Late bubble investing at its finest $TSLA $TSLAQ
Tesla will host an “Autonomy Investor Day” on April 22, hoping to convince Wall Street that it deserves to be valued like Lyft (just IPO’d at a $24 billion valuation) or Uber (soon to IPO and wants a $100 billion valuation).
It’s keeping its options open. After all, its car manufacturing and solar panel installation activities may all turn out to be structurally unprofitable. But it might still be able to attract investors with the promise that it will disrupt the ride-hailing companies, some day in the future.
The ride-hailing companies themselves don’t make any money yet, but in the current year that is not deemed terribly important!
Elon Musk, despite ongoing negotiations with the SEC about his irresponsible use of Twitter, has been working this meme on Twitter. At 6:33 PM on 4 April, he responded to a query about a camera in a Tesla as follows:
The company pushed this idea again yesterday with the announcement of leasing options for the Model 3:
“Please note, customers who choose leasing over owning will not have the option to purchase their car at the end of the lease, because with full autonomy coming in the future via an over-the-air software update, we plan to use those vehicles in the Tesla ride-hailing network.”
What this means is that the latest phase of the stock pump based on imaginary autonomous driving software is in full swing.
We have a bubble stock desperately trying to maintain its bubble valuation, by latching on to the valuations of other bubble stocks.
The company should raise equity now or later this month from any institutional investors who believe its claims. Several billion dollars should do the trick, at least to get it through the next few quarters.
This is late bubble investing at its finest. But when will the clock strike midnight?
At the time of publication, the author has a short position in TSLA and a long position in TSLA puts.