- Reuters/Brendan McDermid
- David Einhorn’s $5.5 billion Greenlight Capital hedge fund lost 18.3% in the first half of 2018 while the benchmark S&P 500 was positive.
- Tesla was the firm’s “second biggest loser” he said, thanks to its 29% jump in the same period.
- Einhorn is swapping his Tesla Model S for a Jaguar I-PACE SUV, he told investors Tuesday.
- Elon Musk responded on Twitter, saying he will “send Einhorn a box of short shorts to comfort him.”
- Follow Tesla’s stock price in real-time here.
Billionaire hedge fund manager David Einhorn hasn’t had a fun year.
His $5.5 billion Greenlight Capital lost 18.3% in the first half of 2018, he told investors in a letter Tuesday.
The losses were exacerbated by Tesla‘s 29% gains last quarter – decimating Einhorn’s short position in the stock – making it his “second biggest loser” for the six-month period.
Elon Musk – Tesla’s chief executive with a noted disdain for short sellers- tweeted in response to the letter that he will “send Einhorn a box of short shorts to comfort him through this difficult time.”
“By all available evidence, the company has had a difficult year,” Einhorn wrote about the automaker in his letter, which was published by the finance blog Zero Hedge. “TSLA has had trouble demonstrating efficient production, and it has delayed capital spending which pushes out future growth opportunities in the Model Y and the Semi.
“TSLA is accommodating Model 3 customers who are willing to pay for premium features – making the car more of a luxury item with a smaller addressable market than the mass market car TSLA had promised. This high-grading of the backlog combined with the reduction in the government subsidy by early next year, new product delays and the emergence of viable competition for the Models S and X means that 2019 should be a very challenging year for TSLA. We doubt the entry-level Model 3 will be produced profitably anytime soon, if ever.”
Einhorn also said that he was pleased his Tesla lease had ended and that he was excited to get the I-Pace, which is Jaguar’s first electric SUV and powers Waymo’s fleet of self-driving taxis.
Tesla is scheduled to report its second quarter earnings on Wednesday after the closing bell. Analysts polled by Bloomberg expect the company to report an adjusted loss of $2.90 per share on revenues of $2.974 billion. Musk has repeatedly claimed the company will be profitable by the end of the year.
Tesla is down 6% this year amid increasing worries about a potential default, with insurance on its bonds, hitting their most expensive prices ever last week.
- Markets Insider