Tesla IPO Building Momentum

Tesla is two weeks into its roadshow, and due to come out today. It is increasing the size of the float from 11m shares to 13m shares, a very positive sign. At this point in the process, the underwriters are getting feedback from institutions and building an opening day book of orders.  

Given the interest, the stock would be expected to sell at the high end or even above the range of $14-16/share. Indeed, it got priced Monday night at $17, valuing the company at $1.6B, a bit lower than a research estimate last week at $1.85B, or $20/share. The buzz last week was also generally positive. The last minute (unsigned) deal with Toyota also boosted interest.

There is a strategy to these sorts of IPOs to buy the dip six months after offering. Last Sept a much-hyped green IPO, A123, popped 50% on the first day ($29) but has since dropped below the offering ($13.50) to under $10. It has now come out of the 180 day lockup, where insiders begin selling and further depress the price. When that selling abates, the stock typically becomes a buy - especially in this case if Tesla does well, since A123 supplies batteries for electric cars.

A successful offering could strengthen the tech IPO market, which has gotten despairingly weak recently. Given the bellweather status of the first electric car startup going public, a successful offering could also bolster a whole slate of green offerings, such as Smith Electric, an electric truck startup that also wants to go out, and Fisker, the closest venture-back competitor to Tesla. It might also have a halo effect on solar IPOs, which were hot three years ago and have been downright chilly recently. eSolar may be the next solar IPO to test the window. 

Comments

[Account Deleted]

U.S. Markets view before opening bell
http://niftychartsandpatterns.blogspot.com/2010/06/euro-zone-worries-for-world-financial.html

[Mamma Boom Boom]

>So Mamma are you bullish because of astrology?

Posted by: Bird | Monday, June 28, 2010 at 02:53 PM<

Nope! Just throwing it out there for discussion.

[Bird]

1061 Mamma. You practically promised.

[Mamma Boom Boom]

Going all the way!

1050

[Bird]

That's how I like to think of you Mamma.

[Bird]

Problem is, no bottom can form before 11 a.m. at the earliest. And if it misses that 11-11:30-ish window on the 30 min, no telling where it all will end. (Course I cannot be trusted unless birds are smackin' their heads against the window).

[Mamma Boom Boom]

>Problem is, no bottom can form before 11 a.m. at the earliest.<

It won't.

[Roger D.]

Mamma are you bearish?

RD

[Roger D.]

Racy looking car,that lady needs a helmet,nice headlights though.

RD.

[Mamma Boom Boom]

>Mamma are you bearish?

RD<

?

[Roger D.]

>Mamma are you bearish?

RD<

?
Roger D.

It's a very fine morning, Mamma.

[Roger D.]

The big picture.

MCD

Roger D.

http://www.screencast.com/users/parisgnome/folders/Default/media/2e436a77-cc4e-4d6d-b66e-73d3dba866a2

[Roger D.]

The little picture

MCD

Roger D.

http://www.screencast.com/users/parisgnome/folders/Default/media/37169c4d-2d40-4e57-8a94-1ba0cfb40a1c

[Wave Rust]

ok,
it's time to buy this ugly pig

i said to buy spx 1055 if seen. it's been seen and a chunk more.

stop 1038 if you are a trader. at least one more dive today.

it's probably going to try to spook the bulls later today, and suck in the giddy knucklehead perma-bears.

first stop is 1105 ,,,, as usual

wave rust

[Roger D.]

1040 falls like a knife through warm butter,the beginnig stages of a panic.

Roger D.

[Roger D.]

Buying TZA

Roger D.

[Roger D.]

TZA filled.

RD

[Steven_737]

"it's time to buy this ugly pig"

are you actually encouraging people to buy this?

are you seriously telling people to catch a falling knife without giving them the parameters of the trade other than a 3% stop?

you are not even referencing a trade management time frame!

good grief!

[Roger D.]

The ECB failed auction can't be good for the EUR.

This market is a dig 3rd.

7.70 on my TZA, my be a little early but the reward seems great here.

Roger D.

[Account Deleted]

Dow Jones week chart with a broken rising wedge
http://niftychartsandpatterns.blogspot.com/2010/06/dow-jones-weekly-chart.html

[nspolar]

Roger D,

Let us assume we are in a bear until latter half of next year. A good long bear.

Where do you expect TZA to retrace to, under those conditions?

The longer term moves of these leveraged inverse ETF's are difficult to gauge.

Maybe 6 Weeks Topping Mama knows?

ns

[Roger D.]

ns

I would think the open gap at 60-65 would be filled.

Roger D.

[Mamma Boom Boom]

What are the odds that technical indicators fail in the second half of this year just as they did in the second half of 2008?

[Roger D.]

Looks to be a series of 1,2's,which implies a slice down through 1040 is coming.

Roger D.

[Mamma Boom Boom]

>Looks to be a series of 1,2's,which implies a slice down through 1040 is coming.<

I love it when you talk that way.

[Brad]

Neely stopped out on his long trade - his first loss in months. It's also his first trade in months. Enjoy your vacation loser!

[GLN]

Neely is a joke.
Not sure why anyone would even mention his name in the same context of "making money".

[GLN]

Meanwhile, it looks like Prechter might actually have an opportunity to "break-even" on his short sale recommendations from last August at SPX 1000, and again at SPX 1038. Another joker.

[Wave Rust]

steven,

i guess you don't trade much. lots of chatter and charts though.

how's that fork wave trading plan working out for you?

:)

wave rust

[molecool]

GLN - where is YOUR analysis? Face it - you're some dude who feels empowered by bitching on a blog. Nobody ever will care about what you have to say/offer and nobody will remember you. They will however remember Bob Prechter.

[David]

Yelnick,

I guess the "goat rodeo" as you called it is about over.

[yelnick]

David, the goat rodeo never ends! Imagine that we bounce today off 1041 - a triple bottom - and run up to 50-62% of the drop:
- from 1131, a 90 pt drop, up to 1086-1097
- from 1174, a 133 pt drop, up to 1107-1124

This would be a normal wave (ii) back up, but will look like a huge run and restoration of Hope.

[Bird]

I'm still quite cautious, and longer term bearish, but see at least some reason to think things could move up from here. MCD satisfies the criteria I follow, so I am now long here, with stop below today's low.

[Account Deleted]

DG !!

Now that Neelys B wave Triangle theory has been violated today what do u think can happen going forward.I mean what is the structure u r looking at currently.

Would u still not dare consider the ensuing downfall as a 3rd Wave of the FLAT since 2008.

Regards
VB

[Account Deleted]

DG !!

Now that Neelys B wave Triangle theory has been violated today what do u think can happen going forward.I mean what is the structure u r looking at currently.

Would u still not dare consider the ensuing downfall as a 3rd Wave of C of the FLAT since 2008.

Regards
VB

[Mamma Boom Boom]

Last hour: nibble .. nibble

[Roger D.]

Last hour: nibble .. nibble

From 1030 or 1020? lol

Roger D.

[upstart]

Just wish I already had more short...The cycles I talked about are at work. Fortunately, people are not yet getting that April was the high for the year.

[Mamma Boom Boom]

One of my purchases for the day was Rick's Cabaret International Inc. Been on my watch list for some time. See if it adds a little spice to the portfolio.

[Steven_737]

rust;

"i guess you don't trade much."

the frequency of my trading is not the issue... :)

the issue is the quality of your trading recommendation!

"lots of . charts though "

I suppose you trade by reading tea leaves!
Is that the reason you post billboards?........... :)

"how's that . trading plan working out for you?"

Fine... Thanks for asking!
better than your "catch the falling knife" trade you posted today!!

be well; trade well :)

[Bird]

Does anyone else here see a reason why the end of the day lows could be a trade-able bottom? Dow hits on all notes, and SPX on almost all, and I'm already in MCD. Doesn't mean it will. But by my measures the market is "allowed" to turn north here on 30-60 min time scales.

One element among a few: time from May 25 low to June 21 high on SPX x .382 in time.

Of course, the birds have not whispered anything to me, so this is just plain OLD STUPID GUESSING.

[GLN]

"GLN - where is YOUR analysis? Face it - you're some dude who feels empowered by bitching on a blog. Nobody ever will care about what you have to say/offer and nobody will remember you. They will however remember Bob Prechter." - molecool

Congratulations Mr. Mool.
Anyone that embraces a trading strategy in which they go 50% short at SPX 1000 in August of 2009 and another 50% short at SPX 1038 a couple of months later . . . only to see the market blast-off to 1220 SPX without a stop-loss is a complete MORON.

You obviously don't trade for a living.
If you do, I would hate to think that you have no problem with being FROZEN to a losing trade for 10 months and a 22% drawdown in capital at worst case.

Thanks again for showing just how stupid you are in your man-love for Bob Prechter. Guess you weren't around for his "Lost Decade" between 1993-2003 either.

LOL!

[Roger D.]

Dead cat bounce? tomorrow short any rally.

Roger D.

[nspolar]

Yelnick,

http://finance.yahoo.com/q/bc?s=C+Basic+Chart&t=my

http://www.thestreet.com/_yahoo/story/10795262/1/citigroup-shares-survive-brief-halt.html?cm_ven=YAHOO&cm_cat=FREE&cm_ite=NA

Any bets on C making it to the end intact. Chart does not look good. Worse than Enron?

There will be no more govunment bailouts imo. Political suicide.

ns

[usdollar]

I believe we will see continued week market with absence of any sharp long bounces for the same reason Yelnick did not believe we would hit 1150 earlier. Everybody expects it. Everybody knows by now that this H&S has a target around 8350 DJIA +-. So the market will not let anybody in now without a fat premium. I believe we will contine to drift down with some kind of lower lame top from the underside of 9800 around July 8. July 12 is a tipping point from Webbot, they have sofar never been wrong on these. May 6th was the last one, before that October 7th 2008.

[Bird]

Well Mamma, I like Rick's synchronicity of (6.18%) loss today, and the June low being a .618 retrace. Sounds like a sure thing to me. Also, the March high isn't the most harmonic of ends to a trend (viz. more highs to come?), and the June low's pretty good.

[Roger D.]

The ES chart, looks like we get 3 of 3/3 next

Roger D.

http://www.screencast.com/users/parisgnome/folders/Default/media/27ed8cb4-834b-4f30-bdbb-dd58fe2d5343

[Roger D.]

MCD is really looking quite nasty, a crash wave in the making.

Roger D.

http://www.screencast.com/users/parisgnome/folders/Default/media/1b1019f6-b3e4-4b34-84cf-62dea567fbef

[Hockthefarm]

The doors on the Prechterian Void are starting to open. And right on schedule imo.

I am holding out for a nice bounce into mid July before the doors swing wide and Abby Joseph Conehead puts on the bear suit.

Hock

[yelnick]

ns, if the finreg bill fails and later C splits apart despite the failure to reinstate Glass-Steagall, it would be a huge irony! After the party of fiscal responsibility comes to power, we should push for the Repeal Acts to simply eviscerate a whole series of poor laws and the accompanying regs. Otherwise, attempts to "reform" get caught int he maw of lobbyists. High on the list of repeals are the law ending G-S, the law banning any regulation of derivatives, and the 1977 CRA that eventually led to the housing bubble.