Which stonks are you buying if any?

[Umfriend]

Waiting for ABN and FUR (Dutch both) to finally make some serious gains. Probably won't happen until I sell them first. Other holders of these stocks should pay me to sell them

[dZeus]

The UK is seeing a slight resurgence of covid cases, mostly of the B 1.617.2 variant. While in early stages, it may mean that the AstraZeneca vaccine does not provide sufficient protection to slow the spread much of this variant. It's too early to say this with confidence though, and the UK's vaccination rate seem to slow down and might reach a plateau that might be below levels providing herd immunity.
I'm not very confident that France will do much better, considering the level of vaccine distrust.

In other news, I had my first jab of the Pfizer vaccine yesterday. Second jab scheduled in 6 weeks.

IAG shares went further down the drain, should have sold them when they had a pre-gamma variant peak (what sense is there in predicting what's going to happen when I don't follow up my own advice).
Fortunately compensated by the space investments (former VACQ and NSH SPACs) are taking off, even though I fear it's more because of meme-stock induced 'casino' behaviour, which would be bad long-term as it creates too much fluctuation for institutional investors to consider them.

Right now I have a real conundrum around investing money for the medium-long term. I believe that:
- share prices are at rediculous valuations, only made possible because of near-0 interest rates. If interest rates rise, I think it'll be disastrous for the stock market. My broker unfortunately is a pretty big player in margin lending (no, it's not Robin Hood), and I think a market-wide crash would wipe out most margin lendees and cause big trouble with their total balance sheet. Since this broker holds the share entitlement in their name, I'd be pretty far down the list as a creditor. Even though I consider the risk of a market-wide meltdown low (I think central banks would buy whatever it takes to prevent a sudden crash, although it may prove impossible to stem the tide in case enough investors panic. The non-0 risk has enough downside to make me consider the impact and possible mitigation strategies).
- There's way too much debt in this world to grow out of 'organically'. Near-0 rates and huge amounts of liquidity injections by central banks buy time (or 'kick the can' depending on what your vision is), but there's no 'good' solution in sight for the amount of debt. The low interest rates lead to massive mis-allocation of capital and as a result speculative bubbles everywhere.
- Politicians and central bankers will try and kick the can down the road a long as they can, and at a certain point will have to accept high (or even very high) inflation without raising rates (aka 'financial repression'). There's still a lot of education to do (on my side) to understand what assets are good to invest in during financial repression. I fear there might be 'mostly losers' in this environment, just some people will lose relatively more than others. Maybe having a (relatively) large mortgage on the house you live in, and use the borrowed money to bring down long-term recurrent costs for heating/energy/upkeep/etc. as much as possible is a good strategy.

Long term, I would like:
- to invest in agricultural land in places that is in an area that will 'benefit' from climate change (or at least not do worse). However, it is not very obvious to invest in agricultural land without becoming a farmer (which I don't intend to). Maybe try and find a agricultural cooperative to invest in?
- invest in water purification technology (there seem to be a lot of investment scams around this concept unfortunately)
- electrification / energy generation (most western countries have set themselves goals around usage of electric cars and reducing usage of coal and natural gas, but don't have the equivalent investment in generation and distribution of electric energy; never mind energy storage needed when using renewables such as wind and solar); metal-air batteries show some promise, but there are very few publicly tradeable companies to invest is (maybe the Israeli Phinergy?). Most promising technology companies are in startup phase, and as a private investor you need more money than I have available to be able to invest (such as through a platform like EquityZen).
- fintech that disrupts traditional banks' business model. I'm keeping a close eye on Wise, N26, etc, but they need to become more mature and offer more services in order to really displace traditional banking (or at least, show enough ambition to become like this).

[UtwigMU]

I got 4 cents / share nVidia dividends today. How is everyone's portfolio doing?

[Umfriend]

ABN has been better recently, FUR still at somewhat disappointing levels. Not doing anything for a while.

[Dr Mordrid]

Jesus....

https://www.nytimes.com/2021/10/25/business/tesla-trillion-stock-price.html

Tesla shares surpass $1 trillion in value.

Tesla shares vaulted to new heights on Monday, giving the electric-car maker a market capitalization of $1 trillion for the first time.

The latest gain — of nearly 13 percent in the day’s trading — came after Hertz announced that it would buy 100,000 Tesla cars by the end of next year. Electric vehicles would then make up more than 20 percent of its global fleet.

Tesla’s share price has risen more than tenfold since mid-March of last year, in the early days of the pandemic, when it fell below $100. The stock closed Monday at $1,024.86, its first close above $1,000.

The trillion-dollar valuation is the latest sign of how Tesla has disrupted the auto industry. The company is now more valuable than General Motors, Toyota Motor, Ford Motor, Volkswagen, BMW, Honda Motor and several other automakers combined.
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[UtwigMU]

Tesla is valued 2M per car sold. Realistic (VW, Toyota, Ford) is 15-25k.
They made 500k cars, while big companies make 9M per year. Last year they were only profitable because of subsidies and crypto pump and dump.
What is more probable: VW, Toyota hitting 15-20 trillion valuation or Tesla coming down to more realistic 100-500M?

So this valuation won't hold forever. What's your exit strategy Doc?
I'm too late for Tesla and YTD both MSFT and NVDA outperformed Tesla.

My stock purchase is near and I don't know what direction to go. My longterm goal is mix of dividends and growth. My goal is to save up capital, at some point I might buy apartment.

More dividends: since there is high inflation, good dividend stocks are getting expensive and dividend yield lower. Since I pay 15% to uncle Sam and then additional 12.5% to my local government from dividends, they are not so hot although nice to have as they pay for brokerage fees. I don't have enough capital to create LLC and break even on lower taxes vs costs of running a LLC.

Growth: I don't see anything not risky and cheap at the moment. Some ideas: Airbnb, Fiverr, Upwork, Intel (if they return to being leaders)
AMD, nVidia, Nokia, MSFT and other FAAMGs type stocks are all expensive.

Index: EQQQ (Nasdaq), SPY, BRK (Berkshire is practically a mutual fund)?

Diversify from tech? (now 40% pharma, 55% tech)?
Now 55% dividend, 35% growth although one of my large holdings is both growth (+50% growth, 4% dividend yield) and dividend.

[dZeus]

My growth strategy is mostly focused on space (RKLB and RDW), as well as Vanadium redox flow batteries (miners, eg LGO). Dividends with big oil (TTE).

Once interest rates on corporate bonds start to rise, I see debt-fueled growth companies taking a big beating as well as highly leveraged companies and the stock market in general.
I don't see much that looks appealing to invest in when inflation goes up a lot (while gov bond rates are surpressed below inflation rate), other than stuff that will help bring down your own long term fixed costs: own a property with a garden where you can grow some food, and get ways to reduce your reliance on potentially very expensive fossil fuels and/or methods subject to stricter environmental protection laws. My plan is to apply thermal insulation as much as possible and to install low temperature underfloor heating (powered by solar thermal energy and a heatpump) alongside the existing natural gas heating and wood stove.

[Dr Mordrid]

Tesla is valued 2M per car sold. Realistic (VW, Toyota, Ford) is 15-25k.
They made 500k cars, while big companies make 9M per year. Last year they were only profitable because of subsidies and crypto pump and dump.
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Tesla will hit over 900,000 this year with 2 new factories (Germany, Texas) opening by year's end, and well over 1.5 million next year. In their last quarterly they had a 30.5% gross margin, of which only 2% were credits. Cash: $16.065 billion as of Sep 30, 2021.

What is more probable: VW, Toyota hitting 15-20 trillion valuation or Tesla coming down to more realistic 100-500M?

Amid the rapid conversion of the auto industry to electric, VW and Toyota are scrambling in Tesla's wake.

Toyota was in denial over pure EVs, pushing fuel cells, while others advanced battery techs. Now batteries are becoming so cheap fuel cells are a niche.

VW has admitted they're far behind Tesla and scrambling; Diess reported it takes them 30 hours to make a vehicle while Tesla rolls one off the line in 10 hours, and that gap will increase. Tesla is switching to a structural battery pack for the center frame, with the front and rear chassis segments being one piece high pressure (6000-8000 tonne) castings. Bolt together and you have most of the vehicle. Goodbye to hundreds of parts and the processes it takes to assemble them.

Tesla-Model Y_rear_casting+4680_structural_battery-1024.jpg

[VJ]

Amid the rapid conversion of the auto industry to electric, VW and Toyota are scrambling in Tesla's wake.

That is not the point UtwigMU is making... Tesla is worth more than VW, Toyota, GM and Stellantis combined. Now suppose Tesla manages overnight to replace all of these brands, then Tesla would be valued much higher than those four groups, even if there is not that much growth potential in the scenario where those no longer exist.
It could be a change of the meaning of valuation, closer to silicon valley than to car-manufacturers, but still it feels something is off here.

[Dr Mordrid]

That is not the point UtwigMU is making... Tesla is worth more than VW, Toyota, GM and Stellantis combined. Now suppose Tesla manages overnight to replace all of these brands, then Tesla would be valued much higher than those four groups, even if there is not that much growth potential in the scenario where those no longer exist.
It could be a change of the meaning of valuation, closer to silicon valley than to car-manufacturers, but still it feels something is off here.

The problem is that some still view Tesla as just a car company when it isn't. Tesla Energy is a growing business, with small to utility scale battery installations going in worldwide and they just expanded with a huge new factory in California. Major products; Megapack, Powerpack, and Powerwall (home, small business), silicon carbide control systems, etc.. This dwarfs their solar roof business, which is better known.

The large units (Megapack, Powerpack) don't just do power storage, but also perform grid management; frequency control, Autobidder (automatic bidding for power distribution), brownout prevention, replacing peaker plants, etc.

They're also developing microgrids; solar on every roof in a development with distributed storage including Vehicle 2 Grid technologies (using EVs to do grid backup for the neighborhood). The plan is to test it in Australia.

Tesla Energy just announced they're switching to the lithium iron phosphate chemistry - which is safer, longer lasting and far cheaper (cobalt & nickel free).

Ex:

https://www.bloomberg.com/news/features/2021-03-08/tesla-is-plugging-a-secret-mega-battery-into-the-texas-grid

Tesla Is Plugging a Secret Mega-Battery Into the Texas Grid

The utility-scale battery located outside of Houston will connect to the same grid that faltered in February’s freeze

Elon Musk is getting into the Texas power market, with previously unrevealed construction of a gigantic battery connected to an ailing electric grid that nearly collapsed last month. The move marks Tesla Inc.’s first major foray into the epicenter of the U.S. energy economy.
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While Tesla’s focus on energy often takes a back seat to the increasingly competitive business of manufacturing and selling electric cars, Musk and his executive team continue to highlight energy as a key part of their growth. “I think long-term Tesla Energy will be roughly the same size as Tesla Automotive,” Musk said during an earnings call in July 2020. “The energy business is collectively bigger than the automotive business.”
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https://www.prnewswire.com/news-releases/arevon-signs-agreement-for-2-gw6-gwh-of-tesla-megapack-systems-301386238.html

Arevon Signs Agreement for 2 GW/6 GWh of Tesla Megapack Systems

NEW YORK and SCOTTSDALE, Ariz., Sept. 28, 2021 /PRNewswire/ -- Arevon, a leading renewable energy company, has secured a 2 GW/6 GWh supply of Tesla Megapack to support its growing utility-scale storage portfolio through a master supply agreement. By the end of 2021, Arevon will have overseen construction and operation of 250 MW/1,000 MWh of battery energy storage systems deploying the Tesla Megapack at sites in California and Nevada.
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[dZeus]

The Tesla big battery operator Neoen has been sued in Australia for failing to provide grid backup as promised. Would be interesting to see what the root cause for non-compliance was.

Toyota is far behind in EV technology, as they were leading for a long time in hybrid and got fully invested in the switch to hydrogen cars. Might turn out to be an extremely expensive mistake on their part. I've read many negative opinions on the suitability of hydrogen as medium of energy exchange in cars, and tanking up in fuel stations is an expensive and slow process due to the differences in hydrogen pressure that need to be overcome, which undo many potential advantages vs electric charging of EVs.
Stellantis is a huge conglomerate of historically money losing businesses, and I wouldn't invest any money in there personally
VW has understood the need to ramp up with EV, but they also are quite a bit behind Tesla and have suffered reputational damage with dieselgate. With the recent semiconductor shortage, I started to understand that most car manufacturers are lightyears behind using modern microchips and process nodes. I understand the need for fault-tested and reliable-longlasting well understood mass-produced electronics, but without trying to innovate you will fall behind competitors that can consolidate a lot of electronics into much fewer parts. modern development practices around car software are also essential to this end. We'll see if VW can manage to catch up, at least they seem to understand how far they are behind.

I wouldn't be surprised if the biggest threat to Tesla will come from China, either directly (there are plenty of Chinese players in the Chinese EV market), or indirectly (eg Polestar or other Chinese-controlled foreign manufacturers).

Another interesting point is that existing manufacturers that fail to compete in the EV race might be better off becoming OEMs for IP companies like Apple, as their manufacturing capacity and knowledge should still be able to generate good revenue.

Tldr; I won't touch TSLA shares myself, but valuation of historical manufacturers might be reasonable or even high when looking at the very rapid shift to EVs that is now starting, and the uncertainty in how well they will be able to compete.

[UtwigMU]

Tesla's Giga press is Italian. We and all other gelato machines manufacturers order pressed/pulled basins from a single Italian company which has presses with sufficient pressure.

If you check Idra Group's website they had techies from Audi on educational course in 2019. They also have Magna and Renault in their news page.
Yes, casting car is cool but it's not something others can't also do.

This Idra Giga press is a bit like Apple, Bose or Leica who thinks of special names (eg retina display for high DPI IPS) for standard so as to stand out as luxury from regular companies.

[Dr Mordrid]

Tesla's Giga press is Italian. We and all other gelato machines manufacturers order pressed/pulled basins from a single Italian company which has presses with sufficient pressure.

If you check Idra Group's website they had techies from Audi on educational course in 2019. They also have Magna and Renault in their news page.
Yes, casting car is cool but it's not something others can't also do.

This Idra Giga press is a bit like Apple, Bose or Leica who thinks of special names (eg retina display for high DPI IPS) for standard so as to stand out as luxury from regular companies.

Looks like one other company has bought a Giga Press; Glovitech, and they're making Faraday cages. Tesla bought the rest, and they're buying a lot more - including for Cybertruck. But the machine is only part of the secret sauce; other constraints on other car companies using Giga Press (scrub to 05:40),

[UtwigMU]

Yes, other companies have conveyor belts instead of fork lifts.

[Dr Mordrid]

Tesla hit $1.1T Friday, and according to Morgan Stanley an annualized production rate of 1 million. This without Austin and Berlin being in production.

Agreed, there are castings in other vehicles but they're relatively small.

Model Y front casting
Model Y front casting 1024.jpg

Model Y rear casting
1635652649237.jpg