Every generation has its eccentric rockstars who do things that seem bizarre to most people. Benjamin Franklin invented a huge variety of gadgets and tools, but he also had a cosmopolitan attitude that was considered unconventional in Colonial America. Richard Branson, the founder of Virgin, is a genius marketer with a unique love for kite-surfing. Peter Thiel, Silicon Valley’s self-described contrarian, is a clever investor who finds it useful to disagree with the status quo.
These individuals are considered odd when compared to the average American. Their oddities may be what make them successful. Elon Musk is hardly any different from the eccentrics that we just mentioned. On Twitter, Elon Musk can seem like an unstable genius. However, Tesla’s stock prices demonstrate that Musk can secure the necessary funding to operate an innovative company.
Despite the success of Tesla, the company has come under intense scrutiny from the investing community because of Elon Musk’s behavior on Twitter.
Elon Musk’s PR Blunders
Some people believe that Elon Musk is unstable because he has a history of making bizarre comments on Twitter.
In 2018, a Thai soccer team was stranded in a quickly flooding cave. Elon Musk offered support and resources for the rescue operation. Oddly, Elon Musk also accused one of the rescue divers of being a pedophile. Musk did not provide any evidence to support his claim, so we can assume that the statement was simply an insult. Many people felt that the accusation was inappropriate.
Musk also made promises to correct water problems in Flint, Michigan. Due to a toxic spill, the water supply of Flint is unsafe for consumption. Musk did not attempt to correct the problem. It seems that Musk was taking advantage of an opportunity for free publicity.
In September 2018, Elon Musk was a guest on Joe Rogan’s podcast. During the show, Musk smoked marijuana while discussing the future of Tesla and SpaceX. Tesla’s stock suffered a slight drop after the incident.
The most serious issue with Elon Musk’s Twitter habit landed him in trouble with the SEC. Musk announced that he had secured funding to make Tesla a privately traded company. The SEC is investigating this incident because regulations require that information about stocks should be made available to the general public. Musk may have violated this regulation because social media is not a normal channel of communicating with investors.
Elon Musk’s Long History of Success
Elon Musk may be criticized for being irrational or unstable, but he has a long history of success. Tesla may be Elon Musk’s most famous consumer-facing brand, but SpaceX is also a company that people should keep their eyes on.
SpaceX is one of the first private space corporations to create rockets that can compete with the technology created by NASA’s Jet Propulsion Laboratory. SpaceX has revolutionized rocket science by mastering reusable rocket technologies. The company recently announced that it would be using its technology to transport a Japanese billionaire around the Moon. This event is an impressive publicity stunt that will bring Musk plenty of funding for his ventures.
Before Elon Musk started to create technologies that were once limited to science fiction novels, he was a cofounder of Paypal. Elon Musk worked with Peter Thiel to create one of the first forms of online digital payment. This was a revolutionary product that inspired cryptocurrency and other fintech breakthroughs.
Elon Musk also has innovative ideas about city infrastructure. With the Boring Company, Musk plans to create a form of rapid underground transportation. Known as the hyperloop, the subterranean transportation network is more akin to a ferry than a subway. Passengers of the hyperloop will drive onto platforms that are then transported to the final destination. Musk envisions a city where the surface paths are exclusively used by pedestrians.
Musk’s grandest and most famous goal is to establish a human colony on Mars. This is a particularly far-sighted goal that requires an explanation. Elon Musk sees Mars as the insurance policy of humanity. Humanity faces many existential threats. Nuclear warfare, climate change, meteor strikes, and another Ice Age could are plausible ways humans on Earth could become extinct. Musk aims to hedge these risks by creating a settlement on Mars. He prefers to not put all of humanity’s eggs in a single basket.
Musk is a visionary entrepreneur who has accomplished many feats during his career. His recent PR blunders should be forgiven by the public. Investor Paul Mampilly, the editor of Profits Unlimited, believes that people should pay attention to Musk’s track record of success. By following the data, investors will find that Elon Musk’s companies are sound investment options.
Investors Should Be Bullish on Tesla
Paul Mampilly is in a good position to give advice on Tesla. As the editor of a newsletter that has over 150,000 subscribers, Paul Mampilly is familiar with evaluating new developments to discover investment opportunities. Paul Mampilly received an MBA from Fordham University, so he understands the types of legal processes and investment decisions involved in a successful company like Tesla.
Respect Tesla’s Incumbency
Paul Mampilly has discovered that Tesla does not have many flaws that investors can point out when they criticize Musk. While Tesla has experienced output issues with its line of luxury-class electric vehicles, the company has led numerous breakthroughs in the clean-tech industry. For example, Tesla and its subsidiary Solar City have improved solar energy technologies by creating more efficient solar panels. Tesla has also expanded the storage capacity in its lithium ion batteries.
Tesla also holds a secure position in the market for solar energy and electric vehicles. Any firm requires a large amount of capital to enter the clean-tech industry. Tesla has already established economies of scale with its Gigafactory 1. With these initial investments, Tesla can offer lower prices relative to its competitors.
Follow the Data
Skeptics of Tesla should pay attention to how Tesla’s stock prices have changed over time. Since 2013, people who invested in Tesla enjoyed positive returns.
Past performance is a poor predictor of future performance, but the stock market data are favorable for Tesla. When Tesla first became a publicly traded company in 2010, a single share was traded at just $19. By September 2013, this figure climbed to $190. The Tesla stock reached an all-time high price of $383 by June 2017.
Investors like Mampilly expect the stock to fluctuate between $260 and $370 during 2019. Unexpected discoveries by the SEC and analysts may shift the price in either direction. However, bullish investors are confident that the stock price will soon approach $400. Following the data is the best strategy for this situation.
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