Why Did an Early Tesla Investor Sell All Their Shares?

TL;DR

An early Tesla investor has sold all of their shares, claiming the stock is only worth buying back under $400 per share due to overvaluation concerns. They believe in Tesla's long-term potential, but think market conditions, including increased competition and macroeconomic factors, will drive the price lower. Morgan Stanley's estimates for Tesla’s growth are also criticized as overly conservative.

Transcript

a thousand bucks a share around a trillion dollar valuation uh what's tesla really worth and what's the price you'd be willing to pay to get back in yeah i was fortunate enough to look to see the company back when it was a private company and invested in late 2008 i believe and sold the big chunk in 2013 and the rest when it reached over a trillion... Read More

Key Insights

• ❓ The investor believes Tesla's stock price will dip below $400 per share before they consider buying back in.
• ❓ Morgan Stanley's conservative estimates for Tesla's future earnings and production capacity have been criticized for underestimating the company's potential.
• 🙈 The investor sees Tesla as a must-own stock in an energy transition and battery electric vehicle portfolio.

Questions & Answers

Q: Why did the investor sell a large chunk of Tesla stock in 2013?

The investor sold the stock after it had increased tenfold since their initial purchase in 2008. They wanted to lock in profits and may have underestimated Tesla's future potential.

Q: What is the investor's strategy for buying back Tesla stock?

The investor plans to wait for the stock price to dip below $400 per share before purchasing again. They believe this is the right price for long-term investment.

Q: What are the potential challenges Tesla may face in the near future?

Some challenges include supply chain issues, potential recessions affecting consumer spending, and increased competition in the electric vehicle market. However, Tesla's competitive advantages and engineering expertise may help them navigate these challenges.

Q: Why does the investor believe that retail investors hold valuable insight into Tesla's future?

The investor suggests that retail investors may have a more independent and less biased perspective on Tesla's potential, compared to Wall Street analysts. They believe retail investors have seen something in Tesla that Wall Street may have missed.

Summary & Key Takeaways

• The investor purchased Tesla stock in 2008 when it was still a private company and sold a large chunk in 2013 and the rest when it reached a trillion-dollar valuation.

• Despite believing in the company long term, the investor thinks the right price to buy back in is around $400 per share.

• The video also discusses new research from Morgan Stanley on Tesla and addresses the potential impact of competition, consumer spending, and supply chain challenges.