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Tesla could go bust, a hedge fund manager warns

Published 04/03/2024, 09:24 AM
Updated 04/03/2024, 09:24 AM
© Reuters.

For some, Tesla (NASDAQ:TSLA) is the electric vehicle (EV) market king and Tesla’s stock is experiencing a downturn due to industry headwinds. However, there are some bears who believe the stock is in a bubble.

In fact, one hedge fund manager recently told CNBC that Tesla “could go bust.”

Tesla stock could go bust - hedge fund manager

The publication revealed in an article Wednesday that Per Lekander, a hedge fund manager who has been shorting the electric vehicle company since 2020, said, following Tesla’s 386,810 vehicle deliveries in the first quarter, that “this was really the beginning of the end of the Tesla bubble.”

Lekander, a managing partner at Clean Energy Transition and a former portfolio manager at Lansdowne Partners, told CNBC’s Squawk Box Europe that Tesla was “probably, arguably was the biggest stock market bubble in modern history.”

Lekander added: “I actually think the company could go bust.”

It’s not the first time that Lekander has said Tesla shares will fall, saying the stock will decline back in March 2021, when it was close to $233 per share. It continued from that level to above $400 later in the year.

In addition, CNBC notes that Lekander has taken his call for a Tesla stock decline further, indicating the stock could tumble to $14 per share based on an estimate that Tesla’s full-year earnings per share this year would be $1.40.

He has described Tesla as a “no growth” stock.

Lekander’s reasons for his bearish call include Tesla’s business model, which he said has been based on solid revenue growth, vertical integration and direct-to-consumer sales. While he notes the model is “brilliant” when a company grows, he believes it goes in “reverse” when sales fall.

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Furthermore, he believes Tesla’s issues are a demand problem, not supply chain disruption, and he doesn’t see any reason “to see any recovery over the next two years.”

Tesla stock falls after soft deliveries

Tesla posted its first-quarter delivery numbers this week, falling short of analyst expectations, which caused the stock to decline.

The electric vehicle giant revealed it delivered 386,810 vehicles, below the estimated 449,080, according to Bloomberg consensus. Model 3 and Model Y deliveries came in at 369,783, marking a 10% year-over-year decline, which was also below the expected 426,940 units.

Meanwhile, quarterly production hit 433,371 vehicles, below an anticipated 452,976. Model 3/Y made up 412,376 of that total, again falling short of the 439,194 forecast.

The decline in volumes was “partially due to the early phase of the production ramp of the updated Model 3 at our Fremont factory and factory shutdowns resulting from shipping diversions caused by the Red Sea conflict and an arson attack at Gigafactory Berlin,” Tesla stated.

The electric vehicle giant also said it managed to deploy 4,053 MWh of energy storage products during the quarter.

Latest comments

The Goblins are frothing at the mouth 🤣🤣🤣
You know a stock is very close to a bottom when the hedge fund managers talk it down, so they can build a position on the cheap...
LOL! Well at least they're up front that the doomsday sayer likes to Short Tesla. Of course he has nothing but negative things to say.
Dumb articles like this makes me read news on other apps.
Buy signal, thank you.
Tesla is a great company, but Elon has lost focus. China’s economy is in trouble. Rental car companies have stopped buying Tasla’s and have sold thousands of them at low prices. Competition is heating up and most cars Are overstocked on car lots right now. Tesla is dropping prices. Until interest rates come down Tesla stock will not outperform like in the past. Hybrid cars are more cost effective, such as Toyota’s RAV4 which hold their value better and are cheaper to service. I will Buy Tesla stock again but at lower prices in the months to come. NVDA stock will outperform Tesla at this point. Tesla is a great company but its stock price is in trouble until rates start dropping and their is a soft landing for the economy.
Apple
The fund manager is a joke. If you followed him back in 2020- you would have blown up your account many times over. On topnof that- its be a striaght up weasel with his statments.
What a crock!
Bets this guy's firm goes bust before TSLA?
He wsnts to cover his short at lowest price so he wants every one to dump and he can buy
Goldman says 300 by years end...
Lmao, and what did they say about housing market in 2007v
This is the biggest fake news headline ever. Tesla is not just a car manufacturer people.
I meant to say full self driving in another couple months probably it's nearly solved now with 12.3.3 version
and I meant to say Hawaii just shut down its last coal plant I couldn't go in and edit this so I had to post again
and some of the recent Texas brownouts could have been solved with mega packs, so not just a car company my friend this stock getting hammered it's due to ignorance
Manacava la kaxxata del giorno!!!!
😂😂😂😂
Guys, I’m shorting this stock called TSLA. Let me tell everyone hows it going go go BUST so I can laugh to the bank. How many hedge managers does it take to screw in a lightbulb?
They can't screw in a bulb because they don't know which way to turn.
Interesting... The hedge fund manager stands to benefit financially if Tesla were to fail, and he's predicting exactly that outcome. Hmm... Something seems suspicious here. Hold on a moment!
Buy TSLA. Sell AAPL. AAPL is losing market share and the trend will intensify.
Apple is cash king and paying solid dividend, Tesla is like a dvd player maker in US competing with cheap china DVD player. Space X is brilliant but it is all privately owned by Elon.
Climate lies coming home to roost
More like US shouldn't tarde war with China... they'll build their own and flood markets with cheaper equivalents
europian solid auto producers will kick tesla out of the world market
Another Hedge Fund manager on crack.
Who would listen to someone named Per? Lol
Amazon COULD go bust, Google COULD go bust, Microsoft COULD go bust. To whom should I send my invoice for sharing this insightful news?
EV's all take too long to charge, suffer range drops in cold weather, have inadequate charging stations and are all powered by fossil fuels. Buyers are enthusiasts and dreamers, and this market feels like it's already saturated.
urrr, not sure that's how the math works.....a normal car use 100% fossile fuel, a electric car us 100% electricity, of which 60% is generated by fossil fuel.....regardless who much less overal energy electric car used compare to normal car, the 60% fossil fuel mix for electric car is still 60%
ok dinosaur
John, if all they've got is age related in/sults, I'd say you are winning the argument.
Tesla is a great company. the share price just reflects it being twice as good as it actually is
just buying time to exit this folks, for sure they lost their buy position, they want the stock to go up..REMEMBER, its not only tesla doing EV products, a lot now and a lot..competition starts your tesla will gradually tank, just like sales...
This is what happens when a very over priced share looses popularity. the bubble eventually deflates
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