We need to Talk about Tesla Stock.

me Kevin here it's time to have a

realistic conversation about a Tesla

stock let's make it clear we've all seen

headlines about price Target revisions

that big companies like JP Morgan or

delivery estimates this none of that I

think is really core to the long-term

vision of Tesla mostly because I I think

we've all come to realize at this point

when a stock goes up the price targets

magically follow the stock up and when a

stock goes down the inverse happens so

usually I think price targets aren't

worth paying attention to I think what's

more worth paying attention to is sort

of uh longer term outlooks uh from

analysts uh and right now longer term

outlooks at least on an average from

Wall Street uh are that Tesla's going to

grow earnings per share somewhere around

30% per year uh on an EPS growth basis

which is great uh this is fantastic

growth it's not that 50% from years back

but the 30% is still pretty good going

forward it actually puts Tesla

at around

$225 per share it puts them at right

around a 2.6 peg in case you're ever

looking at those price to earnings

growth measures I usually like 2.6 as a

software Peg where a more manufacturing

Peg I like to go with around a six which

unfortunately puts Tesla a little bit

closer to that 135 to 140 range now that

doesn't mean Tesla stock needs to go

down to this range but what it does mean

is if analysts look at Tesla as a

Manufacturing Company one way we can

actually increase this here is by

increasing the earnings per share of

Tesla in the near term and if Wall

Street wants to Value Tesla as a

software company which obviously we know

it's a fantastic artificial intelligence

play then we'd have even more earnings

to base a higher multiple off of which

would be great for Tesla's valuation so

both of these numbers could be

substantially higher with more earnings

and that's actually what I'd like to

focus on in this video if somebody asked

me Kevin what would you do and I'm not

applying for the job I got plenty going

on with house hack in fact I think

having less on my plate is very

important as a CEO I've personally found

that if you have too many irons in the

fire you might not be paying as much

attention as you should to your core

business which isn't great and some of

that could be happening with Elon so

that's why I wanted to put this video

together of what would I do if I were

solely the CEO of t

and the first thing that I would do is I

would think of what are we really good

at and where are we making a lot of

money and the first answer to that is

mass production and I would love to mass

produce more Vehicles now obviously

we're somewhat demand limited right now

we've got plenty of capacity and plenty

of expansion capability at our existing

gigafactories to produce many more

Vehicles unfortunately I don't think

mass production is really being

highlighted right now mostly because

Elon believes why manufacture a model 2

or a $25,000 vehicle why bother the

future is autonomous well I don't

disagree that the future is autonomous I

Just Disagree in the timing and I think

you actually arm yourself to be more

prepared for an autonomous future by on

behalf of Tesla making as much money as

Tesla can right now to make the

necessary Investments to get all the way

to autonomy now how do you do that well

my opion you should launch what I call

the Tesla Model

2.5 and the model 2.5 is really a paired

down model 3 and that way you don't have

to rebuild sort of a design of a vehicle

but instead what you're doing is you're

going with a smaller battery pack you

still have a four-door vehicle and

you're trying to get that price point to

$25,000 and you're going to include FSD

is standard now that sounds wild well

there are incredible margins on FSD and

there are incredible margins on selling

larger battery packs and we know that

with tariff Warfare and input costs some

things are more expensive today though

fortunately lithium prices have fallen

off of a cliff but what happens here is

you create finally the growth story for

that manufacturing Peg again at Tesla it

creates a strong fundamental foundation

for not only the stock but also the

brand as a brand that's growing and not

stagnating a grand a brand brand that

has sales growth people are nervous

about newish car companies Tesla's still

newer I mean it's been a while around

for a while but certainly not the Legacy

age of like you know Ford or GM but one

of the benefits of growth is people

don't have this fear over oh my goodness

you know what if what if the company

goes bankrupt quite literally somebody

asked me the other day hey I I own a

rivian if if they go bankrupt who's

going to take care of the service for my

car and I'm like okay hold on we're a

few steps ahead here we're we're not

close to that yet uh obviously rivi and

we could talk about their fundamental

analysis and their balance sheet issues

separately uh but the point of that is

this is in folks Minds so when you grow

the company you apply the brand has

pricing power even if the margins may

only be let's say the margins are 10% at

this level we'll put them in at 10%

margin yes the margins are lower but

what we'd be able to do is actually pick

up more of the remaining EV tax credit

that are available yeah we expect a lot

of those might go away but they haven't

gone away yet Trump's tax plan isn't

here yet so milk as many of those EV tax

credits as you can you don't have to

retool the entire factory set instead

strip down the battery and maybe some

other more unnecessary features you know

strip out some of the the I don't know

seed heaters or or something right there

are plenty of things that you could do

to strip this down get to a 10% margin

and sell an affordable four-door vehicle

for mass production now the reason you

include FSD in my opinion is because you

want all of the data you can get your

hands on that is Tesla's moat right now

Tesla is hands down the best Adas that

exists that is the uh driver assistance

software it's the best that exists

there's hands down no question Mercedes

BMW any of these companies don't hold

the candle Tesla now the benefit of

maximizing your user base now even and

expanding it even more than you've ever

done before is you keep your moat see a

concern that I have for Tesla is that

Tesla used to probably have something

like a 5-year moat and I think that Moe

is starting to shrink if we look at

Chinese manufacturers like a byd with

their 5minute quick charge or their ad

ass technology they're actually already

getting pretty dang close to what

Tesla's doing but in terms of American

manufacturers a lot of them are probably

going to have to rely on an Nvidia Drive

platform and I think that's still going

to take a few years of real neural

network development uh to get them close

to Tesla so Tesla still has a lead but

unfortunately that lead is narrowing I

would argue that Tesla used to have a

5-year lead and we're probably down to

about a 2-year lead right now and one of

the reasons I think that lead is

shrinking is because we're focusing Less

on getting FSD in the hands of more

people we're FOC focusing less on

getting more Tesla vehicles and the

Tesla brand into the hands of more

people and

instead I'm not entirely sure what the

focus is now I know that might sound

wild because obviously Elon Musk told us

oh well you know cyber cabin Optimus

great but we can do both see that's what

blows my mind the R&D side of Tesla just

like any company the R&D side of the

company can continue Full Speed Ahead or

full steam ahead if you will we could

still manufacture or begin manufacturing

cyber caps and perfecting our full

self-driving technology for cyber cabs

while at the same time expanding the

brand in a positive and affordable way

getting FSD into the hands of more

people and promoting the mission that

Tesla stands for which is a cleaner

energy future with higher MPG on you

know if you adjust towards gasoline the

the miles per gallon you're getting on a

Tesla is substantially better at an

affordable price with the safety so

saving human lives this is the core of

Tesla if Tesla leaned into the core

Mission here and we actually got to

growth again where we were now showing

hey look yes we're maybe selling the

vehicles at a lower margin but look

we're growing 1.8 million Vehicles easy

we're now at 24 we're now at 28 we're

now at 34 oh by the way R&D is almost

done with the Cyber cab by the way we're

now cranking on the semitruck how long

is the semi-truck been delayed you know

we finally started to build the shell of

the Cyber uh sorry not the Cyber truck

the Cyber semi- we finally started to

build the shell of the semi

facility but as far as we can tell

that's just the shell we still don't

actually know if the semi is going to be

capable of real load hauling especially

in colder climates we don't know that

yet we have hope but we don't know that

yet what we do know is that Tesla can

Mass manufacture cheaper cars and save

lives and support a sustainable future

and this is what Tesla should Double

Down on while expanding their FSD Moe

for at least their Hardware that's

currently in vehicles we know that

Hardware 3 is likely going to have to

get upgraded to Hardware 4 at a cost for

Tesla uh now Elon actually suggests it's

a good thing that so many people didn't

upgrade to full self-driving under

Hardware 3 because he acknowledges

Tesla's going to have to foit the bill

for those computer upgrades but when is

that going to happen right we've seen

the Roadster that was promised what s

years ago and we still haven't seen

those deliveries but okay let's not our

Mass Market vehicle focus on what

Tesla's good at inexpensive

manufacturing now what about the other

benefits or the upshots of Optimus and

Robo taxis and the relationship with

Trump well unfortunately each of these

three items is what I call a hope Factor

that's not to say that I'm bearish on

any of these three factors it's just not

core to what matters for Tesla's actual

valuation right now which which is a

multiple of earnings per share it's very

difficult right now to factor in how

much money is Robo taxi going to make

not only because we have the competitive

elements of you know Amazon zuk's

getting closer uh in fact they're doing

Robo taxi rides right now in um in San

Francisco mind you that probably has

zero hope built into the Amazon

valuation it's actually a a brilliant

Trojan Horse if you need exposure to

Robo taxis without it being Tesla Amazon

uh this I don't think there's a single

analyst pricing in a dime of Robo taxi

revenue for Amazon and they're actually

doing

self-driving rides right now in San

Francisco now that's that's not to say

that they'll be as scalable as Tesla I

think Tesla has a lot of advantages my

simple argument is while we are focusing

on the R&D future right you've got the r

uh well I should do like that there you

go R&D future while you focus on this

future which is built on Optimus

potential uh lower taxation or Le you

know more conducive business regulation

for for Tesla which I don't really know

that Tesla needs a lot more regulatory

support I actually think Nitsa has been

uh in many examples actually relatively

reasonable to Tesla my favorite was when

uh they were investigating Elon mode

where they took away the nag and rather

than getting Elon in trouble they sent

him a letter and said hey what did you

learn from not having the nag where you

have to touch the steering wheel

I've always maintained that I thought it

was unsafe that you have to Wobble the

steering wheel or put pressure in One

Direction on the steering wheel while

you're driving on the highway just to

tell it you're there just because of the

risk of accidental disengagements

whereas uh the the non nag feature and

now the pay attention feature I think is

is much safer uh and I think that was

done in Partnership basically with

Regulators so I don't think Regulators

are all bad I don't know how much

regulation you really need to open up

for Tesla the optim future uh and then

of course the robo taxi future you know

folks say hey well you know Robo taxis

that's where you need the regulatory

support but do you the the robotaxi

support uh is already in existence in

places like Texas or California where

self-driving is a potential already so I

don't know that you need that much more

regulatory support while while you prove

a concept the states are already

providing that support so on one hand

you have this and then on the other hand

uh what you really should do is prop up

as much as possible your manufacturing

unfortunately I think that Elon is

distracted with his vision of the future

which I agree is a great vision but it

is not one that is near term useful to

the Tesla Mission because you could do

both of these and and that's what

confuses me with $20 billion of free

cash why are we not tripling down on

manufacturing the cheaper model that was

promised rather than just cheaper

variants they heavily implied that there

would be a new model now we have cheaper

variants and I understand my argument is

here fine if we're going to go with the

cheaper variant model then let's do it

let's get a smaller battery pack let's

strip what we can let's get to the

$25,000 car and why don't we deliver

what we promised especially in the face

of plummeting lithium uh battery pack

prices anyway so one argument uh that

you do you go all in on manufacturing

while at the same time you don't take

away from the robo taxi de

uh and the Optimus development but the

other thing that we have to consider in

the valuation over the last uh four

three three to four months uh is we've

had a lot of Hope the Trump trade the

robot taxi trade the Optimus trade we

actually need to start showcasing and

delivering the product so let's deliver

more earnings here but let's now

showcase what Optimus is actually

functionally doing within Tesla now we

see Snippets and videos like the Optimus

catching a ball or sort of moving you

know items in and out of a box but we

want to see some real use cases I want

to start seeing some Optimus robots

unloading a truck walking from the truck

and bringing uh you know boxes with

actual product in it uh and and this I

think creates a uh reasonable way for

analysts to go okay now we could start

valuing this see it's cool when you see

Optimus catch a ball but catching a ball

doesn't make money what makes money is

Freight unloading doing something

uh and now analysts especially with the

help of Tesla you know Tesla could say

look we're saving X many man hours or

whatever that could be calculated into

an an earnings per share projection

which is hard to do today but then it

actually supports the stock supports the

brand a little cut off that just says

EPS here uh the same thing with Robo

taxis where do we sit right now on Ro oh

there's Lauren on the other hand

something that you could be doing with

the robo taxi is showing Robo taxis

potentially sh you know bringing people

from parking lots to the front of the

facility start showing some more use

cases of how we're actually using the

robo taxis now Tesla did do this in one

aspect where we saw Tesla sort of

self-driving themselves from the factory

to uh to the port if you will um it'd be

nice to see more of this of people

getting in and engaging with the vehicle

and I think that's all going to come we

know this is part of the R&D future uh

so I think from a marketing point of

view those things would help but by and

large one of the largest or most

important things that Tesla could do

right now uh is uh get politics out of

its life that's going to be very

difficult uh see Tesla has such a

wonderful team of of designers and

engineers and researchers and workers uh

Tesla did a smart thing a few years ago

where they showcased the entire team the

panel of workers at Tesla uh that uh

that were leading the company

unfortunately many of whom aren't at

Tesla anymore or many of whom who have

also sold quite a bit of the stock I

think it would be wise to Showcase that

team again and potentially for

Elon at least

temporarily uh assign sort of an interim

CEO to the company and let somebody else

run Tesla and actually focus on Tesla

fulltime so I would argue that an

interim CEO would help distance some of

this political hate that Tesla gets from

Tesla uh and and separate Elon for a

moment while actually having somebody

who can then fully focus on you know

what we do need to focus on uh a model

to in some more scale we do need to at

the same time focus on scaling up our

manufacturing focus on showing what

we're doing in the research and

development side and actually utilizing

the cash we have available if we have

all of this cash to expand production in

America what are the plans to start

doing that let's do it are we going to

double the size of Giga Texas or do we

have too many Foundation issues at the

factory over there literally because of

where they built it topic probably for a

different video uh then do we you know

start an Ohio or Detroit facility where

uh you now all of a sudden we could

compete with in the location uh and take

advantage of some of the supply chains

that exist in those regions for

manufacturing

Teslas Manufacturing buildout in

conjunct function with a lower cost

model while showcasing some of the

advances that we're not seeing right now

on a regular basis for the future along

with an interim CEO I think are the most

critical next steps for Tesla in the

meantime Tesla is probably going to face

hardship mostly because Tesla in a

portfolio today is a defined support of

Elon Musk this means unfortunately some

fund managers have to remove Tesla from

people's portfolios because of the

relationship to Elon Musk I think an

interim CEO could at least help with

some of this uh and really I don't think

anybody questions or or like people are

trying to vandalize starlinks I we do

see starlink contracts getting canceled

but it's not like they're looking to

vandalize starlinks or vandalize rocket

ships mostly because I think that with

space X Elon has enough distanced

himself where where the company almost

looks and feels like it's running itself

you know it's not like we're getting

these public earnings calls on a regular

basis uh to where I think that same at

least separate feeling you know

obviously he hold starlink and SpaceX

events or he'll go to the launches uh

but there's enough of a distance between

SpaceX and the starlink product in Elon

uh that you have less hate towards what

they're doing especially now this you

know picking up our astronauts at the

space station which is incredible

incredible

Technologies uh you know catching

catching the the sort of Mars Rock I

mean these things are amazing right but

there's enough of a distance between

Elon and SpaceX SpaceX doesn't seem to

be as much of a victim as Tesla's and I

think that's mostly because Elon is

living mostly at Doge in the white house

uh and then when it comes to caring

about Tesla

all we really get focus on uh is the

future of Robo taxi and how close the

Cyber cap is but if this is what we're

hinging the future of the company on

which is what Elon tells us right don't

invest in Tesla stock until unless you

think you know full self-driving is

going to be a 100% success well then

there shouldn't be a surprise that as we

get less of our

CEO and less or or fewer Robo tax C

updates that all of a sudden all we have

left to look at are deliveries and we

didn't get a promised lower cost car

we're barely getting some refreshes to

variant and we're not really getting

what was promised and so it's no

surprise the stock is selling down now

in a recessionary environment all stocks

are going to go down almost certainly so

we don't really need to consider that

aspect right now uh although I do think

if we had a recession now Tesla would be

less recession resilient than ever

before mostly because if if we did have

a recession in

2022 your white collar workers had

plenty of cash and jobs available to

keep buying Teslas and affording Teslas

rates were also still lower for the

first half of 2022 today the opposite is

true there there's a lack of available

white call or work and uh people are who

are switching jobs are starting to take

significant pay cuts versus what they

were making before just to have work uh

and so this this could make Tesla a

little bit more sensitive again because

still catering to that higher income

audience where I do think there are

opportunities to cater to a lower income

audience one thing that Tesla is doing

obviously is they subsidizing lease

rates and interest rates now with the 0%

APR and all this but ultimately people

are still smart they look at that

sticker price and they realize hey you

know why am I going to pay $35,000 or

$33,000 or whatever it is for a car when

I can get a you know $25,000 car or even

a $22,000 car like a you know a camera I

think they're somewhere around 24K now

and not have the potential brand issues

or the vandalism issues that you get

with the Tesla at the moment while at

the same time you actively have a CEO

who's saying hey the future is Robo taxi

we're basically going to focus Less on

our manufacturing side that that make

seems to make me a little less

interested in wanting to buy a TLA and I

think that could affect other folks as

well because ah you may as well wait

wait for the robo taxi cyber cab my take

there now uh as far as uh the potential

of us being able to loop our vehicles

into sort of the robo taxi Fleet

unfortunately I think that's a very long

time away in fact I would argue that

Robo taxis are a very long time away as

well and that's why I think it's so

important to Triple down on

manufacturing with the excess cash you

have subsidize those margins a little

bit and take market share mostly because

my belief is we probably won't actually

see uh like Tesla Robo taxes where we're

able to sort of invest in vehicles and

throw them into the fleet until at least

the 2030s I hate to say it because it

just it sounds bearish but I have this

mindset that whether we do or don't

there's a chance of going through a

recession between the next four to five

years uh that will slow investment and

capital expenditures we also still

haven't gotten to the phase yet where

which is still a very painful phase that

you have to go through where the robot

taxes are good but they're not perfect

and then they accidentally cause an

accident or they kill someone you're

just going to get set back years in a

regulatory environment uh Trump's only

going to be here for until 2028 and if

people are dying then even even Trump

can't save the day with regulation uh

and you know come January 2029 somebody

could crimp down those regulations again

so I still think there's quite a bit of

a way to go to get to a robo taxi future

and and I just don't see it until the

2030s and that's where I look and say do

we really want to be stagnant on the

manufacturing side at 0% growth or

potentially negative growth for the next

5 years when we could be taking market

share we have the margin we have the

best 8s technology in the world why not

make Tesla great again