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Short Tesla and Buy GM Stock Says Eisman of "The Big Short"
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Steve Eisman, a featured character in the famous 2009 financial crisis-based movie “The Big Short,” is shorting Tesla (TSLA - Free Report) due to doubts related to CEO Elon Musk’s execution methods.
Eisman is a famous hedge-fund manager and investor who was one of the few investors to predict the fall of the subprime mortgage security during the 2008 financial crisis. He was the main character of Michael Lewis’ best-selling book “The Big Short” and was later portrayed by actor Steve Carell in the movie based on the book.
Eisman, in a recent interview with Bloomberg Television, casted doubts over Tesla and its CEO Elon Musk and said he is shorting the stock. He said that although Musk is a “very, very smart man,” he has “execution problems.” The “execution problems” include not investing enough in autonomous driving, not following up with ambitious promises, tenting, and executive turnover.
Tesla has been struggling through some issues with cash. It recently asked suppliers to return a portion of payments for parts to help turn a profit.
In defense of this, Musk said that the company will be profitable in the third and fourth quarters of this year when it produces 5,000 Model 3 sedans a week. The company already surpassed that amount in the last week of June but has yet to validate Musk’s claim that it can generate profit by the end of 2018.
Alongside the cash problem, Eisman was disdainful of the Tesla building cars in a huge tent outside production facility in Fremont, California, and pointed out the recent management turnover as another one of Musk’s “execution problems.” The electric-car maker has lost a large portion of its executives over the last two years.
In addition to the aforementioned issues regarding the company, Musk has also been condemned by the public after calling one of the rescuers of the boys’ soccer team in a Thai cave as a “pedo.”
Referring to Musk, Eisman said unless “he pulls a rabbit out of the hat,” he doesn’t see much positivity coming for the company.
On the other hand, another car giant, General Motors (GM - Free Report) , is liked by Eisman because of its investment in autonomous vehicles. Eisman said although it is “one stock” in his portfolio that “hasn’t worked yet,” GM has the potential “for a big home run.”
GM announced this May that Softbank Vision Fund would invest $2.25 billion in Cruise, its self-driving car unit. Regarding the race in autonomous driving, Eisman said GM and Alphabet Inc.’s Waymo (GOOGL - Free Report) are the leaders, with Aptiv Plc. (APTV - Free Report) also showing potential.
Wall Street’s Next Amazon
Zacks EVP Kevin Matras believes this familiar stock has only just begun its climb to become one of the greatest investments of all time. It’s a once-in-a-generation opportunity to invest in pure genius.
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Short Tesla and Buy GM Stock Says Eisman of "The Big Short"
Steve Eisman, a featured character in the famous 2009 financial crisis-based movie “The Big Short,” is shorting Tesla (TSLA - Free Report) due to doubts related to CEO Elon Musk’s execution methods.
Eisman is a famous hedge-fund manager and investor who was one of the few investors to predict the fall of the subprime mortgage security during the 2008 financial crisis. He was the main character of Michael Lewis’ best-selling book “The Big Short” and was later portrayed by actor Steve Carell in the movie based on the book.
Eisman, in a recent interview with Bloomberg Television, casted doubts over Tesla and its CEO Elon Musk and said he is shorting the stock. He said that although Musk is a “very, very smart man,” he has “execution problems.” The “execution problems” include not investing enough in autonomous driving, not following up with ambitious promises, tenting, and executive turnover.
Tesla has been struggling through some issues with cash. It recently asked suppliers to return a portion of payments for parts to help turn a profit.
In defense of this, Musk said that the company will be profitable in the third and fourth quarters of this year when it produces 5,000 Model 3 sedans a week. The company already surpassed that amount in the last week of June but has yet to validate Musk’s claim that it can generate profit by the end of 2018.
Alongside the cash problem, Eisman was disdainful of the Tesla building cars in a huge tent outside production facility in Fremont, California, and pointed out the recent management turnover as another one of Musk’s “execution problems.” The electric-car maker has lost a large portion of its executives over the last two years.
In addition to the aforementioned issues regarding the company, Musk has also been condemned by the public after calling one of the rescuers of the boys’ soccer team in a Thai cave as a “pedo.”
Referring to Musk, Eisman said unless “he pulls a rabbit out of the hat,” he doesn’t see much positivity coming for the company.
On the other hand, another car giant, General Motors (GM - Free Report) , is liked by Eisman because of its investment in autonomous vehicles. Eisman said although it is “one stock” in his portfolio that “hasn’t worked yet,” GM has the potential “for a big home run.”
GM announced this May that Softbank Vision Fund would invest $2.25 billion in Cruise, its self-driving car unit. Regarding the race in autonomous driving, Eisman said GM and Alphabet Inc.’s Waymo (GOOGL - Free Report) are the leaders, with Aptiv Plc. (APTV - Free Report) also showing potential.
Wall Street’s Next Amazon
Zacks EVP Kevin Matras believes this familiar stock has only just begun its climb to become one of the greatest investments of all time. It’s a once-in-a-generation opportunity to invest in pure genius.
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