How Different Market Participants View Tesla

Nobody can deny that Tesla is a one-of-a-kind company that investors either love or hate. There seems to be no in-between when it comes to this company. While investors who are long on the stock tend to see the unlimited potential in electric vehicles and how they could revolutionize the industry, the short side sees a reckless management team that would eventually lead Tesla to bankruptcy. Let’s take a look at both sides of the story in detail.

On one side of the fence, we have Elon Musk, who publicly stated that he sees the potential for Tesla to become a trillion-dollar company within a 10-year period. On the other side, famous short sellers like hedge fund manager David Einhorn and Jim Chanos have been rather vocal about Tesla. In a recent letter to investors, Mr. Einhorn compared Tesla to Lehman Brothers and stated that the deception is about to catch up to Tesla. Chanos went on CNBC and accused Musk of over-promising investors and stated that Musk is too willing to say things that he knows are a stretch.

What’s even more bizarre in the Tesla story is the 180-degree switch that some former short sellers have experienced. One such example is that famous short-seller Andrew Left has reversed direction and gone long on the company instead. While the market remains undecided on Tesla, evident from the high volatility that the company suffers from, it is still a rather interesting company if it does a fraction of what it promises to deliver.

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5 years ago
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