After receiving several DM questions & tags re my view of TSLA

TSLA and other EV stocks are in a bubble, and we are on the other side of the peak.

A thread:

The stock price should be viewed separately from the company.

My supposition remains that TSLA stock will be an excellent buying opportunity again in the future.

The stock should be analyzed from the perspective of any other bubble.

Let’s take marijuana.

It is not relevant that Tilray has increased revenues by a multiple of 8 in two years, when the stock price was above $100 the company was clearly overvalued.

This was not a Tilray phenomenon, all of the marijuana companies were overvalued.

(I have never had a position in a Marijuana production company)

I have heard at length from Tesla bulls who state that increasing revenues and vehicle production numbers justify current valuations. I find this proposition particularly absurd given the capital-intensive nature of the automobile industry.

Within the EV space, many companies sport similarly optimistic valuations as Tesla.

This is not to say these companies are bad or without a future, it is to say that at times the market will hand you gifts, and your task is to accept those gifts with grace & style.

I notice as well that several well-known and experienced investors have very recently announced short positions in Tesla, specifically I refer to Dr. Michael Burry and Julian Brigden.

On the other side of the trade are retail investors, who continue to go “all-in” in one stock.

One of my followers whom I like very much announced this week that he had sold other securities to purchase additional shares in Tesla, and he is already very overweight Tesla.

This is very dangerous, and generally something we see at tops.

It might also be worthwhile to address the problem of over-capacity in the auto industry generally.

Although perhaps that is better covered elsewhere.

Suffice it to say margins will revert to the mean as they always do.

Now *that* view is based on the idea that all EVs are roughly similar. Tesla may well command a small premium, as it remains the only company which produces Teslas.

Rather as HOG is the only company producing Harley-Davidsons.

And of course I could be wrong: it is possible a short-term catalyst will move the stock price higher. It is also possible I am wrong in general, it certainly happens often enough.

However my price target remains $50 at some point in the next five years.

I will have a very limited time for engagement today, but I will try to answer questions that I have not previously answered.

Please no trolling.

Have a wonderful weekend!