Carson Block, founder of well-known short-steamer, said on Wednesday that he had no short position on Tesla, even though he still believed the business was unsustainable. “Thank God I didn’t short the stock,” Bullock said in a live interview. We once joked that Tesla might still have a market value of $30 billion when it files for bankruptcy. People who want to empty it are at their own risk. I wouldn’t do that anyway. “
Earlier this week, Tesla’s share price was close to $1,800, more than three times its mid-March low, even though it had fallen back to $1,546 by Tuesday’s close.
Despite the frenzied buying of the stock by retail investors, the short position on the stock is close to $20bn. Tesla’s market capitalisation is now 182 times its profit forecast for the next 12 months, compared with GM’s price-to-earnings ratio of 10 times.
Bullock said he once built a Tesla position, including buying convertible bonds for the company and using coupons to fund the stock’s long-term put options, but he eventually sold them and let the put option expire.
“It’s one thing to bet on Elon Musk, but it’s another to short him,” Bullock said. This guy is good at changing rabbits from his hat (to create miracles). “