Tesla, I'm bearish, but I won't short it.
There are various reasons why I am bearish on Tesla, and I can list them one by one for rational people. I know them like the back of my hand. (Please read to the end.)
Reason one: The current decline is just the post-election bubble bursting. The current price is still much higher than before the election. Before the election last year, Tesla's global sales were normal. But now, since Elon Musk got involved in politics, how have global sales performed? So, the real decline hasn't even started yet.
Reason two: The current P/E ratio is over 130x, far higher than the 30x of high-quality companies like Apple and NVIDIA, whose products are essentially monopolies. Tesla's main revenue source, its cars, does not hold a monopoly in the market, and sales are now in continuous freefall. Therefore, there's still significant downside potential, and the current bubble is huge.
Reason three: In China, the neutered Model 3 has been crushed by Lei Jun's SU7, and the Model Y's good days are numbered. Nio's Onvo L60, XPeng's new G6, and Li Auto's L6 form a "666" lineup that's eating into the Model Y's market share.
Reason four: Tesla has been profitable for years but has never paid dividends to shareholders. Meanwhile, Musk awarded himself a $50 billion mega-bonus (though he hasn't cashed it yet). Can a manager this stingy with shareholders really care about their interests?
Reason five: Major authoritative rating agencies have downgraded Tesla's stock. JP Morgan and UBS, among others, have cut their targets to $120 per share—and these are relatively neutral institutions.
Reason six: Humanoid robots aren't some exclusive Musk fantasy. Over the past two months, China's humanoid robotics sector has been advancing rapidly, and competition is heating up. Companies like Microsoft, NVIDIA, and Amazon are investing in American humanoid robot maker Figure AI. Meta is also planning major investments in humanoid robotics.
One last risk that can't be ignored is Tesla's deep entanglement with Musk. A big chunk of Tesla's 130x P/E comes from Musk fanboys, whose worship of him has turned into blind faith in Tesla. Musk's DOGE coin has already upset many vested interests. In today's gun-ridden, socially divided America, it wouldn't be surprising if someone tried to take him out. If that unfortunately succeeded, can you imagine how Tesla's stock would react?
BUT!!!!!! I'm bearish—but I won't short, because the stock market is driven by hype and sentiment. Tesla has too many speculative angles, and "Ma Baoguo" (Musk) isn't down yet. There are too many external factors at play, and the gamble is too big—short squeezes can be brutal. Better to stick with the index for safety.$Tesla(TSLA.US) $GraniteShares 1.25 Long TSLA Daily ETF(TSL.US) $Direxion Daily TSLA Bull 2X Shares(TSLL.US) $GraniteShares 2x Short TSLA Daily ETF(TSDD.US) $Direxion Daily TSLA Bear 1X Shares(TSLS.US)
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