Long-Time Investor Claims Elon Musk Contributes Up to $150 to Tesla’s Share Price

This article does not constitute investment advice. The author does not hold any positions in the stocks referenced.

Tesla’s stock has suffered one of its most significant declines recently, raising eyebrows among investors. A notable commentator on this downturn is Ross Gerber, a veteran Tesla investor, who estimates that CEO Elon Musk could be responsible for as much as $150 of each share’s value. The company’s transformation from a struggling electric vehicle (EV) manufacturer to a leading global powerhouse is largely credited to Musk’s relentless work ethic at its production facilities. Following President Trump’s election victory in November, there was a surge of investor enthusiasm. However, mounting concerns over decreasing delivery numbers led Tesla to experience a staggering 41% drop in stock value year-to-date, negating all gains made after the election.

Tesla’s Shares Experience a 15% Drop Amid Market Turmoil

In an interview with Business Insider in late February, Ross Gerber, who leads the investment firm Gerber Kawasaki, commented on the stock’s precarious status as it had already lost a quarter of its value. He warned of further potential losses. While the stock has seen a year-to-date decline of approximately 40%, the contrast becomes even sharper when factoring in the skyrocketing prices following the election. Tesla shares peaked at about $480 in mid-December, and as of the latest close, they have plummeted over 53%.

Gerber outlined several factors contributing to his cautious outlook. He highlighted concerns about Tesla’s inflated market valuation, the recent slowdown in EV deliveries, Musk’s distractions from Tesla activities, and ongoing issues with the Full Self Driving (FSD) technology. He specifically expressed skepticism about the ambitious plan to launch autonomous cabs by June, given Musk’s preference for camera systems over lidar sensors.

Tesla shares have lost more than half their value since the peak following the election.

Speaking about Musk, Gerber noted a preference for Musk to devote more time to enhancing the Full Self Driving capabilities instead of diverting his focus to his AI venture, xAI. He mentioned that while Musk’s involvement in politics may have unsettled investors, the possibility of Musk stepping away from Tesla could have dire consequences for the stock. Gerber estimates that Musk’s influence on Tesla’s valuation ranges from $150 to $200 per share, indicating that he might account for over half of the current share price of $290 as of February 26th.

The challenges Tesla faces with deliveries are often viewed through the lens of Musk’s political engagements. During the fourth-quarter earnings call, Musk noted that factory enhancements would lead to reduced vehicle output, explaining, “Now Q1, we’ve got this massive factory retooling for the new Model Y, for example, ”which he acknowledged would have a “short-term impact on output.”

Tesla’s stock plunged by 15% yesterday amid a broader market decline, becoming one of the hardest hit in major market indexes. This nose-dive is connected to bearish reports, including one from UBS, which revised its Q1 delivery forecast down to 367, 000 from a previous estimate of 437, 000.

Notably, the stock decline has drawn attention from Musk’s ally, former President Donald Trump. In a recent post on Truth Social, Trump voiced his support for Tesla, denouncing what he termed illegal and collusive attempts to undermine the company. He stated, “I’m going to buy a brand new Tesla tomorrow morning as a show of confidence and support for Elon Musk.”

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