“Last quarter we ended our letter with a quote about Tesla. This quarter we begin with one from Dave Pell, editor of NextDraft: ‘It’s pretty amazing that we live in an age when a CEO of two public companies can give a talk about colonizing Mars and shareholders don’t see that as a warning signal,'” Einhorn wrote in a letter dated October 28.
He continued: “It’s not so amazing when one considers that those same complacent shareholders have been willing to look past years of over-promising and under-delivering from a promotional CEO. Elon Musk’s ability to spin a yarn and keep a story going seems to mesmerize his investors, blinding them to the challenges the company is facing.”
Einhorn has not publicly stated a position on Tesla.
However, he closed his second quarter letter in late July with the following quote: “’We believe Tesla’s most valuable asset may be the trust it has built with its providers of capital.’ — Adam Jonas (not one of the Jonas Brothers)”
Jonas is an auto analyst for Morgan Stanley.
Greenlight’s funds returned 3.4%, 1 net of fees, in the third quarter, bringing the year-to-date net return to 3.8%, the letter said. During the quarter, the S&P 500 index returned 3.9%, bringing its year-to-date return to 7.8%.
Tesla didn’t immediately respond to a request for comment.
ValueWalk first reported the contents of the letter.
Julia La Roche is a finance reporter at Yahoo Finance.