Many Tesla Short Sellers Are Giving Up

Most of Tesla’s ($TSLA) short sellers are giving up, Bloomberg reports. The article stated that Tesla is inflicting more pain on short sellers and cited data from S3 Partners which shows that short interest, which is around 3.2% of the float, is at its lowest ever. Ihor Dusaniwsky explained that there’s been some short covering in Tesla recently. Shares that were shorted have decreased by 1.5 million shares which equals to $1.20 billion over the last month.

The pain, Bloomberg noted, is about to intensify. This is due to Tesla’s record Q3 delivery numbers, which Wedbush analyst Daniel Ives, described as “a major feather in the cap for the bulls.”

“While there are many competitors in the EV space, Tesla continues to dominate market share as evidenced again this quarter while battling through the chip shortage.”

The Bloomberg article is an echo of one that I have written earlier this year in April. Tesla bears, or people who expect the stock’s value to go down and/or are against a particular stock of company and are rooting for it to go bankrupt, as we’ve seen in Tesla’s case, are losing the war they have waged against Tesla.

My article covered the thoughts of Nasdaq writer Martin Tillier, who inspired my own thoughts. I’ll quickly recap:

“I know and understand that that gives me a subconscious bias no matter how hard I try to be impartial, which is why I declare my interest. I sometimes wonder, though, what excuse the Tesla permabears have.

“After all, every reason they have given over the last few years not to buy TSLA, or to short it, has been shown to be wrong (and in the case of shorting the stock, disastrous). Yet they still keep coming up with new reasons for being bearish against TSLA.”

He mentioned that as time passed, Tesla’s products and its drive to succeed spoke for themselves — a drive born from Elon Musk’s leadership.

“They navigated that steep path with the help of investors, and the negative headlines were shown to be sensationalism at its worst. Those stories pointed out the remarkably few safety glitches in cars that had a much better safety record than their counterparts. After all, a ‘One Tesla Catches Fire!’ story every six months or so will draw eyeballs, if only because of its scarcity, while a ‘519 Gas-Powered Vehicles Catch Fire Today’ story would get boring after a while if reported daily.”

I built upon Tillier’s thoughts and pointed out that Tesla’s products also speak for Tesla itself — not just the products. During this fierce war backed by short sellers, Tesla never once lost focus on its objective or products. If anything, Tesla used some of the lies and mocking aimed at it to profit. For example, Elon Musk and Tesla Tequila. Mocking him for going ‘bankwupt’ led Tesla to create new product that is currently in a box on my shelf.

I had two, but I opened one and it’s all gone now. That aside, this wasn’t the first sign of the apocalypse for Tesla’s short sellers. In 2020, Tesla short sellers literally lost more money shorting Tesla than the U.S. airline industry during the first nine months of 2020. If you remember, we had a pandemic going on (still do) and lockdowns which forced many businesses including the airline industry to temporarily close down.

CNN interviewed Dusaniwsky as well and he said,

“There’s nothing that compares to it that I can remember.”

The Disinformation Campaign Against Tesla Will Eventually Fail

The disinformation campaign against Tesla is still stronger than ever. However, it too will prove itself to be seen exactly for what it is. Lies, FUD (Fear, Uncertainty, and Doubt) and outright biased articles that shine a negative light on Tesla’s achievements while promoting the idea that Elon Musk is a bad person.

A recent example of this is an article by Consumer Reports that used a tweet from a short seller who has called Elon Musk a ‘baby killer’ on Twitter. So, yes, the disinformation campaign is going strong, but it’s mostly fueled by the remaining short sellers who haven’t given up and their partners in various media outlets who entertain them.

Tesla has proven itself time and again. As a company, it has weathered a recession, a pandemic, the storm of FUD and intense shorting and is thriving. This is why many short sellers are calling it quits. Those who haven’t — especially those on Twitter making up wild lies about Elon Musk, Tesla, Tesla customers, shareholders and supporters (even me) are reduced to conspiracy theorist that rant online about how much they hate Elon and how we are secret Tesla agents.

Tesla and Elon Musk are winning. And so is clean energy.

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