Tesla Is More a Musk Dream Stock Than a Meme Stock
Rather than a diet of social media vibes, the company’s investors reach toward an underlying rationale — sheer faith in the genius of Elon Musk.
The dream.
(Photo by Vincent Feuray / Hans Lucas /AFP via Getty Images)
As a stock, Tesla Inc.’s relationship with what are called the ‘fundamentals’ is similar to Elon Musk’s with President Donald Trump: That is, wayward, troubled and unconvincing. So is Tesla a meme stock? Think of it more as a ‘dream’ stock.
The sort of bad news or numbers that nudge ordinary stocks off a cliff can weirdly lend Tesla wings. Take those dreadful sales figures it just reported, which somehow sent the stock up 5% in a flat market. The ostensible reason was that, while they missed the consensus forecast, it was only by a little and a relief rally kicked in. It’s a handy rationale let down only by its glaring logical inconsistencies. The forecast had already dropped by 23% since the start of the year. Moreover, during that time, Tesla’s triple-digit earnings multiple had actually increased further — a prerequisite for relief is some angst beforehand, surely?