00:00 Josh
Great story, interesting trend. Why are institutions selling Tesla while retail is piling in, Proz? What what’s going on here? Who do we think is right?
00:19 Pras
a tug of war, right? between the Bulls and the bears. But in this case, the bulls are retail and the bears are institutional money. So in the article, talk about, uh, sorry, the little Alexis going off here. Um, UBS, you know, cut its stake by 60 million shares, right? Uh you have Nomura selling 80% of their position, selling it off. Goldman cutting it safe. Morgan Stanley also cutting it safe, but also they’re one of the biggest shareholders of of Tesla. So you’re seeing these guys sort of in some cases, almost liquidating, in other cases just taking some money off the table. They probably see some rough sort of, you know, kind of uh rough period ahead for the stock as Tesla sort of, you know, converts itself from an auto company to a tech AI uh self-driving company. I think that the institutional money is maybe taking a more cautious approach here.
01:21 Josh
And why do you think retail is piling in, Proz? What what do you think’s motivating that? Is that because, yes, they are all in on the Musk vision. This is going to be the AI robot, robo taxi leader, or no, they’re they’re chasing a trade. What do you see in the data?
01:52 Pras
So, uh, JP Morgan today came out with some data, or essentially last night about what’s happening with retail there and how and how they’re sort of the theory is that retail is sort of finding refuge away from other traditional AI names and software stocks that have been getting slammed and plowing plowing into what? Nvidia, Amazon, Microsoft, Tesla, uh, sort of the Mag 7 names, the return of those guys. Uh basically, they said that uh last week from February 12th to the 18th, then retail plowed in 326 million into Tesla stock, uh ahead of uh of of of other of some of those big Mag 7 names. And year to date, Tesla is the second most retail uh investor focused bought stock only behind Microsoft, right? And then and then ahead of Nvidia, Amazon, and Netflix per JP Morgan’s data. So retail is sort of, like you said, buying into that vision, that Musk vision of, hey, we’re we’re all aboard on the AI Robo taxi trade, but we’re okay with accepting some volatility on the way.
03:00 Josh
I’ll end here, Proz. Let’s say I’m a retail investor. I’m watching this right now. Maybe I just piled into Tesla, okay? What would you say the key signs, sign posts, financial metrics are that I should have on my radar for over the next six months, 12 months.
03:26 Pras
If you asking me for fundamental reasons to buy Tesla stock?
03:29 Josh
I’m asking what’s on the Proz radar as a the Tesla Pro that you are.
03:38 Pras
I I only say that as a joke because we we know Tesla investors are not necessarily trading on fundamentals, right? So what are they trading on? You’re exactly right. They’re trading on, when are we going to hear more about safety drivers leaving the robo taxis in in Austin, right? We’ve only heard a couple of them leave, right? They want more information on that. They want more information on Optimus. We’re supposed to see Optimus version 3 in April, right? So these are product focused sort of things that they think will drive the stock. Uh another one, Josh, that I mentioned, look, there’s also the SpaceX factor, right? You have an unlocking of SpaceX. Retail can finally buy a piece of that in the summer potentially. Maybe there’s a connection with Tesla, maybe there’s sort of, are they going to not, I’m not saying there’s going to be a merger, but maybe there’ll be a special offering for Tesla shareholders, maybe you want to get into Tesla ahead of time. You know, you never know with Musk, right? You know he wants to consolidate that power and I think it’s a lot of that Musk person, the cult of personality. That’s what the really hardcore Tesla investors are looking at. What will we will the company offer from both a product point of view, but from a Musk point of view? It’s not really about, hey, that PE ratio is is only now only about 400. That’s a good buy.
04:54 Josh
Yeah, your point is well taken, Proz. Listen, I’ll have Tesla investors sometimes on the show. I don’t mean, you know, I don’t mean financial analysts who cover the stock. I mean, you know, shareholders. And you know, I’ll try to get them talking about like EVs, what’s driving the P&L. They don’t want to bite. I’m not in it for that. Robots, dude. That’s why I’m in. That’s why I’m in.
05:27 Pras
And and real quick, Josh, you know, we we joke around about it, but also look, Tesla Energy’s a big business, right? That’s something to to a key thing to watch there. You have other other services, software services, other things that actually make money for Tesla, uh charging, right? That’s one thing. So, maybe there’s other reasons why to own the stock, but right now it’s not about that, right?
05:54 Josh
Pras, as always. Thanks, buddy. Appreciate it.
05:57 Pras
Thank you.