Investor's Corner
Tesla investors advised to ditch Kimbal Musk, James Murdoch by ISS in Shareholder vote
Tesla investors (NASDAQ: TSLA) are advised not to re-elect Kimbal Musk or James Murdoch in the coming Annual Shareholder Meeting by proxy advisor Institutional Shareholder Services (ISS). Because Musk and Murdoch received large compensation packages from Tesla’s board, ISS believes the two non-executive board members do not present any advantages to the automaker’s general Governance.
Musk, being the brother of CEO Elon Musk, has overwhelming support from most investors due to his family ties. Kimbal has spent much of his career in the restaurant business, acting on the board of Chipotle Mexican Grille from 2013 to 2019. He is also the founder of an indoor food growing operation called Square Roots. Murdoch is the son of media tycoon Rupert Murdoch and once held the position of CEO of 21st Century Fox. Musk and Murdoch have been on Tesla’s board since 2004 and 2017, respectively.
A 14A filing with the SEC from late August showed that Kimbal Musk and Murdoch were nominated for re-election as Class II directors. “A discussion of the qualifications, attributes, and skills of each nominee that led the Board and the Nominating and Corporate Governance Committee to the conclusion that he should continue to serve as a director follows each of the director and nominee biographies,” the filing said.
Despite their years of service to the Tesla board, ISS believes the two current board members are entitled to excessive payouts from company performance-based incentive plans. “Votes AGAINST directors James Murdoch and Kimbal Musk are warranted due to concerns regarding excessive compensation to named executive officers and to non-executive directors,” ISS said in a note to investors, according to Reuters.
Tesla to hold 2021 Shareholders Meeting on Oct. 7: Here’s what will be discussed
ISS says that Kimbal’s payout package is supplemented by the fact that he also does not serve on any board committees. Meanwhile, Murdoch service on Audit and Governance Committees. According to the ISS note, the Audit Committee pledged a large sum of company stock to directors, which raised questions regarding its risk oversight. The Governance Committee failed to react appropriately to last year’s Shareholder proposal, which was supported by the majority of voters.
The Tesla Board will change at the upcoming Shareholder’s meeting. It will shrink from nine members to eight following the departure of director Antonio Gracias, who agreed in part with the Nominating and Corporate Governance Committee to leave the company, according to the 14A filing with the SEC.
Ultimately, Tesla shareholders will have the final say in what happens with Kimbal Musk and Murdoch. Tesla will hold its 2021 Annual Shareholder meeting on October 7th, 2021, and all stockholders will be able to vote. Last year’s meeting saw Elon Musk remain CEO due to a 98.8% vote that approved his position. For the first time, the Shareholder Meeting will be held at Gigafactory Texas in a virtual fashion.
Disclosure: Joey Klender is a TSLA Shareholder.
Don’t hesitate to contact us with tips! Email us at tips@teslarati.com, or you can email me directly at joey@teslarati.com.
Tesla stock (NASDAQ: TSLA) closed at an all-time high on Tuesday, jumping over 3 percent during the day and finishing at $489.88.
The price beats the previous record close, which was $479.86.
Shares have had a crazy year, dipping more than 40 percent from the start of the year. The stock then started to recover once again around late April, when its price started to climb back up from the low $200 level.
This week, Tesla started to climb toward its highest levels ever, as it was revealed on Sunday that the company was testing driverless Robotaxis in Austin. The spike in value pushed the company’s valuation to $1.63 trillion.
Tesla Robotaxi goes driverless as Musk confirms Safety Monitor removal testing
It is the seventh-most valuable company on the market currently, trailing Nvidia, Apple, Alphabet (Google), Microsoft, Amazon, and Meta.
Shares closed up $14.57 today, up over 3 percent.
The stock has gone through a lot this year, as previously mentioned. Shares tumbled in Q1 due to CEO Elon Musk’s involvement with the Department of Government Efficiency (DOGE), which pulled his attention away from his companies and left a major overhang on their valuations.
However, things started to rebound halfway through the year, and as the government started to phase out the $7,500 tax credit, demand spiked as consumers tried to take advantage of it.
Q3 deliveries were the highest in company history, and Tesla responded to the loss of the tax credit with the launch of the Model 3 and Model Y Standard.
Additionally, analysts have announced high expectations this week for the company on Wall Street as Robotaxi continues to be the focus. With autonomy within Tesla’s sights, things are moving in the direction of Robotaxi being a major catalyst for growth on the Street in the coming year.
Elon Musk
Tesla needs to come through on this one Robotaxi metric, analyst says
“We think the key focus from here will be how fast Tesla can scale driverless operations (including if Tesla’s approach to software/hardware allows it to scale significantly faster than competitors, as the company has argued), and on profitability.”
Tesla needs to come through on this one Robotaxi metric, Mark Delaney of Goldman Sachs says.
Tesla is in the process of rolling out its Robotaxi platform to areas outside of Austin and the California Bay Area. It has plans to launch in five additional cities, including Houston, Dallas, Miami, Las Vegas, and Phoenix.
However, the company’s expansion is not what the focus needs to be, according to Delaney. It’s the speed of deployment.
The analyst said:
“We think the key focus from here will be how fast Tesla can scale driverless operations (including if Tesla’s approach to software/hardware allows it to scale significantly faster than competitors, as the company has argued), and on profitability.”
Profitability will come as the Robotaxi fleet expands. Making that money will be dependent on when Tesla can initiate rides in more areas, giving more customers access to the program.
There are some additional things that the company needs to make happen ahead of the major Robotaxi expansion, one of those things is launching driverless rides in Austin, the first city in which it launched the program.
This week, Tesla started testing driverless Robotaxi rides in Austin, as two different Model Y units were spotted with no occupants, a huge step in the company’s plans for the ride-sharing platform.
Tesla Robotaxi goes driverless as Musk confirms Safety Monitor removal testing
CEO Elon Musk has been hoping to remove Safety Monitors from Robotaxis in Austin for several months, first mentioning the plan to have them out by the end of 2025 in September. He confirmed on Sunday that Tesla had officially removed vehicle occupants and started testing truly unsupervised rides.
Although Safety Monitors in Austin have been sitting in the passenger’s seat, they have still had the ability to override things in case of an emergency. After all, the ultimate goal was safety and avoiding any accidents or injuries.
Goldman Sachs reiterated its ‘Neutral’ rating and its $400 price target. Delaney said, “Tesla is making progress with its autonomous technology,” and recent developments make it evident that this is true.
Investor's Corner
Tesla gets bold Robotaxi prediction from Wall Street firm
Last week, Andrew Percoco took over Tesla analysis for Morgan Stanley from Adam Jonas, who covered the stock for years. Percoco seems to be less optimistic and bullish on Tesla shares, while still being fair and balanced in his analysis.
Tesla (NASDAQ: TSLA) received a bold Robotaxi prediction from Morgan Stanley, which anticipates a dramatic increase in the size of the company’s autonomous ride-hailing suite in the coming years.
Last week, Andrew Percoco took over Tesla analysis for Morgan Stanley from Adam Jonas, who covered the stock for years. Percoco seems to be less optimistic and bullish on Tesla shares, while still being fair and balanced in his analysis.
Percoco dug into the Robotaxi fleet and its expansion in the coming years in his latest note, released on Tuesday. The firm expects Tesla to increase the Robotaxi fleet size to 1,000 vehicles in 2026. However, that’s small-scale compared to what they expect from Tesla in a decade.
Tesla expands Robotaxi app access once again, this time on a global scale
By 2035, Morgan Stanley believes there will be one million Robotaxis on the road across multiple cities, a major jump and a considerable fleet size. We assume this means the fleet of vehicles Tesla will operate internally, and not including passenger-owned vehicles that could be added through software updates.
He also listed three specific catalysts that investors should pay attention to, as these will represent the company being on track to achieve its Robotaxi dreams:
- Opening Robotaxi to the public without a Safety Monitor. Timing is unclear, but it appears that Tesla is getting closer by the day.
- Improvement in safety metrics without the Safety Monitor. Tesla’s ability to improve its safety metrics as it scales miles driven without the Safety Monitor is imperative as it looks to scale in new states and cities in 2026.
- Cybercab start of production, targeted for April 2026. Tesla’s Cybercab is a purpose-built vehicle (no steering wheel or pedals, only two seats) that is expected to be produced through its state-of-the-art unboxed manufacturing process, offering further cost reductions and thus accelerating adoption over time.
Robotaxi stands to be one of Tesla’s most significant revenue contributors, especially as the company plans to continue expanding its ride-hailing service across the world in the coming years.
Its current deployment strategy is controlled and conservative to avoid any drastic and potentially program-ruining incidents.
So far, the program, which is active in Austin and the California Bay Area, has been widely successful.
Tesla FSD fleet is nearing 7 billion total miles, including 2.5 billion city miles
Tesla starts showing how FSD will change lives in Europe
