Stock Market

Tesla’s Trials and Triumphs: Why TSLA Stock Is a Contrarian’s Dream Come True

You can love it or you can hate it. Either way, it’s hard not to have an opinion about electric vehicle manufacturer Tesla (NASDAQ:TSLA). Currently, the prevailing sentiment is very negative about TSLA stock. If you’re a true contrarian investor, though, then now’s a great time to pick up some Tesla shares.

Granted, it might be difficult to invest in Tesla with confidence if you’re concerned about the company’s mercurial CEO, Elon Musk. So, you’ll have to weigh the chief executive’s tendencies against the company’s growth potential. In the end, you might be willing to overlook Musk’s eccentricities and allow Tesla stock to have a place in your portfolio.

TSLA Stock Is Down, but It’s Not the First Time

After starting 2024 at around $250, TSLA stock recently fell to $163 and change. This represents a share-price dip of around 34%.

There’s a precedent for this type of price action, though. Tesla stock got cut in half in 2022 and hardly anyone was enthusiastic about buying it. Yet, that turned out to be a terrific buying opportunity. You could have bought Tesla shares at the end of 2022 and doubled your money within a year.

So, the current blood-in-the-streets moment with TSLA stock should appeal to contrarian investors. Ark Investment Management CEO Cathie Wood appears to be taking advantage of the situation, as her fund recently purchased 216,682 Tesla shares.

On the other hand, Gerber Kawasaki Wealth & Investment Management CEO Ross Gerber doesn’t seem eager to buy the Tesla stock dip.

Gerber evidently isn’t full-on bearish, but he wants Musk “just to shut up.” Furthermore, Gerber hopes Tesla will get a “real CEO who’s actually going to help the company” and promote the Tesla “brand in a positive way.”

Tesla: Fast-Growing Company vs. Controversial CEO

So, should investors dump their TSLA stock if they think Musk is obnoxious? That’s a personal decision that you have to make. However, if you’re willing to focus on the company rather than on Musk’s unusual behavior, then you can still consider taking a share stake in Tesla.

At least one prominent Wall Street expert seems willing to give Tesla a chance despite the CEO’s quirks. Specifically, Wedbush analyst Daniel Ives recently declared that he’s “firmly in the bull camp on Tesla.”

I tend to concur with Ives’s argument. He predicted about Tesla, “On the other side of this, this will be a company on its way [to] two and a half, three million units.”

That’s not an impossible goal. As you may recall, Tesla’s vehicle sales increased by nearly 40% year over year in 2023 to 1.8 million units. You’d be hard-pressed to find another EV-focused automaker that sold anything close to 1.8 million vehicles last year.

I view Tesla stock as the no-brainer bet for EV-industry investors, and Ives seems to feel the same way. He forecast, “When we look at the next few years, they will gain more share, the leverage will be there, and I believe ultimately numbers, EPS, growth, will come back up.”

TSLA Stock Will Recover From Its Drawdown

Perhaps it’s understandable if Gerber is frustrated with Musk. However, Tesla is an EV-market juggernaut that sells a lot of units.

So, are you prepared to look past Musk’s behavior? And, do you agree with Ives that Tesla’s numbers “will come back up?”

If so, then now’s the right time to invest in Tesla. I view TSLA stock as a buy and expect it to recover fully from the current share-price drawdown. It’s really just a matter of time — and a question of whether you’re willing to tolerate Tesla’s ever-controversial CEO.

On the date of publication, David Moadel did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the Publishing Guidelines.

David Moadel has provided compelling content – and crossed the occasional line – on behalf of Motley Fool, Crush the Street, Market Realist, TalkMarkets, TipRanks, Benzinga, and (of course) He also serves as the chief analyst and market researcher for Portfolio Wealth Global and hosts the popular financial YouTube channel Looking at the Markets.

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