Tesla Should Boost Buybacks With Excess Cash, Says Gary Black: 'Valuation Is Why Tesla Remains Under Owned' - Tesla (NASDAQ:TSLA)

Core Viewpoint - Tesla Inc. should utilize its excess cash of $37 billion for stock buybacks instead of allowing it to accumulate further, as suggested by Future Fund LLC's managing director, Gary Black [2]. Group 1: Investment Strategy - Gary Black advocates for Tesla to buy back shares to enhance shareholder value rather than letting excess cash build up [2]. - Institutional investors are reportedly underinvested in Tesla due to its perceived high valuation compared to their estimates, rather than its volatility [3]. Group 2: Stock Performance Predictions - Black previously predicted a surge in Tesla's stock due to strong Q3 deliveries, but he now anticipates a decline in Q4 as the new affordable model may not meet expectations [4]. - Ross Gerber, co-founder of Gerber Kawasaki, also forecasts a temporary surge in Tesla's stock, suggesting that positive news may not last and could lead to a downturn in the following weeks [5]. Group 3: Market Reactions - Tesla's stock initially rallied after an SEC filing revealed CEO Elon Musk's purchase of over $1 billion in shares, pushing the stock price above $420 [6]. - Musk's financial recovery follows a period of criticism and declining sales after his support for President Trump [6]. Group 4: Company Metrics - Tesla scores well on Momentum and Growth metrics, while its Value metric is rated poorly, indicating a mixed performance in terms of investment attractiveness [7].