Tesla Stock 'Engineered, Not Earned,' Says Gordon Johnson As Call Buying Surge Drives Put-To-Call Ratio Down
News Summary
Analyst Gordon Johnson alleges that Tesla (TSLA) stock prices are being artificially supported through options market manipulation rather than fundamental performance. He cited aggressive call buying, which drove Tesla's put-to-call ratio down from 0.85x to 0.67x in a single day, indicating increased bullish options activity despite abysmal news. The report also highlights growing consumer distrust in Tesla's Full Self-Driving (FSD) technology, with nearly half of surveyed Americans believing it should be illegal and a majority preferring autonomous vehicles that use both LiDAR and cameras. Furthermore, Tesla's global market share is eroding, with European sales dropping 40.2% year-over-year in July, while Chinese competitor BYD Co. Ltd. surged 225% in Europe, surpassing Tesla's market share.
Background
Tesla Inc. has long been a leader in the electric vehicle (EV) market, known for its innovative technology and disruptive business model. However, its high valuation and the controversial statements of CEO Elon Musk have led to significant stock volatility and frequent debates between bulls and bears. Full Self-Driving (FSD) technology is a key selling point for Tesla, but its safety and practical capabilities have been consistently questioned by regulators and the public. Concurrently, the global EV market is experiencing intensifying competition, particularly from Chinese manufacturers like BYD, which are increasingly challenging Tesla's market share.
In-Depth AI Insights
Does the current market enthusiasm for Tesla truly reflect its fundamentals? - Johnson's argument cuts to the core: market support for Tesla's stock may be disconnected from its fundamentals. Against a backdrop of earnings pressure, intensified competition, and declining FSD trust, a high P/E (193.51) and surging call option activity suggest retail or institutional investors might be using options for hedging or pure speculation, rather than rational expectations of future cash flows. This could create a fragile bubble, posing significant adjustment risks to the stock price once options liquidity dries up or fundamentals deteriorate beyond ignore. What are the long-term implications of the FSD trust crisis and declining market share for Tesla's moat? - FSD is critical for Tesla's diversification and high-margin profitability, but low consumer trust and preference for alternative technologies (LiDAR + cameras) severely limit its commercialization prospects. This not only hinders recurring software revenue but also risks brand reputation. Concurrently, BYD's ascent in the European market indicates Tesla's competitive edge in key growth regions is eroding, posing a long-term threat to its global leadership and growth narrative, forcing more resource allocation to maintain share, thus squeezing margins. How might options market activity be used to sustain stock price, and what are the potential macroeconomic risks? - In 2025's high-interest-rate environment and increased global economic uncertainty, aggressive call buying could be a short-term speculative strategy or an attempt to drive prices via a "gamma squeeze." If a large volume of call options are bought, market makers must purchase underlying shares to hedge, creating a self-reinforcing upward price spiral. However, this strategy can collapse quickly when market sentiment reverses, leading to sharp declines. Under the Trump administration, regulatory scrutiny on tech giants, particularly regarding market manipulation concerns, could tighten, adding an extra layer of regulatory risk to such practices.