David Einhorn is a Tesla bear
Greenlight Capital’s (GLRE) founder, David Einhorn is known for being short on Tesla (TSLA). In his recent investor letter, he again bashed Tesla saying, “The wheels are falling off — literally.” Tesla stock has fallen by ~23% YTD, contributing to Greenlight’s gains.
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Tesla’s underperformance YTD
There are several factors that have contributed to this underperformance for TSLA stock. Its first-quarter car production (XLY) figures came in at 63,000 units, a sequential drop of 30.7%. Its Model S deliveries totaled 50,900 as compared to the 58,900 units that analysts expected. Moreover, Elon Musk’s issues with the security and exchange council are ongoing.
Einhorn bashes Tesla again at Sohn conference
During the Sohn Investment Conference 2019, Einhorn’s Tesla-bashing continued. As reported by CNBC, Einhorn quoted Napoleon as saying “Never interrupt your enemy when he’s making a mistake.” Einhorn continued, “So, I won’t. Just watch the screen.”
He then presented a few slides with quotes from Elon Musk where he made predictions and promises about Tesla, most of which did not turn out to be true. Einhorn then said, “That’s a lot of horse—t.”
Einhorn believes that apart from the safety concerns about Tesla’s vehicles, it’s also in a difficult position as far as its operating performance is concerned. He mentioned in the investor letter that if Q1 is any indication, total annual demand for Tesla’s Model 3 is about 200,000 vehicles as compared to Elon Musk’s estimate of 500,000 to 700,000 units.