OUT of Tesla Stock....

Well, it looks like some big Tesla bulls are done with Tesla and didn't just trim their position, didn't cut it in half, but actually sold it all. So maybe it's time to finally sell your Tesla stock and I'll give you my scenarios for when I will consider selling Tesla stock. So let's discuss all that today. You guys know it. You're going to get the truth about the hype. Just make sure you like the video. If you like getting that truth about the hype, I know the setup's different here. I apologize. I'm actually on the road here in Asia. We had some group events out here and I'm also here looking at some other business things that I have working as well. Not really related to YouTube at all. So that's why everything looks different, but got to bring you guys content. So here we are. Obviously, as I'm sure a lot of you guys know, Gary Black sold completely out of his Tesla stock altogether. And I'll be honest with you guys, we'll go over exactly why he sold. And some of it, I agree with some of it. I don't agree with at all, but let's kind of talk about it here. Get into it. He actually sold for four key reasons or at least he gave four key reasons for selling the stock there. We'll go over each one of those. And then I'll give you the two scenarios where I personally would consider selling Tesla stock. So reason number one, valuation concerns. All right. So this one upfront, if I'm being honest with you guys, I got to agree with them. I think we all have valuation concerns and no Tesla doesn't always trade excessively overvalued like it is right now. That is simply not true. You can go back and pull the charts and look and see, and it is traded a much lower multiple just last year. So to say Tesla always trades like this, honestly, isn't true. And I would agree. It's definitely a rollercoaster up and down, right? It seems like we're overvalued, then we're undervalued, then we're overvalued again. We kind of tend to flow back and forth between all that. But for right now, currently can't argue. It's overvalued by every single metric and it's not close now to be clear, we are not 2021 overvalued. So I'm not even saying we're in that stratosphere. That was a whole different stratosphere altogether, but we are not to that level. But to say he doesn't have some legitimate concerns with valuation, it's just simply not true. There's absolutely valuation concerns and no matter what metric you pull, you can pull them all. It is significantly overvalued. So reason number two, continued erosion and deliveries. I kind of danced around just to touch with this one right here, but the bottom line was he thinks deliveries and overall execution are going to continue to erode for the rest of the year there. And again, that's exactly what's been happening for more than a year. Does that continue, especially with the launch of the new model? Who knows? But even if you disagree with the fact that, I don't think it's good deliveries are going to continue to erode. Okay. That might very well be true, but do you see them really accelerating in any meaningful way for the rest of the year? Now, obviously maybe the new model we'll do some of that. I don't know, but that's definitely not something like in the past where we just predictably knew that it was going to be a, you know, every quarter was going to be a record number of deliveries. That delivery number was going to continue to accelerate forward. I don't think anybody's arguing that we're not in that spot right now. And we're not in that spot right now. So although I may not think we might see continued erosion in deliveries, I definitely don't think anybody's being unfair in saying stagnation of deliveries is absolutely on the table. And you're more likely to have an erosion in deliveries, like he mentioned versus an acceleration in deliveries. If I had to bet on one of the two, boy, that right there becomes a much more juicy bet to bet on. Reason number three, did not like the risk reward with RoboTaxi. Now with this one, I'm going to disagree with Gary Black on it. However, having said that, probably not going to make the bulls happy either. I don't think that the risk reward with RoboTaxi and we're trying to roll it out is that bad. I mean, what it's already not delivering anything to the bottom line. I personally feel it's not going to deliver anything to the bottom line for years. Significant. I understand some of you guys will jump in the comments and say, oh my gosh, it's going to add trillions one day. Yes, but we're not talking about one day we're talking about here in the next year, two years or so. And I don't believe it's going to deliver anything meaningful to the bottom line. So for me, I really don't see a high risk reward here because it's not really, I'm not really counting on it, adding anything to it. So I would much rather be working out a lot of those problems, come across some of the issues that you're going to see now versus one of the people actually expect revenue and actual bottom line profits from it. Now I know some of those Tesla bulls with crazy price targets are just expecting gobs and gobs and gobs of money coming in at that stage. And therefore next year, we're going to have another trillion dollars worth of revenue or whatever, all the craziness that gets set out there does. But if you have a very reasonable expectation for this taking the appropriate amount of time to get right, grow, scale, and then start adding to that bottom line. At that stage, to me, the risk is very, very low in regards to this. Get out there and make the mistakes, make the improvements, get it out there in the real world, get people comfortable with it. All those sorts of things to me are all barriers you're going to have to cross anyways. You might as well do them right now when the expectation is much lower in regards to revenue profits and things of that nature. As opposed to the closer we get to that actually becoming a reality, the more that expectation of a lot of revenue, a lot faster is going to be kind of the norm across the board, not just with the Tesla ultra bulls out there. And number four, the stripped down model Y. There was massive excitement whenever it was a new model that's coming. But like we discussed back then, more than a year and a half ago, if it doesn't deliver a new model altogether, and it truly is a stripped down version, it's going to disappoint analysts and they're going to sour on the product itself. Now, if Tesla can deliver anything at a little bit of a lower cost, I don't really care. Okay, cool. You know, happens to be a stripped down model Y, happens to be a new vehicle altogether. I don't really care at that particular stage, as long as you're getting that lower price point, which is where I think Tesla is going to thrive in those lower price points and absolutely be able to squeeze the maximum amount of margin compared to everybody else out there. If that's the first step in getting into that market, I'm a-okay with that. It doesn't bother me at all. So this one right here, I'm going to have to completely disagree on because I don't see it as nearly as big of a negative as he is. Now, again, that doesn't mean that I didn't say analysts wouldn't be disappointed. I absolutely thought so. Of course, I would prefer to have a new vehicle altogether. I think that would have been even better, of course, but I also don't think this is a reason to sell a Tesla stock at all because I think it's going to do well regardless, especially if they're able to move that price down enough into that next tier down, that would be a huge boon for Tesla. That may be the one thing that can actually flip deliveries back to the right direction up, which of course I think we would all like to see. I know a lot of folks like to say it's more than a car company. I like good stuff. I agree, but we're talking about earnings and stock investing here and over 80% comes from those deliveries. So right now, maybe 10 years from now, that's completely different, but right now and for the foreseeable future, which we know you can't predict out past a couple of years, it is absolutely critical that deliveries start to accelerate again and start moving in the right direction. Oh, I told you guys, there's actually two scenarios why I would consider selling Tesla stock or really any stock for that matter. So let's go over those next. So the first one is the stock gets caught up in a hype run. Now, when I speak about this, I don't mean your typical up and down movements with Tesla. It happens all the time, right? It seems to like, you know, last year run all the way down to 140 or so, I believe is where I bought shares at. And then it would run all the way up to $280 or so, and then back down. And of course we got up over 300, up over 400 at the beginning of the year here. I'm not talking about runs like that. Although whenever it got up over 400, obviously that was really, really heated, but that was nothing like 2021. That was a time where, yeah, I probably should have sold. I did say, Hey, I'm not buying it. I have no interest in it. You know, beyond $200 at that stage, obviously I didn't sell any shares guys. All those folks out there saying I'm a bear or whatever the case was. No, I just felt that was severely over at $400 per share and a multiple of over a thousand, which was just insanity. Um, you know, crazy, crazy high in hindsight, I should have sold. I should have now, of course you can't live in hindsight. So that's okay. All I did was continue to stack cheap shares, which is what you do as an investor. If you want to own a great stock longterm, you just continue to stack those shares whenever they get undervalued or just keep right on going along with your DCA. But for me, personally, if I saw that style run again and Tesla stock, and I saw that, you know, that multiple creep up over 500, 600, 800. I mean, at some point in time for me personally, I know that stock is going to either fall down or it's going to stay right at that level, but it's going to trade flat for years. Again, everybody thought I was crazy in 2021 when I said it, and that's exactly how it played out. So if that happened again, I would absolutely sell my Tesla shares. Now, of course the perfect scenario is that never happens and never gets that crazy overvalued. Therefore you just lay off buying shares and then you buy the shares. And then you just continue to hold the position as the company continues to execute underneath. That's how you make your money in the stock market over the long run. So I don't want to see that happen personally. You know, it's just not something that I want to see. I just want to hold and continue to add on the dips like I always do. And number two, something fundamentally changed with this stock. All right. I'm talking about fundamental changes here with the stock. Hey, Elon leaves altogether. I understand you can kind of say you kind of did that recently here, but I'm talking ousted or just decided to go leave and go work at SpaceX full-time. Whatever the case was at that stage, something like that, a significant law change, a significant regulation change that makes EVs basically impractical at this stage or impossible to use. That could be something that would create a scenario where that's a fundamental change to me, obviously being disrupted. I understand EVs are at the front of disruption there, but in the scenario where they're somehow disrupted significantly, that can absolutely be a fundamental change with the business. And you could make an argument in a case that, Hey, Elon getting involved with politics and everything else that could have been a fundamental change as well. That could very well be true, but that's been going on for a long time here. So whenever you got that big run up over Christmas break there at the beginning of the year, this year, that would have probably been the time to sell. If you felt that politics was truly a fundamental change with the stock there again, this one was very unique situation was very unique. So it definitely had a little more nuance than the normal nuance that we have in a scenario like that. But nonetheless, that could very well be a fundamental change for you. And of course, if something changes with your thesis significantly, like for instance, let's say you felt the robot taxi was the end all be all. That was the reason why you own Tesla stock. Well, if robot taxi fails or FSD doesn't get solved or some other law or something else changes to where, Hey, that's just not going to be allowed. That's not going to be something that governments are going to allow happen. That right there, obviously would be a big fundamental change at that stage. I would definitely consider selling the stock, but for me right now, nothing has fundamentally changed with Tesla. The valuation is not crazy. It is very high. It is very rich. Do not get me wrong, but it's not so crazy. It's not in that height cycle. You know, think a wall street bets type cycle to where I would worry about it or think about it. I'm just not right now. I mean, we're not even close to those levels yet. I have no reason to sell all my Tesla stock at this particular stage. I'm going to continue to hold and see exactly what happens. And if you want to learn exactly how to do evaluation, how to do diligence on a stock, be able to analyze the stock, be able to see my complete watch list for price targets, see all my bonds, all it's in real time. Get your free coaching, get your free courses. Guys, there's so much involved in a membership. For those of you guys that stuck around, I may have left something special down in the pen comment for you and click this video here. If you want to see exactly what I'm buying in this market and click here to see my exact plan for this market. So thanks for watching and we'll see you in the next one.