Come here come here come here, i've been called obsessed with this by a lot of people. I don't usually talk stocks around the apartment because it drives my girlfriend crazy. I especially don't talk tesla and by the way it's not it's not ruling my life, i mean. I don't think about it, while i'm out to dinner, or while i'm sleeping or whatever, with tesla stock, passing over two thousand dollars a share, it hasn't been an enjoyable year for tesla short sellers.

In 2020 alone, the tesla short sellers lost over 25.4 billion dollars, marking one of the longest unprofitable shorts in history. Throughout this time, the short seller arguments have evolved in a way we've never seen before. Just one year ago, the primary argument against tesla was centered around profit and demand. Today, the tesla short sellers have shifted their arguments to be based on legality rather than practicality.

In this video i'm going to cover how much tesla stock has devastated these short sellers financially and where the short seller's arguments lie today, if you're new to the channel, please consider subscribing for more content like this and let's get right into it during the second quarter Of 2020 tesla beat estimates by a substantial amount on both profits and deliveries. However, when comparing to an annual basis, tesla's sales dropped 4 year-over-year, which is understandable due to the fact that tesla's factory was shut down for a portion of the quarter during the same quarter. Gm fiat chrysler, volkswagen, ford and toyota all had their sales drop 30 to 40 year-over-year, representing an increase in market share. Nevertheless, according to a famous tesla short seller named mark, spiegel tesla is quickly losing evie market share and will soon have its revenue growth in the single digits and um one of the guys in europe.

A fund manager he's on twitter as fly4dat. Just this afternoon he threw up a market share chart for tesla and it's gone from of the ev market in europe. It's gone from over 30 percent to now around 11 and by later this year, it's going to be in the single digits, because a bunch of more models are rolling out from volkswagen and bmw. So no revenue growth for this company no unit sales growth to speak of not that it matters, because all that should matter is revenue in a growth company and sliding market share in any competitive market.

And you know europe's a bellwether for competitive ev markets. I mean china is going to be extremely competitive by later this year, because there's a whole bunch of stuff rolling out there, not from tesla the only one. That's not going to be super competitive. You know at least for a while is the u.s i mean there are.

There is some stuff coming out um, you know ford's coming out with the electric. You know mustang maki or whatever it's called and, and you know in a couple of years before tesla has a truck. Both gm and ford will have probably really good electric pickup trucks and and of course, there's the rivien. But the.

But my point is that in a competitive market, tesla's market share slides into the toilet and that's exactly what's happening in europe and that's what's going to happen to them worldwide. So there is there's no growth anywhere in this company, gordon johnson. Another notorious short seller also shares the same view. He did more deliveries than they did in the second quarter, despite having a new factory in china and a whole new car offering the model y.

So when people start to get the real out or start to see that the growth is slowing, we think it becomes a real problem for tesla. We see that we think it's going to become very evident um in the in the third and fourth quarter, and we think that pulling forward credit revenue confuses people but they're guiding that down 50 in the back half and then in 2021. We think it drops off significantly. We think they go back into burning money, just not just on a net income basis, but also on a free cash flow basis.

Unlike many other tesla short sellers who have given up the argument about batteries. Mark spiegel is still adamant about his claims. Mark has been short tesla for over six years and while he has changed his bare thesis, he still can't let this argument go mark's. Theory first started in the middle of 2017, where he publicly mentioned that tesla's batteries were inferior to the legacy automaker's batteries.

They have absolutely nothing meaningfully or sustainably proprietary and in fact, in some ways their batteries are now obsolete, but it's a design that they originally came up with, probably when they designed the first car around 2006.. Of course, we all know tesla's battery investor day is approaching, and that tesla has filed plenty of battery patents over the past few months. These patents, along with the pilot production line in fremont hint at the fact that tesla is vertically integrating into battery manufacturing. However, mark doesn't seem to be picking up on this.

On august 22nd, mark questioned a tesla bull on twitter. By asking, do you understand that tesla buys batteries from panasonic, lg and catl and doesn't make them? Do you think i am making this up with such an adamant? Bear thesis mark has set a price target on tesla of 25 dollars a share. You heard that right, 25 dollars a share 25 dollars. A share is where mark sees tesla stock going to now mark and gordon may be trading as much money as your grandma.

On the contrary, two other shorts, jim chanos and david einhorn have much more money on their hands. Jim chanos, whose short sellers like to call the lebron james of short selling, has been shorting tesla for over six years now, along the way he's been squeezed out of his short position many times. Nevertheless, he sees an end where he wins as one of the investors in the big short two to put the statement into reference. I'm sure many of you have watched the movie named the big short, where four investors bet against the market in the 2008 recession and make a boatload full of money in an article titled investment guru, channel swarns, the big short coming again channel stated this market is Setting up to be one of the great short opportunities of all time, trouble's coming, i don't know when, but it's coming in this article, he describes the current situation as the quote-unquote golden age of fraud.

To many of you, chenos's argument likely seemed baseless and rightfully so there was no clarification on where the fraud lies. On the other hand, david einhorn, the manager of greenlight capital, actually details. The reasoning behind his argument in the second quarter of 2020 einhorn's fund only returned one percent compared to the s p. 500 return of 20.5.

This was partly due to the facts that einhorn purchased tesla, put options in may and also refused to cover his short position when tesla stock dipped in march. Now, let's go over einhorn's accounting argument. Back in 2019, fiat chrysler struck a deal with tesla in order to avoid european emission fees. This deal was compensated with credits paid by fiat, which would total up to over 2 billion dollars when fiat paid these credits over the past few quarters, tesla didn't automatically book the profits of fiat's credits.

This according to einhorn, was purposely delayed so that tesla would enter the s. P 500. einhorn stated that, through what appears to be sheer abuse of the accounting rules, tesla has now contrived reported profits to make it technically eligible. While it is true that tesla has delayed some credits paid by fiat, einhorn's reasoning behind this doesn't seem to make sense in the first and second quarter of 2020 tesla booked a profit of over one and two dollars a share respectively.

Even with the reduction of a portion of the regulatory credits that were delayed, tesla likely still would have booked a profit leading the company to qualify for s p 500, a b bernstein, an investment firm, which has been bearish on tesla for years now still doesn't get The facts that tesla is not a car company to be this nearsighted is quite ridiculous, as in q2, 2020 tesla's mega pack made a profit for the first time and elon musk has also emphasized that tesla will begin, focusing on ramping up solar panel installations. So, to get to 900 a share, which is our price target. We have to believe that tesla sells six million cars per year in 2030. That's uh more than the combined size of mercedes and bmw today, and we have to believe it becomes the size of volkswagen, which is the largest car maker in the world by 2050..

Keep in mind that this is the same guy who said six months ago, that apple was worth under 200 a share, as he claims that apple was an overvalued hardware company. It almost seems as if bernstein is paid by gas companies to spew out this nonsense as he seems to consistently believe that companies can only sell in one sector. For years, we've seen the media constantly turn against tesla, whether it's business, insider cnbc or seeking alpha. One of these reporters, tim higgins, who works for the wall street journal recently, came out to publicly announce his bias against tesla.

Well, since the stock split was announced, i mean you've seen that giant increase and there hasn't been any fundamental change to the business uh. That would justify such a huge uh increase, but really it underscores just the idea that there are a lot of retail investors who are excited to be in the story, and this is a story stock uh even going back to the beginning. It's the the sale of this is the future of transportation, and it's a lot of ways uh, like the way that elon musk sells his cars through viral marketing and enthusiasm uh through people who are excited about that future. The notion that retail investors are the ones pumping up tesla stock isn't entirely true.

We've seen many institutional investors turned bullish on the stock over the past few months from the skeptical dan ives at webbush to the more traditional investor bob lutz. On top of that, there's also a continuous cycle of short squeezes leading to price increases. The other point that higgins makes here is that tesla stock remains as a story, which makes no sense. Evs are inevitably going to become the future of the automobile market as battery costs continue declining and energy density increases.

This isn't just the hope that evs will be the future of transportation. Evs are the future of transportation. Let me know what you think about the tesla short sellers in the comment section below. If you enjoyed this video, please hit the like button and subscribe and i'll see you in the next one.