Investor's Corner
Elon Musk says he’ll sell 10% of his Tesla stock under one condition: If Twitter says so
Elon Musk has decided to launch a 24-hour Twitter poll that will determine whether he will sell 10% of his Tesla holdings to pay for taxes on unrealized gains.
“Much is made lately of unrealized gains being a means of tax avoidance, so I propose selling 10% of my Tesla stock,” Musk Tweeted around 3:15 PM EST on Saturday. The Tweet is accompanied by a poll, asking voters whether they support Musk’s decision to do this. “I will abide by the results of this poll, whichever way it goes,” Musk added. “Note, I do not take a cash salary or bonus from anywhere. I only have stock, thus the only way for me to pay taxes personally is to sell stock.”
I will abide by the results of this poll, whichever way it goes
— Elon Musk (@elonmusk) November 6, 2021
Musk, along with other billionaires, is often the subject of criticism for having an exponential net worth that has increased during the COVID-19 pandemic while others struggle. However, Musk, along with many other billionaires, does not have his entire net worth sitting in his wallet or checking account. The funds are tied in up stock. For Musk, it’s $TSLA, the company he owns 23% of, which puts his net worth at $318.4 billion, making him the richest man in the world by around $115 billion over Jeff Bezos, Forbes’ Billionaires List shows.
Musk’s net worth has been increasing since 2020 when Tesla started to meteorically surge in valuation. The company has experienced another tremendous increase in stock price over the past month, as Tesla is now the sixth trillion-dollar company on Earth and has gained 50% of its value in the past month. Tesla shares (NASDAQ: TSLA) closed at $1,222.09 on Friday.
Musk has never taken a salary from Tesla, and still to this day has not received a paycheck from the company. When the company was based in Palo Alto, California, Musk did receive the State-required minimum salary but never used it for himself. “I don’t cash it,” Musk said to the New York Times in 2018. “It just ends up accumulating in a Tesla bank account somewhere.”
The most recent form of criticism Musk has received about taxes was from an article in the San Antonio Express-News. The article claimed Tesla’s move from California to Texas was a move of “betrayal” and a way for Musk to avoid paying taxes.
Last year, Bernie Sanders, a Democrat from Vermont, stated in the “Make Billionaires Pay Act,” that Musk should pay a one-time, $27.5 billion tax. “According to Americans for Tax Fairness and Institute for Policy, if we taxed 60 percent of the windfall gains these billionaires made from March 18th until August 5th [2020] we could raise $421.7 billion,” the release said. “That’s enough revenue to allow Medicare to pay all of the out-of-pocket healthcare expenses for everyone in America over the next 12 months.” The act was never passed.
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Tesla received a price target boost from Morgan Stanley, according to a new note on Monday morning, but there is some considerable caution also being communicated over the next year or so.
Morgan Stanley analyst Andrew Percoco took over Tesla coverage for the firm from longtime bull Adam Jonas, who appears to be focusing on embodied AI stocks and no longer automotive.
Percoco took over and immediately adjusted the price target for Tesla from $410 to $425, and changed its rating on shares from ‘Overweight’ to ‘Equal Weight.’
Percoco said he believes Tesla is the leading company in terms of electric vehicles, manufacturing, renewable energy, and real-world AI, so it deserves a premium valuation. However, he admits the high expectations for the company could provide for a “choppy trading environment” for the next year.
He wrote:
“However, high expectations on the latter have brought the stock closer to fair valuation. While it is well understood that Tesla is more than an auto manufacturer, we expect a choppy trading environment for the TSLA shares over the next 12 months, as we see downside to estimates, while the catalysts for its non-auto businesses appear priced at current levels.”
Percoco also added that if market cap hurdles are achieved, Morgan Stanley would reduce its price target by 7 percent.
Perhaps the biggest change with Percoco taking over the analysis for Jonas is how he will determine the value of each individual project. For example, he believes Optimus is worth about $60 per share of equity value.
He went on to describe the potential value of Full Self-Driving, highlighting its importance to the Tesla valuation:
“Full Self Driving (FSD) is the crown jewel of Tesla’s auto business; we believe that its leading-edge personal autonomous driving offering is a real game changer, and will remain a significant competitive advantage over its EV and non-EV peers. As Tesla continues to improve its platform with increased levels of autonomy (i.e., hands-off, eyes-off), it will revolutionize the personal driving experience. It remains to be seen if others will be able to keep pace.”
Additionally, Percoco outlined both bear and bull cases for the stock. He believes $860 per share, “which could be in play in the next 12 months if Tesla manages through the EV-downturn,” while also scaling Robotaxi, executing on unsupervised FSD, and scaling Optimus, is in play for the bull case.
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Meanwhile, the bear case is placed at $145 per share, and “assumes greater competition and margin pressure across all business lines, embedding zero value for humanoids, slowing the growth curve for Tesla’s robotaxi fleet to reflect regulatory challenges in scaling a vision-only perception stack, and lowering market share and margin profile for the autos and energy businesses.”
Currently, Tesla shares are trading at around $441.
Tesla bear Michael Burry got blunt with his beliefs over the company’s valuation, which he called “ridiculously overvalued” in a newsletter to subscribers this past weekend.
“Tesla’s market capitalization is ridiculously overvalued today and has been for a good long time,” Burry, who was the inspiration for the movie The Big Short, and was portrayed by Christian Bale.
Burry went on to say, “As an aside, the Elon cult was all-in on electric cars until competition showed up, then all-in on autonomous driving until competition showed up, and now is all-in on robots — until competition shows up.”
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For a long time, Burry has been skeptical of Tesla, its stock, and its CEO, Elon Musk, even placing a $530 million bet against shares several years ago. Eventually, Burry’s short position extended to other supporters of the company, including ARK Invest.
Tesla has long drawn skepticism from investors and more traditional analysts, who believe its valuation is overblown. However, the company is not traded as a traditional stock, something that other Wall Street firms have recognized.
While many believe the company has some serious pull as an automaker, an identity that helped it reach the valuation it has, Tesla has more than transformed into a robotics, AI, and self-driving play, pulling itself into the realm of some of the most recognizable stocks in tech.
Burry’s Scion Asset Management has put its money where its mouth is against Tesla stock on several occasions, but the firm has not yielded positive results, as shares have increased in value since 2020 by over 115 percent. The firm closed in May.
In 2020, it launched its short position, but by October 2021, it had ditched that position.
Tesla has had a tumultuous year on Wall Street, dipping significantly to around the $220 mark at one point. However, it rebounded significantly in September, climbing back up to the $400 region, as it currently trades at around $430.
It closed at $430.14 on Monday.
Investor's Corner
Mizuho keeps Tesla (TSLA) “Outperform” rating but lowers price target
As per the Mizuho analyst, upcoming changes to EV incentives in the U.S. and China could affect Tesla’s unit growth more than previously expected.
Mizuho analyst Vijay Rakesh lowered Tesla’s (NASDAQ:TSLA) price target to $475 from $485, citing potential 2026 EV subsidy cuts in the U.S. and China that could pressure deliveries. The firm maintained its Outperform rating for the electric vehicle maker, however.
As per the Mizuho analyst, upcoming changes to EV incentives in the U.S. and China could affect Tesla’s unit growth more than previously expected. The U.S. accounted for roughly 37% of Tesla’s third-quarter 2025 sales, while China represented about 34%, making both markets highly sensitive to policy shifts. Potential 50% cuts to Chinese subsidies and reduced U.S. incentives affected the firm’s outlook.
With those pressures factored in, the firm now expects Tesla to deliver 1.75 million vehicles in 2026 and 2 million in 2027, slightly below consensus estimates of 1.82 million and 2.15 million, respectively. The analyst was cautiously optimistic, as near-term pressure from subsidies is there, but the company’s long-term tech roadmap remains very compelling.
Despite the revised target, Mizuho remained optimistic on Tesla’s long-term technology roadmap. The firm highlighted three major growth drivers into 2027: the broader adoption of Full Self-Driving V14, the expansion of Tesla’s Robotaxi service, and the commercialization of Optimus, the company’s humanoid robot.
“We are lowering TSLA Ests/PT to $475 with Potential BEV headwinds in 2026E. We believe into 2026E, US (~37% of TSLA 3Q25 sales) EV subsidy cuts and China (34% of TSLA 3Q25 sales) potential 50% EV subsidy cuts could be a headwind to EV deliveries.
“We are now estimating TSLA deliveries for 2026/27E at 1.75M/2.00M (slightly below cons. 1.82M/2.15M). We see some LT drivers with FSD v14 adoption for autonomous, robotaxi launches, and humanoid robots into 2027 driving strength,” the analyst noted.
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