Ross Gerber Sees No Upside in Tesla: Here Are His Trades Instead

Ladies and gentlemen, buckle up! We've got a market mover on our hands. Ross Gerber, the CEO of Gerber Kawasaki Wealth & Investment Management, has just dropped a bombshell: he sees NO UPSIDE in Tesla stock. That's right, folks! The man who once championed Tesla is now sounding the alarm. Let's dive in and see what trades he's making instead.

First things first, why the sudden change of heart? Gerber has four major concerns:

1. Autopilot Network Targets: Gerber is skeptical about Tesla's ability to meet its ambitious goal of launching an autonomous ride-hailing network by June 2025. He believes this target is "almost impossible to achieve," which could lead to a loss of investor confidence if not met.

2. Dependence on Camera Technology: Gerber criticizes Tesla's reliance on camera technology for its autonomous driving system, arguing that this approach poses safety and regulatory risks compared to using LIDAR sensors.

3. Elon Musk's Focus on AI: Gerber is concerned that Musk's focus on AI and other projects is diverting attention from Tesla's core business, leading to slower car sales growth and increased competition from rivals like BYD.

4. Political Association with Donald Trump: Gerber worries that Musk's association with Donald Trump could alienate some customers and investors, potentially harming Tesla's brand image.

Now, let's talk about the trades Gerber is making instead. He's shifting his focus to the tech sector, particularly companies involved in AI infrastructure. In a recent post on X, Gerber noted that "every earnings report from the tech sector points to lots of infrastructure spending on AI… Bodes very well for the bricks and mortar companies behind AI." This shift is driven by the surge in AI-related activities within the tech sector, with companies like Microsoft and Alphabet's Google delivering impressive performances in the AI and cloud computing space.



Gerber has also been bullish on Nvidia, stating that "Nvidia has been a better investment than Tesla over the last 10+ years." He recommends treating Nvidia as a core portfolio holding alongside tech giants like Apple and Microsoft. This recommendation is supported by Nvidia's remarkable performance, with its stock soaring more than 180% year-to-date in 2024, surpassing Tesla's 73% increase during the same period. Nvidia's market capitalization has also pushed above $3 trillion, solidifying its leadership in artificial intelligence technology.

Additionally, Gerber has been involved in thematic and impact investing, focusing on transformative trends in technology, climate change, and consumer sectors. His firm, Gerber Kawasaki, employs a thematic approach to identify companies positioned to benefit from these trends, with an emphasis on those making a positive social and environmental impact. This strategy is part of their impact investing approach, which integrates environmental and societal factors into their investment decisions.

Gerber's shift in investment strategy is also evident in his recent launch of the AdvisorShares Gerber Kawasaki ETF (GK), which invests in growth companies set to benefit from long-term changes occurring in a post-COVID economy. The ETF focuses on nine investment themes, including climate change, technology frontiers, video gaming and esports, top consumer brands, pet and animal wellness, innovation in healthcare and biotechnology, real estate disruption, streaming sports and entertainment, and firms involved in previously illegal activities such as cannabis, online gambling, and sports betting. This ETF gives investors access to Gerber's best stock ideas across these themes, reflecting his belief in active management and stock picking.

In summary, Ross Gerber's current focus on alternative investments and trades includes the tech sector, particularly AI infrastructure companies like Nvidia, and thematic and impact investing in areas such as climate change and technology frontiers. His shift in investment strategy is driven by the surge in AI-related activities, the impressive performance of companies like Nvidia, and his belief in active management and stock picking. So, if you're looking to follow in Gerber's footsteps, consider these trades and stay ahead of the curve!