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Tesla, Truth Social and Research in motion

Tesla and Truth Social are two strange animals in the US stock market.  First, Tesla has seen terrible operating performance and massive stock grants to its CEO and founder.   The world's single largest stock granted by a 20x order of magnitude.   Yet the company goes from weakness to weakness, and fails to deliver on new products.  The cybertuck is a disaster, the Y and the 3 are not leading the market anymore with falling sales, other brands such as BYD are doing a lot better across the world (not only China).   

As for Truth Social, its performance continues to disappoint with massive operating losses, and now the rumors that it will be acquired by an American company active in the nuclear power plant business (Not a single nuclear power plant has been built in the US in nearly 40 years…).  Yet the stock is still trading around $14.00 (the company generated a $55 million loss in the last quarter, and has not generated a profit since inception – nor is there guidance to future profitability).

Both stocks defy logic, Tesla is now around $488 or a p/e of 388.  A historical peak for the company.   Now unlike Truth Social Tesla is profitable, but the price of the stock is supposed to reflect the future income of the company, and it's hard to see what Tesla offers going forward, nevermind the lawsuits, a slowing US economy and the shine being off electric cars in the US are an indication that things are looking hard for the automotive sector in general and Tesla in particular.  

My point is simple, these two companies' share price is disconnected from reality, and it's not clear why.   The first is an ok company with declining sales in its core markets,, the second well its not clear what its objective really is, since profits is not it! If I had to characterize Tesla it is the Research in Motion of 2025, a dominant player that got lost and is still cruising at altitude based on past glories…


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