Investor's Corner
Tesla (TSLA) loses place as US’ most shorted stock amid continued Model 3 push
Tesla (NASDAQ:TSLA) recently lost its place as the most shorted company in the US stock market. With short interest slightly declining this third quarter, Tesla has handed over the title of most-shorted publicly-traded company to Amazon, which currently has a $9.97 billion short interest.
The update on Tesla’s shorted shares was posted on Twitter by Ihor Dusaniwsky, Managing Director of Predictive Analytics at S3 Partners LLC, a financial analytics firm based in New York. Dusaniwsky noted in his update that Tesla short interest currently stands at $9.83 billion, which translates to around 32.43 million shares shorted, or 25.43% of the company’s float. The S3 Partners executive further noted that Tesla shorts are up $638 million this week amidst TSLA’s -6.02% price move.
Dusaniwsky also noted to Reuters that there was some short covering during the aftermath of Elon Musk’s fateful “funding secured” tweet last August 7. Despite this, most of the shorts that covered their positions then appear to have been replaced by new short-sellers.
“While there was some short covering the week after the tweet, there has still not been any significant net Tesla short covering on the Street. Any traders who have closed down their positions to realize some profits have been replaced by new ones looking for continued price weakness,” he said.
August has proven to be a challenging month for Tesla investors, who saw the company’s shares exhibit even more volatility than usual in the days and weeks following Musk’s announcement and eventual cancellation of his go-private effort. Amidst reported SEC investigations, lawsuits, and increased attacks from critics and short-sellers, Tesla stock has remained resilient nonetheless, staying in the ~$300 range despite dipping as low as $288.20 on August 20.
The S3 Partners executive believes that the resilience of TSLA stock might become a trigger for increased short-selling activity against the electric car maker. Thus, it would not be surprising if Tesla ends up reclaiming its spot as the most-shorted publicly-traded US stock in the near future.
“A $300 Tesla price may be a signal of increased short selling since when Tesla’s stock price dipped below $300 per share in March, shares shorted climbed from 30.0 million to 41.6 million in just over two months,” he said.
Tesla is a polarizing company, attracting an equal number of supporters and critics, and this is particularly evident in the company’s stock. Back in May, there were 39 million TSLA shares held short — the highest in Tesla’s history. That said, the number of shares held short has since exhibited a slight yet seemingly steady decline, dropping to 32.72 million on August 15 and 32.43 million as of this week.
While Tesla continues to deal with the aftermath of Elon Musk’s privatization attempt, the progress of the company’s Model 3 production push is quite encouraging. Over the past two months, Tesla has showed signs that it is capable of maintaining a sustained optimum rate for the production of the electric car — a feat confirmed by Elon Musk in the Q2 2018 earnings call when he announced that Model 3 production hit 5,000 vehicles per week during “multiple weeks” in July. Tesla’s VIN registrations also went into overdrive in August, passing the 100,000-vehicle mark. Baird analyst Ben Kallo referenced the Model 3 in a recent note as well, stating that Tesla’s fundamentals, such as its progress in its mass-production efforts for the electric sedan, is still “underappreciated.”
As of writing, Tesla shares are trading down 0.73% at $300.93 per share.
Disclosure: I have no ownership in shares of TSLA and have no plans to initiate any positions within 72 hours.
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.
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