jeudi 21 avril 2022

"Everything Elon Musk touches turn to gold"

I'm still shocked by how so many investors think.

For instance, because Elon Musk is the wealthiest man in the world, everything he touches will probably turn to gold... in the mind of some people. 

However, any investor who digs balance sheets before investing knows that Tesla has a very very very esoteric valuation. That stock is not in the same universe as 99% of stocks available. It's a case of "In Musk we trust" more than anything else. 

Twitter is a little more in a rational universe, but that company still loses money on a regular basis. Losing money means negative margins, negative ROE and negative PE. 

As fascinating and mysterious and intelligent and awkward Musk is, he's got a lot of money in unorthodox companies. 

I would never advice anybody to invest in Tesla or Twitter. Actually, I'd rather advice people to invest in a stock where the CEO is a very quiet guy, like Constellation Software's Mark Leonard. 

Quiet people usually stay away from scandals. They don't live to provoke. I'm sure that Musk likes to provoke people. That makes a good show. But does any investor wants to own shares of a company run by someone who likes to create polemics on Twitter? 

3 commentaires:

  1. Elon is the GOAT. Stop hating. He's the reason Tesla has zero marketing costs. He can say and do whatever he wants because he delivers.

  2. Actually I'm not a fan of these 'Rock-Star CEO's' myself...

    Peter Lynch covered this area very well in his first book, One Up On Wall Street...

    And there was another book written afterwards focusing exclusively on the major traits of highly successful CEO's. It was an outstanding book that taught me a lot about what to look for in the senior management of a company. It was written by William N. Thorndike Jr and was called, The Outsiders...

    I prefer CEO's with low profiles and smaller egos. Mark Leonard (Constellation Software) and Bruce Flatt (Brookfield Asset Management) come to mind as well as Charles Brindamour (Intact financial Corp.)...All three of these guys have outstanding track records while keeping quiet about it...
    The CEO along with his senior management team are a major area I look at it before investing in a company...

    Just my two cents...

  3. He more than touches, he grabs !!