Tesla Stock Now is like Bitcoin Bubble in 2017. Crash is Coming says Tesla Short. My reaction
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Came across this article last night that said “Totally normal and not a bubble chart”. immediately I knew they would be referring to Tesla stock in a joking way. Let me give my 2 cents on this.
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Well guys late last night before it got to go to bed at about 3:45am or so actually saw something really, really intriguing before I went to bed and no, it was not me playing around the app that can make you look like a female or male or somebody of the opposite sex.
Okay? It was not that it was this here, okay, this popped up on Google. It’s the I mean, the headline alone, it got me it like got me man, it said totally normal, and not a bubble chart. And as soon as I saw that article recommended to me, I knew immediately I knew immediately they’re going to be talking about Tesla stock, okay?
And this person is being facetious Okay, when they say totally normal and not a bubble chart, they aren’t being serious about that. Okay, they’re joking. This is a short seller, basically saying that Tesla stock is a bubble, okay.
And we’re going to look at exactly what this individual has this safe? Do they have any points? In my opinion? Do they not have any points and all those sorts of things? Okay, so that’s the goal in this video, okay, I’m going to react to their their bubble thesis, let’s call it that.
It’s not even a short thesis is a bubble thesis. Okay. Some comparisons some people are doing out there between, you know, what’s going on with Tesla stock and what happened with Bitcoin a few years ago.
Okay, I’ll give my reaction to that, then I’m gonna react to the some of these comments. It’s actually some very intriguing comments that were in the comment section of this particular article. I’m going to go through those kind of react to those.
And lastly, I’ll share my opinion on if I think Tesla’s kind of in a bubble situation right now, which we saw the stock was up again, I think it hit 22 plus $100, a share or something like that. Are we in bubble territory?
Are we not okay, so I’ll share a very in depth opinion on that as well. So hope you guys enjoy today’s video. As always, it should be a fun one. It’s actually a very rare video that I’m super super, super looking forward to actually recording this is a fun one for me.
So you guys don’t mind smashing that thumbs up it definitely helps out the YouTube channel. Let’s get into this guy. So first off, you in order to see what I want to see is like I guess a button I have to click like a play button.
I go to click that then I have to try to like sign up for something. I’m like, I don’t want to sign up for anything, man. I don’t mind. I know what’s gonna happen. I’m gonna be bombarded with a bunch of emails to like, get behind some sort of paywall for this website, or whatever it is.
And we know this individual is a short seller of Tesla man I’m not trying to give out my JP Morgan reserved palladium card number to any Tesla’s short seller. Okay, that’s just not gonna happen. All right. No way not the Palladium.
Actually, I don’t even have plenty I’m just kidding. Okay. It’s more like the chase business preferred with a 30k limit so don’t get too excited if you find my wallet laying around somewhere okay. 30k limit on that card Okay, so go over to Wall Street bets do your 30k annual options you lose it in a few days and bada boom, Bada bing, okay, have some fun.
Okay, so what is their like, like their bearish thesis or let’s call it the bubble thesis once again, because this person is not just short. They say this is a bubble of bubble Okay, that’s, that’s that’s severe. Okay.
They say I will check back in a year or two after this pop this is going to cause some retail traders to lose fortunes unfortunately to all you delusional fanboys who think Tesla will sustain a 90 RSI on the monthly chart please check back with me in a year after this corrects majorly and sucks out a ton of value from retail Okay.
So basically this person is looking at it from more of a technical perspective than a fundamental perspective. You always know when I talked about Tesla stock I was talking from like a standpoint of the fundamentals where the valuation is having those sorts of things as individuals.
Looking at things like the RSI and technical indicators and basically saying that test was just one big bubble waiting to pop. Okay, interesting. Oh, well wait to get my opinion on this. Let’s go through some comments and I’ll kind of get my opinion on this.
Okay, this individual in the comments they say I measure the trend by applying Elliot wave theory. This entire pop is part of a huge correction that has started in 2014. You would think higher highs are not correction but the current uptrend is a three wave series this stock will be back to $175 when it’s all said and done.
I can’t time the market but I know this uptrend is corrective, okay, now when they say $175 I don’t think they mean 175 from 2200 whatever is that now, I’m assuming what they’re talking about is after the stock splits, which should be in a few days from now right after it splits then the stock going down to 175 Okay.
I think that’s I believe that’s what they’re kind of referring to there which would still be a dramatic fall but there’s big difference between going from 2200 to obviously $175 this comments pretty intriguing okay says yes 100% there are many that feel this stock can only go up like zero in the history of ever.
I exacted my profit at 14 $175 in dem unconcern to see it spiking higher still, a lot of people are planning their retirements around these parabolic gains? I don’t know about that necessarily. Okay. I don’t know.
I mean, I know a lot of people that are invest in a stock and I mean, like, I probably know more people invest in a stock than anybody in the world than those people invest in the stock. And I don’t think anybody’s really like necessarily playing their retirement around, that’s going a little far.
Okay. But, you know, hey, it is what it is. And it’s going to be a massive shock. It doesn’t ascend to 1 billion per share to those folks. They’re not traders or investors, but throwing coins into a wishing well, that seems bottomless so far. But holy Heck, okay. And this person says, it’s not a question of F.
And this I think, believes like the article writer, it’s not a question of if, but rather, when linking this chart upside to Bitcoin in 2017 is scary for those tossing their savings into the asset. I don’t know how to reply with chart pictures, but here, okay.
And basically, they show you know, Tesla stock and then they show a picture of Bitcoin and they basically you know, we see what Bitcoin has done since that massive spike up there. So they’re comparing Tesla to Bitcoin now, okay, now a quote unquote Tesla fanboy or stockholder whenever they respond, they say Western?
Will you still be pointing at this chart when both Bitcoin and telsa are 10x? Their current valuations? Also, cryptocurrency has absolutely nothing to do with Tesla. Seriously, people wanting Tesla to crash and burn will latch on to absolutely anything that supports their wish.
Okay. And I gotta say, you know, that is a decent point there. I mean, you’re talking about a stock with fundamentals with a business model that just did what $25 billion in the past year or so and revenues and should scale to 4060 100 billion just in the next like three four years right versus a cryptocurrency that produces nothing You know.
it’s just it is there are two completely different things I don’t really think they should be compared in my personal opinion, as well in that goes for better or for worse, okay. Weston responds, he says, a bubble chart is a bubble chart, bud.
I’m not comparing them as if they have anything to do with each other. Tesla fanboys will latch on to anything to be butthurt about Oh, fight, fight, fight, fight, fight, fight, then the comeback lesson.
It’s pretty hard to be butthurt owning Tesla stock these days. Oh. Oh my goodness. Okay. Then another comment conversation here, it says seems like you’re butthurt that some people have a different opinion.
No one said that it will continue to grow at this rate or not have a correction check back in 20 years, as far as what is Western have to say that says I had respect for you and tell this reply. Doing the same something something pot and kettle okay.
Interesting. Okay, that was all very entertaining. That was entertainment at its finest folks. Like forget Netflix, forget, you know, ps4 is an Xbox is and, you know, sports, while sports has to happen anyway.
So just forget all that. Okay, that was pure entertainment with the last few minutes we just spent there. Okay. Now my perspective on this, are we is Tesla stock in a bubble or not? Okay, what is my perspective, okay. And in terms of, you know, I need somebody to kind of help me along with this video.
So I’m going to ask my, my, you know, brilliant research analyst, Jennifer, to kind of just give us a little Tesla history lesson if she can, you know, because she’s phenomenal at knowing Tesla history. She’s been tracking the stock, basically, since it went public. So she’s watched it all along its life and it’s just quite interesting.
Okay, so Jennifer made me a few slides here. And let’s kind of go through those. Okay. So if we go back to August 2011. Okay, Tesla’s a $24 stock. Now, when this stock was $24 a share. I can tell you what Jennifer can tell you that this is essentially a stock that was actually considered overvalued that okay, at $24 a share Tesla stock was considered overvalued.
People were like, this is crazy that that company is gonna go BK easily look at they got no money around. They’re taking losses, they aren’t producing anything right now. I mean, it’s some, you know, upstart electric car company, that’s ridiculous.
That even has a $24 stock price in front of it. Okay. And, you know, they looked at the market cap at that time, and a lot of people said that was a bubble then. Okay. And then we fast forward to 2013, the stock went to $193 a share, okay, from $24 to 193. Okay, that’s unbelievable. What is that unlike an 8x, and the stock price is some insane increase in a matter of two years.
And when that stock popped to 193, that was a moment when a lot of Wall Street started talking about this stock. A lot of short, sellers started jumping on board this stock and saying this was an absolute bubble, and this company was destined for failure and the valuation She was ridiculous. And this was like literally like 2013 and 2014 1516.
Those are when a lot of Tesla’s short sellers jumped on the bandwagon and really started trying to beat this one down because they looked at the valuation and what the company was doing and what they expect to do over the next year.
And they said, this is silly. Okay, your stock is destined for failure. Now, what happened? Well, even at its worst point, the stock only went down roughly, like 30%. And so it wasn’t like this crash, the stock like cratered, you know, 50 6070 80% or something like that.
It’s not even close, like literally the worst that ever did was it went down roughly about 30%. From that 190 ish level, okay, which is quite intriguing. So that that massive, you know, collapse in the stock price and never ended up happening. But you know, what did happen?
This stock did almost nothing for six years, okay? Because we can fast forward all the way from basically September 2013, all the way through August of 2019. In the stock price hadn’t hardly moved, right, it was 225 bucks in August of 2019.
I mean, just think about that six years and the stock did almost nothing, it went up some went to 300, then we go back down at 200, and then up to 300 out of the 200 bah bah bah and it was just kind of be like this little roller coasters is riding around doing a whole lot of nothing for six years. Unbelievable, right?
And when it comes to something like this, you got to start thinking, Hmm, maybe this is happening again, with Tesla’s, maybe we’re going to end up in no man’s land for several years out or something like that. And I’ll give my full opinion on kind of this theory as well.
Like could the stock stagnate? Okay, but let’s address the bigger one first, because this is the much bigger one, right? Because these folks are saying, you know, essentially, tests are tests, the shorts are starting to say this stock is gonna do what Bitcoin did in the Bitcoin crash, we’re Bitcoin topped out at 20,000.
Okay. And as bottoms that fell all the way to the 3000 range, right? It was an 80 90% fall in a matter of cheese. I mean, that was even that long, I think it was like a six or 12 month span or something like that was less than a year, I believe for sure.
If we went back and actually looked at a Bitcoin chart in depth from time a hit 20k to time it was in 3000 range, it was less than a year and 80 to 90%. Fall. And that’s what these tests of shorts are starting to say they’re trying to say, test is going to do the same thing.
Just crash to the floor. Okay, my personal opinion on this highly unlikely, highly unlikely that we would see, you know, Tesla’s stock price falls 80 to 90%. In my personal opinion, why is this okay? Well, why no pun intended model y, okay.
You need another reason Model X, you need another reason model three, you need another reason, Model S, you need another reason. What about, what about some solar panels on your roof? Okay, you need another reason?
What about a whole new roof? with solar shingles on it? You need another reason? What about an expanding accessories business? You need another reason What about an app store in the car that is going to start taking off and building into likely one of the most successful app stores.
Especially as this company ramps to 10 million vehicles, 15 million vehicles, 20 million vehicles, because more and more developers will be jumping on this realizing, Oh, my gosh, this huge opportunity here.
And you know, phone apps, so saturated, let’s go on to the next wave. And the next wave is in car entertainment. And Gosh, if this company’s gonna sell 10 million 15 million 20 million plus cars in the future, hmm, might be important to start building apps.
And oh, Tesla will take a cut of that app revenue. Hmm, quite intriguing. Okay, what about Tesla’s service this has always been a huge drag on the business right? All these new cars coming out with warranties and the US market not really being a big thing yet, but what about when all these cars are out there millions 10s of millions of cars are out there right?
And you know, these cars are getting old and they’re being sold you know, used cars and things like that and things are gonna break on him right things break on old cars, things will break Great. Well.
When Tesla service turns from essentially a business that is a losing test of time money, because all the cars are under warranty to a business that starts making Tesla time money, and they start profiting from what happens when that happens. Right.
What happens when the supercharger network has you know, 10 million cars on a fleet 15 2025 30 million cars in a fleet. how profitable will supercharger network end up being okay? What about a company that can just launch a product out of nowhere, that can literally become the most hyped vehicle in the history of mankind?
Like what they did with cybertruck? k? Hmm, I mean, isn’t that kind of amazing, right? No one saw cybertruck coming. In all sudden, in a matter of a few months, this became the most popular talked about vehicle and like the pre ordered vehicle in the history of mankind.
Isn’t that unbelievable? Imagine the numbers cybertruck will do when this comes out. We’re talking we’re dealing with that type of company. Okay? These are things that currencies can’t do. currencies can’t just come out with some game changing product that also starts making billions or 10s of billions of dollars.
Okay, doesn’t happen. What about Tesla Roadster did the day that launches that’s gonna immediately be probably the most popular let’s call it a supercar in the world you’ll end up being Tesla Roadster and an every other supercar you ever liked.
Break below it. Okay, Lamborghinis and Ferraris and everything. Okay, that’s that will be the most popular once that baby gets up and rolling and launch, Okay, what about powerwall? Right? I mean, think about battery packs and actually be able to generate your own electricity from your solar panels and things like that.
and then be able to even sell it back to the grid potentially, and making money from that. Hmm, that, you know, that has some potential there, right? The battery business alone, you know, power walls, batteries in general, you know, massive opportunity.
What about the semi? You know, I mean, how many things do we have to go through for this company? I mean, oh, my goodness, okay. These are things currencies can’t do. Imagine how big the semi business can be for this company over time.
Right? What about the commercial solar business? We know about the commercial battery business, right? I’m gonna sell a ton of batteries to either like big corporations or like cities and things like that.
And but what about commercial solar, that’s a has a massive opportunity. So many companies are trying to move, you know, to solar solar buildings, right? We heard Amazon Amazon’s running commercials all over TV right now, that essentially says that they’re going to be 100% sustainable by 2025.
Okay, if they’re doing that, that means everybody else is gonna have to follow suit, which means, man, you got warehouses and factories and these sorts of things, get better get solar panels on it, what about the fact that Tesla autonomous taxi network is gonna get launched over the next few years?
And you just think about the type of opportunity that is, and how that could actually be a really profitable business model, right? Uber Lyft, those type of companies have always had trouble really making any money from ride sharing. Why?
Because ultimately, at the end of the day, you know, somebody’s got to drive that car around. But man, when all since a robo taxi can do it, you’re talking about the profitability switches a massive way.
I think Tesla’s gonna end up winning this. I mean, really, when I look at it, I think they’re gonna win it. Like, like, how big is that? Like, how big is that market? You know, we just think about that for a moment.
I don’t think anybody’s going to be tested at this game. And I’m hoping that is right. It’s just crazy. Okay. And you think this company’s done, you think they’re not going to let you know, we just went through a bunch of things that are either already launched or are going to launch in the next couple of years, right?
But what about the products? We haven’t seen yet? Right? This Do you think the engineers there and the whole company is just gonna be like, oh, we’re good. We created a bunch of stuff. No, now we don’t know course, they’re gonna come up with new products.
They’re coming out with new services, all these things in the future, their engineers are brilliant. We got we’re fortunate we got a engineer from Tesla actually, in the seven figure club in the private stock group. Okay, he’s been an engineer there.
And since I think it was 2014, I actually got to have a phone conversation with this individual. This week, brilliant guy, absolute brilliant guy. And we’re fortunate where he’s actually gonna do some coaching.
For us for some of our new students in the private group, which I’m super thankful for. brilliant guy, I mean, absolute brilliant guy. And, you know, imagine they got, you know, teams and teams of these, you know, high level thinkers.
High level engineers, you know, I mean, imagine how many great engineers are at Tesla, working around the clock, just trying to figure out things, you know, a better way to do this better way to do that. I mean, it’s absolutely ridiculous.
And so when it comes to stock market, anything is possible. But you know, it’s very hard for me to imagine from here, tufts of stock falls at 90%, or anywhere remotely close to those type of numbers, you know, like Bitcoin did, let’s just put that way, because it is two completely different things.
Okay. But let’s talk about the the more let’s call it realistic situation, which could this stock go stagnant for five, six years, something like that? Right, which is what we’ve seen happening in stock before, you know, the valuation when crazy on it six years ago, right?
Yeah, I mean, just crazy. And then it didn’t do anything for years. Now, the valuation to a lot of people’s opinion has gone crazy on the stock, are we setting ourselves up for another five, six year period? Okay.
And I can say, maybe, potentially, for this, maybe the I mean, the market cap is huge now is a 400 billion plus dollar mark cap, there’s no way you can justify what Tesla’s doing today versus that market cap, right?
There’s no way but let’s play devil’s advocate for a minute. Let’s start looking at this a little differently, right. So if we go back to 2017, this company lost nearly $2 billion on the bottom line, okay.
I mean, imagine that a net loss of almost $2 billion in a year, versus the last trailing 12 months, this company has made a profit of $368 million. This business model in the last few years went from taking a $2 billion loss to now being profitable.
This is a massive switch in the business model, okay. But not only that, what do they think is about to happen over the next several years, is this company’s going to get in a position where they can start doubling up, doubling up doubling up doubling up net income almost year in year out unless they have a huge investment year or something like that.
Where they have To spend crazy money on something, okay, for instance, I think that next year, okay 2021, this company should easily be able to pull in a billion dollars of net income. And I mean easily, okay, well say you never really know.
And you never know how this Ronnie Rona situation is going to go. And all those sorts of sorts of things. But I mean, just seeing the company, you know, get to the levels, they’re at in this whole ugly experience. That is the Roni Ronan’s situation, right?
I have full faith, full thing based upon the type of revenue numbers, I expect this company next year, that they will be able to get to a place where they have $1 billion plus bottom line net income next year, okay.
But what happens when the following year they go to 2 billion, and they double that up, and the next year, they go to 4 billion and the double that up and the next year, they go to 8 billion and they’re having this exponential increases, which when you run the revenue numbers at this company should be increasing to in 2021 2022 2023 2024.
It’s no hard to imagine these type of net incomes. And what happens when five years out, they got 16 billion possibly on that bottom line, right. And let’s say that exponential, like double up double up double up of net income each and every year, right?
Let’s say that slows down, and then they only go up to 24 billion. And then let’s say they only increase 6 billion next year, and there are 30 billion still, I mean, even then the profits pour into this business or ridiculous, okay.
And so when you look at this from more of a longer term perspective, all sudden, you start to realize these numbers, and especially if this company can get to a place where they’re pulling in hundreds of billions of dollars of revenue, which you know, some people say in seven, eight years.
It’s definitely, you know, realistic possibility for this company, based upon where the business will be at. I mean, think about where Tesla was seven or eight years ago, compared to where it’s at now. I mean, it’s you can’t even compare it, it was a joke, right?
Nelson, it’s like that company that everybody’s taking serious, finally, but people are saying, well, maybe it’s overvalued, and it’s like, look at the exponential increases that are likely gonna happen for this company, when it comes to revenues and profits and everything across the board over the next several years.
And this is something we’ve seen before this is Amazon all over again. Okay. I really think there’s only one company in the world, you should compare to Amazon. One, and that’s Tesla. And that’s it. Okay.
And Amazon’s a type of company, they’ve always been able to get away with a massive valuation on the business model. And if you look at Amazon, anytime in the past, okay, the valuation never made sense for where that business model was at at that present time, or even where the business model was at. And then the next year, okay, even right now.
I mean, Amazon has got a $1.7 trillion market cap on it, there’s no way you can justify that based upon what the company is doing now, well, so you go ahead, and you start running numbers on what they’re going to likely be doing in three years from now, five years from now, seven years from now.
So you’re like, well, 1.7 trillion is not bad at all, in this company’s always been able to get away with that, because it always had this exponential growth behind them, this growth engine, and that’s just kind of atmosphere of the company of growth, growth, growth, scale, business skill of business. And this is this is, you know, Tesla is Amazon 2.0, very different businesses.
All those sorts of things. But they’re the only two businesses I can put into that same category. Okay? The only the only other business, I’ve never seen another business in my 12 years being the stock market that compared to Amazon, and its tasks at the end of the day, it’s that company, because they’re just they run similarly.
They don’t care about short term profits, they’re going to scale the business, they’re going to focus mostly on ramping revenues, taking market share, and making sure they’re relevant 10 years from now, 15 years from now, 20 years from now, and much more relevant than they are today.
It’s Amazon 2.0. And so when I look at it from that perspective, as a long term investor in this company, I’m not worried at all, if a stock goes down fine, it doesn’t still be up massively. I mean, if the stock could go down, 50%, I would still be up massively.
Now I do worry about it from the perspective anybody’s trying to short term trade it and trying to buy at 2200 and hoping it goes to 25 3000 I don’t like that activity, I’ll be honest, I don’t like that activity at all. And I don’t like to see that.
And that’s the type of stuff that worries me. But at the end of the day, if you’re just playing this because you’re just playing for short term trading, you know, you’re gambling money anyways, you know.
You’re just instead of going to Vegas where I live, right, and you go on the strip and you roll the dice you play the slot or, or you know, you’ve played blackjack instead that you’re deciding you want to gamble on this stock and, and buying a 2200 and hope it goes to 2500 and sell out and then maybe it goes down to 2400 no buyback, and then I’ll go 2600 You know.
You’re just gambling and then if that’s what you want to do, that’s what you want to do. But as a long term investor, you know, it’s all good with me, if this stock stagnates for a few years, I’m fine with that.
If the stock goes down a bunch, I’m fine with it as well. But in terms of you know, comparing this to Bitcoin, saying it’s a bubble, it will go down at 90%. And that’s where I say, you might be getting a little bit confused there in my opinion.
So hope you guys enjoyed today’s video. As always, if you don’t mind, smash that thumbs up button that helps out the YouTube channel in a massive, massive way. And also, if you’re looking to scale your stock market portfolio to six figures, seven figures, even eight figures in the future.
Check out the first link in down there in the description that should help you out tremendously, you’ll be able to apply, hopefully get on a phone call. Somebody hired from my team we can tell you a little bit about financial fortress and how that can help you out. Thank you for watching and have a great day.