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Can Tesla Return to Its Golden Days? ETFs in Focus
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Tesla (TSLA - Free Report) stock has slumped 11.3% so far this year. Although the stock has gained 2% over the past month, a longtime TSLA shareholder is struggling to maintain faith in Elon Musk's electric vehicle (EV) company, citing a range of issues, as quoted on Yahoo Finance.
The Yahoo Finance article indicated that investor and vocal Tesla supporter Gerber recently cut his stake in Tesla from 420,000 shares to 266,000 shares, now valued at around $50 million. Last year, he was a staunch supporter of the company but has become skeptical of late.
What Causes Dissatisfaction?
Gerber, who invested heavily in Tesla during its challenging times in 2018 and 2019, feels that Musk's current focus on projects like humanoid robots, X and SpaceX is diverting focus away from Tesla's core business.
According to Gerber, Musk's shift away from the core strategy is impacting Tesla's opportunities and shareholder value. Gerber believes that Tesla's Optimus robot is an overhyped aspect of the company's future.
Struggling Fundamentals
Tesla's recent performance has been somewhat downbeat. In late July, the company reported disappointing earnings results despite revenues exceeding expectations. Vehicle deliveries of 440,000 were only slightly above consensus. Gerber also indicated that the used car market is swamped with Tesla products, adding to the company's challenges.
Tesla posted mixed second-quarter 2024 results, wherein earnings missed the Zacks Consensus Estimate, but revenues beat the same. This marked the fourth earnings miss in a row for the EV behemoth, following 10 successive quarters of a beat. The company remained cautious about its vehicle volume growth rate for 2024, which is expected to be markedly lower than 2023.
Gerber also believes that Trump’s policies, including potential repeals of EV tax credits and support for the oil industry, are contrary to Tesla’s mission. Hence, if Trump becomes president this year, EV projects in the United States may get a hit.
If you share the same view, you can play ETFs like Direxion Daily TSLA Bear 1X Shares (TSLS) , T-REX 2X Long Tesla Daily Target ETF (TSLT) and GraniteShares 2x Short TSLA Daily ETF (TSDD) .
Any Hope Ahead?
Despite these challenges, Tesla maintains a loyal retail investor base. Alexandra Merz, a former financial adviser and CEO of L&F Investor Services, remains bullish on TSLA’s long-term prospects, as quoted in the Yahoo Finance article. She believes that the stock is undervalued and pins hope on the adoption of Tesla's Optimus humanoid robots and the company’s AI capabilities.
Investors should note that Tesla’s next five years’ projected growth rate is 21.60% versus a 17.20% rise projected for the Automotive – Domestic industry. Tesla’s EPS growth rate for the next year is pegged at 37.12% versus 21.70% expected for the underlying industry.
Bullish investors can play ETFs like Direxion Daily TSLA Bull 2X (TSLL) and GraniteShares 2x Long TSLA Daily ETF (TSLR) . Also, there are some ETFs that are heavy on Tesla. These ETFs include Consumer Discretionary Select Sector SPDR Fund (XLY - Free Report) , Nightview Fund NITE (NITE) , ARK Innovation ETF (ARKK - Free Report) and ARK Autonomous Technology & Robotics ETF (ARKQ - Free Report) .
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Can Tesla Return to Its Golden Days? ETFs in Focus
Tesla (TSLA - Free Report) stock has slumped 11.3% so far this year. Although the stock has gained 2% over the past month, a longtime TSLA shareholder is struggling to maintain faith in Elon Musk's electric vehicle (EV) company, citing a range of issues, as quoted on Yahoo Finance.
The Yahoo Finance article indicated that investor and vocal Tesla supporter Gerber recently cut his stake in Tesla from 420,000 shares to 266,000 shares, now valued at around $50 million. Last year, he was a staunch supporter of the company but has become skeptical of late.
What Causes Dissatisfaction?
Gerber, who invested heavily in Tesla during its challenging times in 2018 and 2019, feels that Musk's current focus on projects like humanoid robots, X and SpaceX is diverting focus away from Tesla's core business.
According to Gerber, Musk's shift away from the core strategy is impacting Tesla's opportunities and shareholder value. Gerber believes that Tesla's Optimus robot is an overhyped aspect of the company's future.
Struggling Fundamentals
Tesla's recent performance has been somewhat downbeat. In late July, the company reported disappointing earnings results despite revenues exceeding expectations. Vehicle deliveries of 440,000 were only slightly above consensus. Gerber also indicated that the used car market is swamped with Tesla products, adding to the company's challenges.
Tesla posted mixed second-quarter 2024 results, wherein earnings missed the Zacks Consensus Estimate, but revenues beat the same. This marked the fourth earnings miss in a row for the EV behemoth, following 10 successive quarters of a beat. The company remained cautious about its vehicle volume growth rate for 2024, which is expected to be markedly lower than 2023.
Gerber also believes that Trump’s policies, including potential repeals of EV tax credits and support for the oil industry, are contrary to Tesla’s mission. Hence, if Trump becomes president this year, EV projects in the United States may get a hit.
If you share the same view, you can play ETFs like Direxion Daily TSLA Bear 1X Shares (TSLS) , T-REX 2X Long Tesla Daily Target ETF (TSLT) and GraniteShares 2x Short TSLA Daily ETF (TSDD) .
Any Hope Ahead?
Despite these challenges, Tesla maintains a loyal retail investor base. Alexandra Merz, a former financial adviser and CEO of L&F Investor Services, remains bullish on TSLA’s long-term prospects, as quoted in the Yahoo Finance article. She believes that the stock is undervalued and pins hope on the adoption of Tesla's Optimus humanoid robots and the company’s AI capabilities.
Investors should note that Tesla’s next five years’ projected growth rate is 21.60% versus a 17.20% rise projected for the Automotive – Domestic industry. Tesla’s EPS growth rate for the next year is pegged at 37.12% versus 21.70% expected for the underlying industry.
Bullish investors can play ETFs like Direxion Daily TSLA Bull 2X (TSLL) and GraniteShares 2x Long TSLA Daily ETF (TSLR) . Also, there are some ETFs that are heavy on Tesla. These ETFs include Consumer Discretionary Select Sector SPDR Fund (XLY - Free Report) , Nightview Fund NITE (NITE) , ARK Innovation ETF (ARKK - Free Report) and ARK Autonomous Technology & Robotics ETF (ARKQ - Free Report) .