Gerber Sees 'Very Exciting Year for Tesla'

I think we got. Ross Gerber, president and CEO of Gerber Kawasaki Wealth and Investment Management, joins us on the on the phone from Santa Monica, California. He's on Twitter at Gerber Kawasaki. Ross. Good to have you with us this afternoon. Thanks for taking a break from digging through the twenty nine pages of earnings that we got from the company. Um, what sticks out to you because we got shares down about four point seven percent in the after hours. Yeah, it sticks out as an amazingly good

quarter considering the operating environment. I was like super excited to see that not only a second Ross where shares her down four percent? Right now? What's so amazing hours? We haven't had actually heard the conference call yet, and I think what we're going to hear in the conference

call is that Cybertruck production. So there was a big change in the in the charts that they put in the release and and where they put where each vehicle is in production, they change Cybertruck and Semi, so it now says that Cybertruck is now tooling and Semi truck is in early production. This is a massive change for Tesla in their future now that they are officially announcing

the beginning of production of their truck business. And that's what we're going to see in the conference call and once the goofballs in the after hour trading here this stuff, and you started thinking about numbers for Tesla when these factories are at a production level where they're not eating so much capital and you're looking at a very exciting

year for Tesla next year. Well, and you know, I'm going through a live blog which is such great UM analysis because it just pulls on so many different people from across the Blueboard universe that covers Tesla, and it says one thing that we're hoping to get a bit more color on during the call. Teslas as it continues to expect fifty average annual growth and vehicle deliveries over

a multi year horizon. That's their words, not explicitly saying it will hit that target this year and are down the hole saying Tesla will need a big fourth quarter to hit that rate for two. What's your analysis on that? Well, my analysis is that they will be around that rate of return of growth UM over the long term, just

based off their factory growth and installation UM. I. I really think it's kind of like what happens every year with Tesla, where they're just a little bit shy of their number, so they'll end up growing forty eight percent set of fifty and everybody say, oh, look at the big miss. And I'll say, can you name any company growing at fifty percent that's eight hundred billion dollar company?

And they'll say no. And I said, there's very few small companies growing at And so I think people have to keep in mind this amazing growth from this company that can grow fifty into this I you know, boy, it's impressive when your voice goes up in octave when you're talking about test, well, it's crazy. It's crazy numbers.

You know, I did an Apple thing. I started with Apple as a kid, and I remember when the iPhone came out and and everybody poopooted, or when Netflix came out and everybody said, oh, they'll never get to two million people and all this kind of stuff. And you're seeing when Tesla started, and we started with Tesla, all the naysayers will never make cars, will never make them in scale, And now we're talking about can they achieve

fifty growth in the next five years? Every year? It's like this is incredible, right, Yeah, And I should say that just looking at our blog, battery supply fingered as a key constraint on EVY growth. Hey, Russ, let's talk a little bit about average selling price on our livelog. We've got a great one going. Danni Hole, who's autos

reporter along with Seawan mu kain Um. She's noting that Gene Munster from Loup says that average selling prices were lower than expected, which could explain why they missed on revenue. Are you seeing some pricing pressure give in? There is so much competition or there there will be so much competition for Tesla vehicles evs moving forward? No, No, I mean, why do you think that was a mess there? The

average selling price was lower? Why is that? Um? I think that First of all, I don't know if that's true. I might have to do with the actual car mix, because they might have sold a lot of the low end cars to the to the rental That's what I was thinking too. And stuff, some Model three is going to them and they have to fill some of the order to her hurts and stuff, you know, like you can't just like not make them and those cars. I think we're priced around fifty not the average selling of

a model wise, more like sixty five or seventy. You know. Um, so you know you have to look at auto mix. But once again, I think we spend a lot of time looking at minutia in numbers, which I'm not saying that there's no value in it. There is some value in it. But you've got to look at the tree, not just the leaves here. And this tree is growing like amazing easingly well, and and so there's little things

you can nitpick out. Why don't they nit pick at the three point two billion in cash flow, which is up substantially from last quarter, I mean just their cash flow. Look at their cash on their books going up over two billion dollars, three billion dollars of cash added to the books. I mean, this is a highly profitable company as they grow at a very high rate. I mean

these are important things for investors to to really think about. Alright, talk with Ross gerbera founder president and see at Gerber Kawasaki Wealth on Investment Management on the phone from Santa Monica, California. Hey, so help me out here. Ross. The stocks down, as we said, three percent after ours, We'll see what the

trade is tomorrow. It is down about this year. Um. Part of that, you know, let's not forget there's a backdrop of Elon musk billion dollar bid to buy Twitter and concerns over slowing economy, higher inflation, rising interest rates. There's a lot of macro issues at play. Would you be buying either in the after hours or potentially tomorrow if the stock is down? Well, I never buy anything in the after hours, and I caution investors to do that because it's such an a liquid market. So I

think it's it's a dangerous thing. But we are typically buyers of Tesla when the valuation reaches this level. I personally, you know, have recently added to my personal Tesla position in my fun g K it is you know, our largest position as well. And I think for investors that look at the valuation of Tesla today and it's growth rate, I think that it represents a very good opportunity for investors who want to buy the stock and own it

for the long term. Tesla has risks like all other companies, but they've executed marvelously in an extremely difficult operating environment. And I think as the environment gets easier next year, because it will, Tesla is going to be in a wonderful place. So investor investors have to think about the next year or two, not the next month or two. And I think if you look at Tesla from that perspective, there are no other companies in the world that can compare.

What's interesting, though, is in the next year two we're going to be seeing new EV models from four GM, Volkswagen, not to mention the higher end players as well, Mercedes. It's not just Tesla, right, They're not the only game

in town anymore. So how does Tesla compete there? And I'm talking in the long term here, Ross, So there's two issues in one is you're absolutely right, and there are so many cool evs coming out from companies like poll Star and ribby In and Ford and and many others, even the Volkswagen I D four I'm seeing around, you know. But what's happening is people are replacing gas cars. They It has nothing to do with like, oh I'm gonna

buy this EV or that evy. It's it's it's that they're leaving the gas cars and they're all going to e vs. So every company that makes an e V is going to sell the EV and it doesn't matter who it is. Who's really the losy. Here are companies like range Rover that don't have an EV that now are competing directly with Ribby in for example, and Rivian's are beautiful cars that in my mind, is really going to take rain Drover's business, not Tesla's business. You see

what I'm saying. And then the second mode that Tesla has is the software. You know, you mentioned that I drive a Tesla, and I was about to say, well, half the time I don't drive the Tesla. I don't think you should say that. The Rossow that really drives me, you know half the time now on l A city streets, and so we're not far away from a real big you know AI. So if I see you out on the road, go the other way, Ross, So you're saying, honestly truth is my wife prefers autopilot over from Yeah.

I think I could see that with my husband, or he could see it with me, that's for sure. Russ Garbera, thank you so much, President CEO G. Kawasaki Wealth and Investment Management, on the phone from Santa Monica, California. Tesla share still down about four percently after market