I’m reaching a limit on how many stocks I want to have in the hedge fund and in my personal portfolio, but I have one more name I am adding to the portfolio — and it’s another one that might shock you. After all, the CEO personally blocked me on Twitter years ago.
How many times have you heard me say that we should always bet on brilliance? When I bought Apple at a $1 per share back in 2003, it was a bet on their valuation and on the vision of Steve Jobs. Those who invested in Amazon in 2001 might have liked the idea of an online bookstore, but the brilliance of Jeff Bezos is, that like Steve Jobs or Mark Zuckerberg, that he was envisioning so much more — AWS Coud, Amazon Shipping, AI, Voice Revolution, etc.
Which leads me to Elon Musk, the CEO of Tesla.
Here’s a fun tidbit. Back in early 2009 when I was anchoring my show on Fox Business, I actually got to drive one of the first Tesla cars ever produced. In fact, we shut down Central Park and I got to drive the 2008 Tesla Roadster full speed and took it from 0-65 in like 2.8 seconds or something. It was sweet. But I’ve been very skeptical of all the tax credits and corporate welfare and government assistance that Tesla and their customers have built their business upon, so I’ve been mostly bearish on Tesla.
Regardless, as I step back and try to find the most Revolutionary companies led by the most brilliant people in the world, I have decided to build a position in Tesla TSLA. Here’s my bullish notes:
- The adoption curve of electric vehicles (EV) is about to happen faster than most people realize. 10 years from now, EV market share will likely be double what most analysts are expecting.
- Tesla’s lead (moat) in EV technology, and perhaps more importantly, in production of battery/EV technologies, is substantial.
- Tesla plans to ultimately build between 10 and 12 Gigafactories, according to Musk, (they have almost 2 so far), and that capacity is another moat-ish factor.
- Tesla’s investments in autonomous vehicles (AV) will also help in creating a network of Lyft/Uber-like ride sharing Tesla cars.
- Tesla trucks, semi’s, buses, etc are coming in future years too.
- My concerns about financing and funding all this growth have abated as the company seemingly has access to as much capital as they’d need and is generating cash payments to help this.
- There are shorts everywhere in this stock and they are active, vocal and aggressive. Go look at the TSLA articles on Seeking Alpha and you’ll see most of them are about how Tesla might be going bankrupt or how much risk there is because Elon Musk is a loose cannon.
- The stock is down big this year, giving us a good opportunity to start building a long-term investment in it.
- Yes, Elon Musk is a loose cannon and he’s actively blocked me from being able to follow or see his tweets on Twitter. But who cares? The guy’s proved his brilliance over and over: Paypal, Tesla, SpaceX, The Boring Company. I mean, let’s bet on his brilliance.
So, I’ve started building a position in Tesla, about 1/2 as much as I want to own so far, but I’ll probably nibble some more on this one often for a few days or weeks here to build it up to a full position soon.
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