the morning after... my honest take

okay so what do we make of a Tesla well

in this video I'm going to start by

showing you an interview uh that I just

did with Yahoo finance to give you my

reaction after being able to uh digest

what happened with Tesla over the last

24 hours I want to give a heads up I I

think Elon did a fantastic job he gave a

lot of Hope when sentiment was at bottom

and that's very exciting and it's

optimistic the future is so great for

Tesla I love Tesla and I I believe in

EVs and and energy and solar I believe

in all of that I I'm not sure and I'm

conflicted though on the path and the

actual Clarity that we got for the next

year 2 3 four 5 years I I still think

the next 5 years have tremendous

uncertainty and you're going to see why

in this interview uh and then we'll come

back at the end of the interview and

I'll give you some additional thoughts

quick note check out this video clip

from our how oack Road Show in San Jose

it's amazing we had such a great turnout

in the venture capital capital of the

world is so freaking cool and if you

want to come to the road shows remember

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2024 well Tesla out with first quarter

results clocking its first Revenue drop

in four years the EV maker reported both

a revenue and earnings Miss but the

stock is soaring today after the company

said it would accelerate the launch of

more affordable Vehicles despite today's

pop the stock right now down over 30%

this year and it's becoming popular in

the options Market Tesla short interest

is up 30% from the beginning of the year

here with more we've got Kevin paath who

is known as well as the popular YouTuber

meet Kevin and a long-standing Tesla

retail shareholder as well uh if if my

memory distes me correctly as of uh this

morning you've also trimmed your

position recently take us into that

decision making

Kevin yeah absolutely thank you so much

for having me by the way so uh what I

did before earnings and before we got

our q1 deliveries numbers is I thought

this would be a perfect time to tax loss

Harvest some of those higher

Acquisitions of Tesla shares so I sold

down in March up to uh the earnings uh

which we just had yesterday uh and so

now the debate is is it time to Reby

Tesla and I think investors should be

looking at three good things that we

heard from Tesla and five bad and I'll

keep it short I'll go through them

quickly margins up in the face of price

Cuts amazing even with credits removed

this was a really good positive shocker

they've clearly got efficiency in

manufacturing and that's the reason you

want to invest in Tesla big fan of that

uh so we like that good we got a very

hope-filled Elon which was also very

good and we have the hope of new vehicle

models coming whether we actually get

new models or they're just refreshes

we'll see but there was some bad and so

we kind of have to weigh the good and

the bad here one we just added basically

nine lifts to our valuation the riot

haling company lift we added nine of

them to our valuation overnight so I

think we might be adding a little too

much hope there we've got the risk of

the share comp plan for Elon Musk is he

going to get paid if he doesn't get paid

is he going to end up taking the Optimus

uh robot uh the the humanoid robot

somewhere else we've got the negative

cash flow risk with the AI Investments

that's why we're no longer building new

gigafactories Giga Mexico is basically

on hold and we basically just took away

the hope that the 4680 battery cells are

truly the next greatest Innovation which

is the same thing Elon did with Dojo

that hey we're doing our own servers but

now we're going to use Nvidia chips hey

we're doing our own batteries ah we're

just going to use cheaper Chinese Chips

so they're pros and cons here and I'm

sitting here wondering is it time to

Reby and I just haven't figured it out

yet is a more affordable soon to be

announced or unveiled or uncloaked

vehicle that they talked about on the

earnings call is that a pro or Con in

your

perspective it's a pro if we can

actually get a new model but they

purposefully dodged that answer in the

earnings call leaving the door open to

the possibility that more efficient

vehicles are just versions of the model

3 and Y that are manufactured in a

different way so for example a steer by

wire on a Model 3 or Y uh or using a 48

volt architecture to sort of bring down

some of those costs without actually

introducing a new model and so investors

sort of have to evalue okay are we going

to get new models that are going to get

us to vehicle growth or do we just

forget vehicle growth for a moment and

just hope that full self-driving is

actually going to produce the revenue we

think it might keep in mind right now

we've got a take rate of about 10% it'd

be nice to see that around 20 30% but

will the cost of FSD come down to offset

some of those gains those are some of

the other things to value now I just

want to be clear I love full

self-driving and I think in the future

everybody's going to use full

self-driving but we might be a few years

away from Robo taxi so pricing that in

also hard and that's why when I look I

go oh wow up 12% it's still lower than

where I sold my shares I sold some

shares between uh about 71 175 so I

could still buying at a discount but I'm

sitting here wondering we really that

close to full self-driving yet to start

pricing this in in in other words full

autonomy I'm not convinced of that yet

what's the dial mover that would tell

you it's time to get back into the

name I think we've got all of 2024 to

set an EPS floor and so there's plenty

of time to buy in my opinion and then

the dial mover is vehicle growth again

where we actually get back to going from

1.8 million vehic vehicles to 25 to

three to 35 to four 5 million Vehicles

that's the growth we need because the

more Vehicles we get on the road the

more Tesla can make from Full

self-driving the more data we have to

increase that moat for robo taxis the

more potential Robo taxis we can have on

the road the more cash flow positive

cash flow they have with good margins to

invest in other initiatives like the

Optimus my concern is with this negative

cash flow we're facing now we're really

cutting out other initiatives and I

suspect that a lot of them are going to

take the back burner they're suggesting

that they're starting production of the

uh Factory to build the semi truck but

they've said that for five years and

they showed us a picture of a graded lot

but as someone from a real estate world

I know that we grade Lots just to keep

the weeds in the city away so I have I

have a lot of skepticisms and I have a

lot of hope I'm just not sure how much I

could value that hope at right now Hey

Kevin uh just lastly while we have you

and I would have loved to ask a question

about the cybertruck I actually need to

Pivot here because of some breaking news

that came out during this hour from the

Biden Administration that that may

influence uh you or many of your

colleagues as well in the kind of

influencer uh and content creator

category also uh where there's going to

be more of the perhaps onus on a

potential buyer to come forward and buy

Tik Tok or else it will not be allowed

to exist here in the US and a US US

owner specifically I should mention as

well what what do you think that does

for a lot of the content creators like

yourselves or and where do you shift to

if not on Tik Tok I would be surprised

if somebody didn't come around to buy it

because quite frankly if Tik Tok was

going to get 100% shut down you could

take the value of Tik Tok in America and

just set it to zero so anything above

zero is going to be a win for bite dance

and quite frankly I'm sure they have

plenty of friends with American

passports who could buy this company and

pretend to be different do I really

think it'll become truly fully

independent probably not uh will it get

bought up very likely as a Creator uh

it's definitely an uncertain time

because there's always that chance that

it just it's completely gone and and and

removed from the App Store and even just

a period of time this is the biggest

risk even if it just disappears for a

few months as soon as people get the

routine of using that kind of platform

out of their habit of opening their

phone every time they go to the bathroom

or they're in the kitchen to get a

coffee or whatever as soon as that

routin turns into okay now they're on

YouTube shorts or they're on Instagram

or something else that definitely hurts

creators on Tik Tok so the worst case

scenario I don't think is that they're

gone forever it's just that if they're

gone for a window that unwinds people's

habits and that's the worst thing that

could happen Kevin really insightful

thanks so much for the time really

appreciate it Kevin pathra who you can

catch on YouTube meet Kevin of course

and financial analyst appreciate it

thanks for having me so what did I think

well it was knowing that I have had no

cough all day long and I've been live

for like 2 hours and then of course

right when I get on Yahoo finance I all

of a sudden have some weird

cough it's like it's it's the the record

dilemma the live dilemma but that's okay

so what do I think well I I I I don't

know I think that the broader economy

while we're holding up with earnings so

far and I'm very optimistic about we're

holding up how we're holding up with

earnings uh I still face a problem uh

and that is this problem it is a topping

problem of the volatile Nike Swoosh and

I think there's still potential for good

volatility ahead of us thanks to the

pain of drum pow now I thought Elon Musk

would have discussed drum pow yesterday

and we didn't get any jpow talk if we

have a second wave of inflation all bets

are off for everything it doesn't matter

how many lifts we add and and I'm not

trying to be offensive to Tesla to say

it's only because of you know the ride

hailing service that Tesla's up that's

not the argument it's just to say that

we added about $60 billion to Tesla's

valuation yesterday Lyft which is a ride

healing service only has a$6 half

billion doll market cap you know Uber's

obviously way larger but the point is

like you add another lift yay cool

there's a there's a ride healing server

if it's not fully autonomous is it worth

more than a lift is it worth nine lifts

is it worth two lifts three lifts or is

it worth you know 20% of a lift I don't

don't know uh I I don't I certainly

don't think that just because we created

some mockups we're automatically worth

what at least the lift is worth or you

know a third or a fourth uh that's

actually what is it uh 60 divided by

about 150 that would be about uh 40% 40%

of uber right uh is it worth having

added that and I don't think fully the

stock price move here is solely because

of this I think it's quite frankly a

return of sentiment you had Elon the

great cheerleader for Tesla finally tell

us look we're going to keep doing what

we do well we're going to focus on

engineering efficiency manufacturing

efficiency uh and using that to

introduce uh new models whether those

are refreshes or completely new models

we don't know but new products that we

hope can bring us to 3 million vehicles

of sales three Mill 3 million vehicles

of sales would be great but we also

don't know over what time frame that's

another issue they didn't tell us when 3

million units if I go 3 million 2026

that's great that props my numbers a lot

but some of the things that to consider

compared to the spreadsheet and I was

thinking about this a little bit

yesterday we might not actually get to

that 3 million figure by 2026 this is

why we created various different

scenarios here and quite frankly they're

incorporating their FSD Revenue

recognition into their margin so you're

you're increasing margin by a percent or

two because of FSD Revenue recognition

so if I kill FSD Revenue recognition and

I say that's what's going to let me

maintain like having FSD Revenue

recognition will let me maintain an 8

18% margin and uh I now go throw in cap

X which I'm going to have to go in here

and throw in cap X of about a billy so

let me go kill these as a percentage of

FSD and just throw in a billion dollars

annually keep in mind we'll have $85,000

h100s but those are going to be old

right you're going to have new Chips

you're going to have to continually

invest in to keep getting to the latest

and greatest levels of of autonomy and

better Perfection and smoother rides and

better comfort for users it's just going

to continuously get better and better

and better and I'm very optimistic about

it but I'm going to throw in a billies

over here and so if I do that if I give

him a 30% EPS growth rate yes I can

justify getting to uh 2011 maybe even

275 depending on how many deliveries we

get at a 30% pay which the sucker

selling for you know 161 right now so

that gives me you know an 8 to 20%

compounded rate of return which is great

but if I get my EPS growth that only

ends up sitting at around 20% well you

know in two of these cases my share

price is actually lower so I don't know

that we really got the clear color to

say oh yeah we're going to go back to

EPS growth we did get Elon suggesting

that we should be able to beat 1.8

million vehicle deliveries this year

which we had in 2023 but I think you're

comparing to a hard year and I think

you've realistically got probably all

year to to sort of take your time and

evaluate see what's going on of course

if the economy just keeps booming great

but remember we're up against you know

at least Market relative near all-time

highs

so I'm I'm conflicted uh that's the way

I look at it again I could just declare

Victory Buy in right now I could go look

everybody I save $10 a share and I tax

loss Harvest win win win could just

declare

Victory uh but that would be dishonest

to the confliction that I still have so

I'm evaluating uh how my my thesis uh

really Nets out and uh that's sort of

the process that I'm in right now but

these are just some of my honest

transparent thoughts about how I feel uh

you know the next the morning after so

to speak anyway hopefully this is useful

to you let me know what you think in the

comments down below and um as we sort of

expected the we've got lots of uh lots

of haters on the internet that are

retweeting my uh uh dear Elon Musk

please just cancel the earnings call uh

tweet I I don't understand this I think

I think people like to just get out of

the way although we did suspect that

people would do this but they kind of

fell into our trap so to speak of uh

just appearing like a hater but if you

remember yesterday the stock was up like

8 or 9% before the earnings call and we

were joking live we joked about this all

recorded live we were like hey cancel

earnings call will take the 9% because

historically the stock goes down during

the earnings calls right this was great

Elon performed really well on the

earnings call so of course it's easy

then after the earnings call when it

moves up another 3 or 4% for you know

Omar come on Omar you know better than

this but again this this gets likes this

gets engagement people like oh yeah I

don't like Kevin either it's like well

when you mis contextualize someone uh

it's just it's just rude and uh uh and

um sad honestly it's sad it lacks logic

uh I sorry dude but come on you know

SMR reposting without comment winky face

you know again and so you have the

luxury of posting that uh you know three

and a half hours after the earnings call

ends thank you uh Thanks for for for

that that's that's all I'll say all

right we'll see you why not advertise

these things that you told us here I

feel like nobody else knows about this

we'll we'll try a little advertising and

see how it Go congratulations man you

have done so much people love you people

look up to you Kevin PA there financial

analyst and YouTuber meet Kevin always

great to get your

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