NEW YORK (TheStreet) -- Shares of Tesla (TSLA) and SolarCity (SCTY) were higher in late afternoon trading on Thursday, as the two companies' shareholders vote on the proposed $2.6 billion merger. Analysts expect the deal to pass.
Cabot Wealth Management CIO and Tesla shareholder Rob Lutts joined CNBC's "Power Lunch" this afternoon to explain why he voted in favor of the merger.
"We buy into the vision that Elon Musk has set out," he said. "We think solar power should be generating electricity for cars in the future and putting these two companies together down the road is really going to seem like a very good idea."
Tesla makes about 2,000 cars a week right now, but the firm expects that to rise to about 8,000 cars a week a year from now, he noted. At that point, "this financial decision will seem like a very small one."
The orders on Tesla's future Model 3 sedan prove that its CEO Elon Musk has the "vision" to know what American consumers want, Lutts added. "Name me a company that's ever had 400,000 people put down $1,000 down to reserve a car two years before it's made. This is what the American people want."
Earlier in the show, Axiom Capital managing director Gordon Johnson said that the deal was "absurd" because SolarCity has cash flow problems and because Tesla's proposed battery initiative could make SolarCity's core business of net metering obsolete.
"I think all of his arguments are very short-term focused," Lutts said in response.
Separately, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author.
TheStreet Ratings team rates Tesla as a Sell with a ratings score of D+. This is driven by a number of negative factors, which the team believes should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks the team covers.
You can view the full analysis from the report here: TSLATSLA data by YCharts