Shorts want the market to "figure it out quickly" on par with children's tolerance for long trips strapped in a device suitable for space exploration. If Musk sells the long-term dream, the trip may feel like sitting in the back of a 1971 Oldsmobile station wagon traveling along at 55 MPH before the days of DVD players wondering "are we there yet"?
Absent Musk's ability to cultivate a solid decade-long investor mentality, which is rare on Wall Street, shorts will receive a "yes," and likely before 2014. For new investors, the only reason to buy is if you think the potential price appreciation outweighs the risk. With the stock now at around $118, that seems unlikely unless you're an active day trader.
Bottom line: Tesla is trading at a nose-bleed valuation while its chart appears to be extended and close to exhaustion. Investors should fasten their seat-belts and use caution or risk leaving their portfolios in the dust.
At the time of publication the author had no position in any of the stocks mentioned.
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