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One longtime Tesla (TSLA) shareholder is looking for a reason to believe in a company taking on fire from all sides.
But he admits that it's getting tough to stay a believer in Elon Musk's electric vehicle maker.
"[I] fear that Tesla's best days are behind it," Gerber Kawasaki Wealth & Investment Management CEO Ross Gerber told Yahoo Finance executive editor Brian Sozzi on the Opening Bid podcast (watch video above or listen below).
Gerber said he recently slashed his stake in Tesla to 266,000 shares, valued at around $50 million. Last year, he owned a reported 420,000 shares and was more of a Tesla optimist.
The very active poster on X, formerly Twitter, says he invested heavily in Tesla in 2018 and 2019. At the time, “things were really tough. I stuck by [Elon Musk] and invested money when nobody else would,” he said. “It paid off for me.”
But that was then, and since, Musk has taken to calling Gerber an "idiot" on X for voicing frequent concerns about the company's business.
As Musk has pivoted toward building humanoid robots at Tesla, reviving X, and launching rockets via SpaceX, Gerber is worried the billionaire is leaving opportunities on the table at Tesla — at the risk of Tesla shareholders such as himself.
“Elon is not focused on building Tesla,” Gerber said.
Meanwhile, the fundamentals of Tesla have taken a turn for the worse.
In late July, the company reported second quarter results that included an earnings miss while revenue exceeded expectations. Vehicle deliveries came in at 440,000, only slightly above consensus.
Gerber believes Tesla is in for a few more challenging quarters.
The used car market is presently “flooded” with languishing Teslas because the “CEO now owns [X],” Gerber warned.
Tesla shares are trading at $213, down from the 52-week high of $278.98 but higher than the low of $138.80 during that same period.
Not helping sentiment on Tesla's stock is Musk's pivot to support former President Donald Trump.
Musk’s close-knit status with Trump is doing the company few favors, Gerber said, referring to Trump as “the worst thing for Tesla you could ask for” since he won’t help sell cars.
Trump’s proposed policies, such as repealing the $7,500 EV tax credit and supporting the oil industry, are in opposition “to the concept of what Tesla is,” said Gerber, adding that if Musk were to get a cabinet position in a second Trump administration, “it would be because of Twitter."
Musk and Trump “want to control the narrative on Twitter,” he said. “That’s why they have a relationship.”
To be sure, Musk and Tesla still have an intensely loyal retail investor base unshaken by volatile news of the day.
“I’m very convinced this [stock] goes to $5,000 or $10,000 [long-term] once people understand what Tesla is all about,” retail investor and Tesla shareholder Alexandra Merz said on Opening Bid. Merz is a former financial adviser and current CEO of L&F Investor Services.
To Merz, Tesla's stock remains undervalued for two main reasons.
First, the market is not properly pricing in the company's earnings power from the widespread adoption of its Optimus humanoid robots over time.
These robots have their doubters, including former Meta head of AI Jerome Pesenti. "Sometimes we have to call it what it is, right? I mean, have you seen this [robot] thing do anything? It's bulls**t," Pesenti said on Opening Bid.
Second, Tesla's AI is a competitive advantage that can widen its moat against car rivals such as General Motors (GM).
Gerber thinks the belief in Tesla's Optimus robot is overdone and shouldn't play a factor in a rational analysis of the stock.
“The last thing I need is some robot built by Elon Musk in my house,” Gerber added.
Three times each week, Yahoo Finance Executive Editor Brian Sozzi fields insight-filled conversations and chats with the biggest names in business and markets on Opening Bid. Find more episodes on our video hub or watch on your preferred streaming service.
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