Investor's Corner
Tesla (TSLA) S&P exclusion: ‘Why the rush,’ Ex-Committee head says
Tesla’s (NASDAQ: TSLA) exclusion from the S&P 500 in September came as a shock to many shareholders and investors. However, a former Committee head for the index says that there is no rush, and Tesla’s hype will keep them in the conversation for possible inclusion in the future.
Ever since David Blitzer had retired from his post at the S&P, he had been enjoying a quiet life. However, when the S&P shockingly left Tesla out of its list of newly included companies in September, Blitzer’s phone started ringing off the hook.
“I’ve gotten calls from people who know I haven’t been on the committee for a year and a half and barely ever call me about stocks, and they say, why didn’t they do it?” Blitzer said in an interview with Bloomberg. “The amount of chatter about Tesla is staggering.”
But, Blitzer isn’t convinced that Tesla’s inclusion will never happen. He just believes that the some are waiting to see if the automaker’s recent rally on Wall Street is for real, or if the stock will backtrack in the coming months.
Tesla stock has grown over five-fold so far in 2020. It has made many investors richer, and many short-sellers poorer. Still, one thing is for certain, the stock’s valuation is not certain. This is where Blitzer believes the hold up is taking place.
“There’s plenty of times when there’s big names, popular names, well-known names that don’t get added the moment they’re eligible,” Blitzer said. The S&P’s goal was never to lump together the biggest companies. It was to construct “a great measure of the market,” he said.
But more so, Blitzer does not understand why so many people are so focused on getting Tesla into the S&P. “I think he real question is, why the rush?”
TSLA stock’s skyrocket in valuation this year has surged the company to be worth nearly $400 billion. The company’s performance on Wall Street, along with other tech heavyweights like Apple and Amazon, have helped the Nasdaq 100 gain 30% in value compared to the same day in 2019. The S&P has only gained 4% so far in 2020.
Tesla (TSLA) is leaving the current S&P 500 index’s performance in the dust
Blitzer says that Tesla’s exclusion is reminiscent of Microsoft’s leaving-out from the S&P from 1986 to 1994. Although Microsoft had a market cap of over $20 billion at the beginning of 1994, the S&P committee left the tech company outside of the index.
Blitzer says that he and his committee were given grief for the decision, but they decided to do it because Microsoft had owned more than half of its outstanding shares, and at least 50% must be floating for public investors to purchase.
“After the fact — they sold off some stock, we put in the index, everybody figured they’d forget — we still got complaints. So there have been other big ones, but I guess some of us learned to shrug and say, ‘we’ll wait ‘til next month,’” Blitzer said.
The Microsoft ordeal taught Blitzer that patience is the way to handle the inclusion of some companies where their future is uncertain. While Tesla’s run in 2020 is impressive, he states that there just needs to be more time to figure out if the run is for real.
Disclaimer: Joey Klender is a TSLA Shareholder.
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.”
Tesla bear Michael Burry ditches bet against $TSLA, says ‘media inflated’ the situation
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.
Tesla stock (NASDAQ: TSLA) has landed an elusive “must own” status from Wall Street firm Melius, according to a new note released early this week.
Analyst Rob Wertheimer said Tesla will lead the charge in world-changing tech, given the company’s focus on self-driving, autonomy, and Robotaxi. In a note to investors, Wertheimer said “the world is about to change, dramatically,” because of the advent of self-driving cars.
He looks at the industry and sees many potential players, but the firm says there will only be one true winner:
“Our point is not that Tesla is at risk, it’s that everybody else is.”
The major argument is that autonomy is nearing a tipping point where years of chipping away at the software and data needed to develop a sound, safe, and effective form of autonomous driving technology turn into an avalanche of progress.
Wertheimer believes autonomy is a $7 trillion sector,” and in the coming years, investors will see “hundreds of billions in value shift to Tesla.”
A lot of the major growth has to do with the all-too-common “butts in seats” strategy, as Wertheimer believes that only a fraction of people in the United States have ridden in a self-driving car. In Tesla’s regard, only “tens of thousands” have tried Tesla’s latest Full Self-Driving (Supervised) version, which is v14.
Tesla Full Self-Driving v14.2 – Full Review, the Good and the Bad
When it reaches a widespread rollout and more people are able to experience Tesla Full Self-Driving v14, he believes “it will shock most people.”
Citing things like Tesla’s massive data pool from its vehicles, as well as its shift to end-to-end neural nets in 2021 and 2022, as well as the upcoming AI5 chip, which will be put into a handful of vehicles next year, but will reach a wider rollout in 2027, Melius believes many investors are not aware of the pace of advancement in self-driving.
Tesla’s lead in its self-driving efforts is expanding, Wertheimer says. The company is making strategic choices on everything from hardware to software, manufacturing, and overall vehicle design. He says Tesla has left legacy automakers struggling to keep pace as they still rely on outdated architectures and fragmented supplier systems.
Tesla shares are up over 6 percent at 10:40 a.m. on the East Coast, trading at around $416.
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