusseldorf and let's just say i'm happy and not to be on the road anymore today. So let's get right into this okay.

So. What do we have here. So. Deutsche.

Bank. Is calling tesla. A buy ahead of earnings and they believe that tesla's a buy because they think. The company is likely to uh end up reporting.

A big beat on margins over what wall street. Expects that's because most of wall street has been expecting a terrible margins for tesla. In q2. Because shanghai has mostly been shut down and as a result of shanghai mostly being shut down.

Which is the most efficient plant that we have operating right now from tesla. The expectations for margin are actually quite low and they believe this sets tesla for a potential big beat. They also believe that tesla's price increases especially the 2 000. Price increase that we had this quarter is definitely going to help ramp up margins again now i'm a little skeptical here.

I've personally been expecting a margin miss and the reason for that is simply. Because shanghai is a better plant. Even though we get model s's and x's and the plaids coming out of fremont and those are helpful. The shanghai plant will cost the labor everything substantially cheaper in shanghai.

Now one of the things that i love about shanghai. Though is the ramp schedule and for the ram schedule. I actually jump over to a barclays report. So we get enthusiasm for a potential margin beat from deutsche bank and we've got a buy rating from deutsche bank.

But when we jump over to the ramp schedule that barclays gives it's kind of interesting they believe that by 2025. We're going to see fremont cap out and pretty much where it is now right around 500 to 550 000. Units. They believe shanghai is going to move from about 775 000.

Units. This. Year to almost a million next. Year and that only capping out around 11.

By about 2025. Germany. They think will ramp from about. 59 000.

Vehicles this year. To 275 000. Next and then 470. 000.

By 2025 and austin. From. 59 000. This year.

To 234 000. Next year. And then of course 420 000. In 2025.

Now this actually creates a little bit of a downside risk in my opinion because even though this forecast sounds nice for ramping those facilities the gigafactory berlin shanghai seeing shanghai's expansion take effect getting that to 11. And then of course austin texas. What are the big issues that we have here is that barclays is only suggesting a growth rate for tesla of 37. In 2023.

18. In 2024 and just nine percent in 2025. Capping them out at two and a half million vehicles. Produced by 2025.

Which is about one and a half million vehicles less that i'm targeting somewhere around four to four and a half million vehicles. This is a little bit of a red flag so while we've got some short term excitement for a potential beat on margin thanks to what. Deutsche bank. Is showing us going into earnings that longer term forecast from barclays.

In my opinion. Not that great for production now. This is where my previous belief about tesla becomes very very important and that is that tesla cannot keep its price up with these kind of ramp rates. We need to be able to have more gigafactories.

So that wall street starts pricing. In that continued 40 to 50 percent. Compounded annual growth at least for the next four to six years that would justify tesla's valuation much better than where we sit now and so that does concern me a little bit that barclays is not at all considering that there will be any other gigafactories between now and 2025. Personally i think that's one of the things that wall street is really missing about tesla.

That what elon musk wants to do is ramp. Berlin and giga texas up as quickly as possible ramping. These and taking these factories from an idea to built within two years to fully ramped within four years total two years and then two years for ram and then copy and pasting that model. Because if we do that then what we could say with tesla is all right let's go into 2023.

When we're doing 250 k. Plus at berlin and giga texas. Now let's get an announcement from tesla. Where in 2023.

We're going to have announcements for let's just say three new gigafactories rather than just uh berlin and tac and texas. We get maybe three new whether that's another one in texas or another one in south america. Or one. The first one in south america.

Let's say maybe one in indonesia. Whatever right now we can really get those wall street ramp rates up so that's something that we really want to see hints of on the tesla earnings call. Though unfortunately. I think now is a little bit early for that so while i'm optimistic that maybe.

Deutsche bank will be right and that will beat on margin with tesla personally i think ah that could be hopium and i don't think we're going to get any kind of real optimism for future ramp ups now other investment analysts are suggesting that tesla is going to do just fine this earnings because they're going to maintain substantial positive cash flow. Although the estimates for this range. We could see a negative billion dollars in cash flow. We could see positive three billion dollars in cash flow.

The estimates are all over the place. The estimates for earnings are anywhere between a buck forty per share to two dollars and ten cents per share. They're absolutely all over the place but clearly in my opinion the big things we're going to be paying attention to first margin second. Do we have any kind of hope for future expansion of gigafactories and how are the ramps going now because the smoother.

The ramps go now which let's be real no ramp goes. Smoothly okay. These factories are under chaos. Until.

They're actually smoothly operating ramps suck uh. Then then the more potential excitement. We can get for future gigas. But i really don't think q2 2022 is the time for any kind of future company expansion plans another thing.

Though that we'll obviously be looking at in the press release as it comes out is any kind of bitcoin impairment. Right now we're expecting somewhere around 400 million dollars in bitcoin impairment. Though that's not a cash flow effect that will be an eps and earnings per share effect. But we won't see that in the free cash flow.

We'll be able to look at the free cash flow number on the cash flow statement and we'll be able to see that okay they have some paper losses and bitcoin that get added back in to free cash flow. Which is important because we want to see tesla's working capital be very very high remember. What elon musk told us in an interview uh with uh with the silicon valley owners club. He told us that ramping factories is like throwing money into a furnace.

It's literally like lighting money on fire. And what's really important about that is that we separate tesla from the notion that it could potentially go bankrupt. Remember we are either in a recession or are going into a recession. Or we're basically going to be teetering next to a recession.

Even bank of america is suggesting that we're probably going to have four quarters of negative gdp growth. Which the fact that we're coming off the sugar high is really no surprise. Anyway that we're gonna have a little bit of a crash. It's not that big of a deal if anything.

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We're going to be releasing more content in august as we'll be back in the office and we'll have our big old studio back so we're excited about that right now obviously we're traveling and so we are still trying to do our best to bring content and value via live streams and of course these public videos and whatever else we can do within answering questions in the courses. So check out those courses linked down below and take advantage of that coupon code so going now back to tesla we've talked about margin. We've talked about ramping. We've talked about bitcoin impairment and free cash flow and expectations very very important in my opinion that tesla does maintain positive free cash flow.

If we end up getting negative free cash flow. We're going to see more of those concerns again that oh no here we go risks of potential tesla bankruptcy you'll get headlines tesla losing this much money in the last quarter. Blah blah blah. And the net and and that's going to raise the specter of questions again of why in 2022 does it seem like at least shout out to troy like on tesla.

This is at troy tess like t e s. L. I k e who does estimates for vehicle deliveries and registrations in both europe and the united states. Why is it that the pace at which we're seeing registrations of american teslas like model 3s and wise why does it seem like that's substantially slowing in 2022.

Relative to other years is tesla maybe not as insulated from recessionary fears as we'd hoped and one of the ways. We're going to kind of get corroboration on that thesis is or or concern. Is guidance from tesla. So is tesla going to maintain what elon musk told us in q1 that hey we might be able to grow at 60.

I hope so. But again opium is not an investing strategy. So we have to be prepared for a potential miss on full year guide. I will tell you though that tesla registrations in europe.

Which again go to uh troy's twitter page here to see it tesla registrations in europe in 2022 are ramping substantially faster than in any year prior going all the way back to 2013 now that could be because now we're manufacturing 3. And why in berlin. But i doubt that that is exactly why we're seeing this boost in registrations. What i actually believe is because we're actually starting to see the development of the tesla supercharger network in europe one of the most frustrating things about having an electric vehicle is not having a large enough supercharger network and it takes time to build the supercharger networks and so this is where i also am going to want to pay attention to what tesla is doing on their next earnings release with the supercharger stations.

How many supercharger stations are we seeing built we had superstar uh super. Superstarter. Supercharger stations in q1 of 2022 of 3724. Which represented a 38 year on year growth.

What i want to see is that number actually go up because i want to see tesla's ideally like best case scenario. Tesla somehow magically pulls off margin whether it's through price increases or whatever then we end up. Seeing positive free cash flow and more rapid deployments of the supercharger network. That is really important for future sales.

And it separates tesla from all the competition so again. We've got super supercharger stations at 3724. I want to see that year over year growth rate. Exceed 38.

Now the comp that we're going to be facing for q2 2021. Is 2966 so just do 2966 times. One point say four uh which let's see four times three would be about 1200. We'd probably that means we'd have to be somewhere around 4 200.

We'd have to be opening somewhere around 500 supercharger stations. That would be a little faster than what we usually do which seems to be around two to 300 supercharger stations. So i might be disappointed there. But we'll see how how close we get and that's just mental math.

There but anyway the next thing that i'm excited about or going to be excited about is solar deployment so we actually had a negative 48 solar deployed growth in q1. It's not uncommon to see a big drop off in q1 usually from q4. But to see a year over year q1 plummet like that i don't know what happened there for in in q1. So.

I'd really like to see solar panel deployment up uh certainly year over year. I mean we've got to be 85 megawatts. We were at 48. Which is poultry in q1.

I don't know what happened there uh. I so i'd like to get a little bit more clarity on the solar ramp. Because uh. Either homeowners have officially started to pull back their spending on investing in their homes.

Which will be a catalyst for end phase stock as well which ran to like 215. I wanted to short it fell to 186. I didn't end up shorting. I just talked about shorting.

It to course members of the course. Member live streams uh and and now. It's already bouncing back to over what two or five two or six or so today uh. Which is remarkable.

It's a great company and i love and face. I just expect that if home appreciation stalls and slows down that people will spend less on solar and certainly spend less on batteries. Remember for these 5k battery packs. You're spending somewhere around 10.

To 15 000. Installed. I think tesla batteries you're spending. 10 000.

On the battery. Plus install 5 grand in the permit and everything. It's expensive to do these batteries and i'm not sure if homeowners right now want to spend money on doing the battery upgrades. And that's where the margin is remember that when it comes to solar the margin is not in the stupid panels.

It's in the inverters whether they're micro inverters or string inverters whatever or the battery. So i should say and the batteries that's where the freaking money is so i do want to see some growth. There as well uh you know i don't expect to see anything exciting out of tesla insurance. Yet.

Although. I will tell you i think the safety score. Feature. That tesla has is is so unique and proprietary and it is something that absolutely uh will be revolutionary in the insurance industry in the future.

But look insurance is one of those products that even though elon musk believes that in the future insurance. Alone could be worth a quarter of the value of the company. I think that is just pie in the sky opium at this point. I think what's more pressing in the near term rather than talking about fsd or insurance or cyber truck.

Time frames or all this other kind of opium crap like roadster time frames semi truck time frames. All that stuff is not going to matter in my opinion in this quarter. I think actually what matters more than all of those things is what ends up happening with twitter now i'm going to make some separate videos on elon musk and twitter. And some of my thoughts.

Especially as we find out what the judge ends up ruling in terms of is elon going to be faced with an expedited trial. In september. Are we going to have a more full fledged exposure of all the bot accounts at twitter. Which will probably uh be more of an extended like one to two year court battle starting uh in 2023 is my guess and then that'll go for a few years.

And it'll just be a long overhang for twitter. It'll be terrible and twitter will probably end up if they go for a long lawsuit. I wouldn't be surprised if twitter ends up caving and we get some kind of negotiated price twitter ends up getting sold to elon musk for substantially less twitter's best case scenario is getting an expedited trial and being done with this which an expedited trial would probably be quite bad for elon musk. But we'll see what happens there again this isn't supposed to be a twitter elon musk video really at this point.

I think elon musk has liquidated what he needs to to do the twitter deal whether it happens or not and i don't know how much of an effect is left for tesla. There although we do expect that if the deal doesn't go through that there should be some residual benefit to tesla stock. As the investor community does seem to believe that elon musk would otherwise be distracted. If he uh.

If he did get involved with uh managing and running twitter. Uh and trying to reform twitter. So anyway. Uh.

Personally optimistic. I am also uh probably going to be selling my model s plaid. And maybe we'll trade that in for an x. We'll see uh you know.

It's one of those weird things where last september. I tweeted. Uh don't buy a tesla. Buy.

Tsla and uh that ended up. Not being the best uh suggestion. Because the cars ended up going up more in value than tesla. Stock hopefully this time though is different because those are after all the safest words in investing this time is different buy tesla stock.

Okay not a recommendation because this video is not financial advice for you. But there is a strong suggestion for you to get educated by the programs on building your wealth link down below especially real estate folks. I think that's our big next opportunity. Most people what they're doing is they're bundling the zero to millionaire real estate.

Investing group with the stocks in psychology and money group. Folks. Thank you so much for watching. And we'll see you in the next one.