Here's what happened:
Yes, traditional money on Wall Street, funds, money managers, etc. think in a very formal, regimented, restricted manner. I call it stupid although they are not really stupid (but that is essentially how it plays out in situations like these). They have to model the most likely earnings looking forward to assign value to the shares today. They cannot model things that don't fit their model. That means any talk of humanoid robots they don't know what to do with. Any talk of FSD, they cannot put in their spreadsheet. How do you model "nutty"? But the worst part is, once Elon said the economy car was not being worked on and the Cybertruck has a somewhat nebulous timeline, they can't model revenues for those things either. And they can't understand that the market has huge ability to absorb far more Model 3's and Model Y's than current sales/production. So they can't model that many of each car model because that would make both of them the best-selling cars, period. Gas or electric Yet EV's are only 6% of global sales. They can't compute this. They think Tesla needs more car models to distribute the volume of sales Tesla is forecasting because that's how the auto industry works.
That means TSLA ownership is only for those who "get it". Meanwhile Tesla will continue to build production capacity which will result in quarter after quarter of record sales. As the new factories ramp into efficient production their margins will be crazy high because they didn't spend a bunch of money spreading their production around more models than necessary. He even told us the 4680 cells are ramping up as we speak, both in-house and at partner factories, and it flew right over the heads of those who sold/decided not to buy. Remember, it's all about the batteries.
I can't say how long it will take for the price to recover, but eventually reality will start to sink in and the price will get bid back up. My feeling is Elon purposefully disenfranchised anyone too idiotic to see what is happening right before their eyes. He really doesn't give a flying frack because he doesn't want to work for people like that (yes, he works for shareholders). He knows he is going to make a lot of people very wealthy and he thinks it's better if it goes to the kind of people he likes rather than those he despises. The beauty of all this is it didn't require anything but pure honesty from Elon. Sure, he might have hammed it up a little bit but essentially, he was giving us the straight scoop on how nutty the profits are going to be and giving the finger to those he doesn't like.
But that's not all. Elon works his magic by taking actions that solve multiple things at once. And a low share price is good for Tesla's next phase of expansion in terms of attracting talent. Elon doesn't give all this much thought because he's a visionary. He just sees the future he wants to create and takes steps that sets big things in motion, that pushes towards the desired outcome. It's not a cold, calculated, if A, then B. This is what vision is and he doesn't fret over the details. He doesn't see this in words in his mind, it happens in cascades of visions. It's the source of his particular form of magic. It's not really magic but the superior results he delivers can make it look like magic to someone who doesn't understand how he can accomplish so much, how things seem to go his way an inordinate amount of the time.
A conventionally thinking CEO judges they did a good job on a conference call if the share price rises during and after the call. Higher share price is good, right? Success! Elon takes a bigger view. He did well on the call if he sets off a chain of events that allows greater success down the road. He needs to get the dominoes lined up. Because he knows true success is not a high share price. True success is hard. It's the success that made that high share price possible and we are still in the early stages. I'm sure there is a lot more depth to his vision than I'm even aware of. He's probably killing 3 or 4 birds with one stone, Part of it might simply be because it's more fun being CEO of Tesla when he can draw out the doubters and naysayers and them give them a good slapping. He's not worried because he knows the share price will eventually take care of itself.
It's not the first time he's done this. Those who like non-volatile stocks or need some handholding on future projections can shop elsewhere, for everyone else, it's a buying opportunity. This is why I focus on the company's execution rather the share price.
