What I *JUST* Said on TV about Twitter, Elon Musk, and Tesla.

well it actually happened elon musk has

pulled off what many thought would be

impossible he reached a deal to acquire

twitter and it cost him a cool 44

billion dollars i was just a little

short in my bid i think lindsay rent me

a few dollars but we were a little short

on it like five bucks

you know all right we're here to break

it all down and to talk about what and

how that all transpired is youtube

sensation meet kevin kevin it's great to

have you back on the show on this big

day

um you know last time you were here you

suggested that twitter should counter

offer it looks as though they kind of

realize hey this is a pretty good offer

54 bucks and 20 cents a share so

what do you think made them take the

deal

and why do you think that they reversed

course and at least according to

conventional wisdom

yeah absolutely thank you so much for

having me again as well look here's the

thing when you're negotiating and you're

backed into a corner the first thing you

do is look for other opportunities but

if there are no other opportunities you

go with what you've got because if they

didn't go for elon's offer they would

have been exposed to massive shareholder

lawsuits here's why elon is paying

75.2 times 2022 earnings for twitter

that's substantial because if you

compare that to netflix google facebook

or many other companies that have a

similar growth trajectory of around 15

to 20

we're only paying 20 times earnings for

those companies in the stock market

right now that means elon's potentially

paying as much as 3x for this company

he's giving them a great deal and it was

very smart of them to take it and it's a

win for free speech

okay so the company is going to continue

to be publicly traded until the deal is

final which actually might even be today

or tomorrow what does this mean for

shareholders should people be buying

twitter right now so that deal is final

or should they be divesting what's the

advice

yeah that's a great question so here's

the thing the buyout price would be a

54-20 but there are risks you could have

the ftc you could have the sec you could

have the biden administration a lot of

things could step in here and really

mess things up for twitter the stock

right now is trading for about a four

percent discount that means if you

invest the deal goes through maybe your

upside is four percent but if the deal

fails your downside could be fifty

percent for me it's not worth it if the

company's going public or if it's going

private it's it's not something i would

touch if i had shares i would sell them

somebody did donate one share to me so i

do hold just one share

hey kevin so you said it's a good deal

for twitter and i agree with you totally

like

it's well above all of the smart things

that you said was it a good deal for

elon musk because right now you're

seeing a lot of folks say particularly

on the left that they're going to leave

so did he make a good deal

but he did something phenomenal

for society he is a fighting force for

free speech and bringing us an open

source source algorithm that means

people can see the code and see what the

software is doing it's really uh

potentially a way of showing the world

how ai can actually work and if you

think about it it's actually kind of a

sneaky benefit for tesla because if

people see how great the algorithm will

work in the future under elon at twitter

it's going to move the market cap of a

company like tesla and given that tesla

is worth over 25 times what twitter is

worth that elon's gonna make more than

his money back he definitely overpaid

for this company but i think with his

changes he'll also make money on twitter

okay this was such a controversial move

like sean mentioned because of free

speech so how does this disrupt the

market for places other platforms like

true social or something like that

yeah truth social had some problems

today so truth social was down about 12

and a half percent after the deal was

announced and this also came at about

the same time that we heard that trump

had only been on the platform once in

the last two months not really good uh

really i think there's a lot of hope

that maybe trump will just come back to

sort of elon's twitter which right now

it seems like might not happen hopefully

it does but we just want folks

ultimately to feel like they they don't

have to self-censor themselves or be

fearful of getting banned i think that's

what everybody really wants uh

internationally for uh for uh prevention

of censorship and that's really what

elon's doing here because that's a big

thing is a lot of folks complain that

they're worried about even saying what

their opinion is because they're worried

they'll just get banned

and i can imagine that under an elon

musk run twitter folks won't have that

fear anymore and it is a win for

democracy unlike what elizabeth warren

and folks on the left say which is

ridiculous elizabeth warren just tweeted

that this is dangerous for democracy

i'll tell you what's dangerous it's the

ceo of twitter getting 42 million

dollars if he gets fired by elon musk

that's broken so you suck at your job

and you get 42 million as a payday if

you're fired that's

dangerous that no i'll i'll take 42

million dollars get fired um hey real

quick before we go it is okay as quick

as possible on earnings come out for

twitter on thursday real quick how does

that change anything

i don't think this really affects

earnings i think people are going to

look right through earnings again you've

got a four percent upside right now 50

downside if the deal doesn't go through

it doesn't make sense for the stock to

really run past 54 20 because that's

what you're gonna get paid uh if the

deal does go through right so you're

upside super limited downside's huge

fantastic as always kevin you bring

common sense to very complicated things

thank you as always

thank you for having me