TSLA Stock Slides Overnight: Ross Gerber Calls Tesla 'Worthless' Without SpaceX Merger As Retail Bets Rise

• Gerber said a Tesla-SpaceX deal is a "foregone conclusion" and believes merger expectations are driving Tesla's valuation.
• He criticized xAI's structure, saying Tesla's chips and engineers helped build technology now owned outside the automaker.
• Despite remaining bullish on SpaceX, Gerber urged investors not to chase the stock and to wait for lockup expirations.

Shares of Tesla, Inc. (TSLA) slid over 1% overnight late Monday, as investor Ross Gerber claimed the EV maker is "worthless" without a merger with SpaceX (SPCX), while retail traders increasingly bet that CEO Elon Musk's two flagship companies will eventually combine.

TSLA stock jumped over 1% on Monday, marking its third straight session in the green. Meanwhile, SPCX stock extended its post-IPO rally, climbing another 20% in its second trading session and adding $420 billion in market value. Shares closed at $192.5 on Monday, 43% above their IPO price, pushing the company's valuation above $2.5 trillion.

Why Gerber Calls TSLA 'Worthless' Without SPCX

In an interview with Bloomberg, Gerber said he believes investors are increasingly treating a Tesla-SpaceX merger as inevitable. "We know this is going to happen at some point," he said. "I think it's definitely a foregone conclusion." 

Gerber added that expectations for a future merger are driving Tesla's valuation, as shareholders do not want to miss out on potential exposure to SpaceX. According to Koyfin data, Gerber Kawasaki Wealth & Investment Management holds about a 0.03% stake in Tesla valued at more than $90 million. 

Gerber's biggest concern is regarding AI and the ownership of the tech underpinning Tesla's future products. According to him, Tesla resources helped build xAI, which now sits outside the automaker despite powering many of its most important growth initiatives. "They took Tesla's chips and Tesla's engineers and built XAI," Gerber said. "That's super wrong."

He said that Tesla's self-driving and robotics ambitions also rely on tech the company does not fully control. "Elon goes on TV and says this is the entire value of the company is based off if we can succeed with full self-driving. But yet the brains of full self-driving isn't owned by Tesla," Gerber added.

"Tesla, in my mind, is worthless if it doesn't merge because it doesn't own the IP to the brains, to their own products."

Gerber: Don't Rush Into SPCX Stock

Despite his bullish long-term outlook on SpaceX, Gerber cautioned investors against rushing into the stock after its blockbuster debut. "You've got plenty of time to get into SpaceX," he said. Gerber said investors eager to gain exposure should build positions gradually rather than buying all at once. "If you really, really want it ... buy 20% of what you want to buy today," he said. He also pointed to upcoming lockup expirations as a potential opportunity.

According to Gerber, some longtime employees may eventually sell shares to buy homes or improve their financial security, creating additional supply in the market.

Gerber, who personally owns SpaceX shares through his earlier investment in the Twitter take-private deal, said he remains a long-term holder. "I'm not selling it," he said. He credited SpaceX's success not to Musk alone but to the company's workforce. "These are the highest caliber engineers in the world," Gerber said. "It's not Elon Musk that's made SpaceX successful. It's the people there."

How Do Retail Traders Feel About TSLA?

On Stocktwits, retail sentiment for TSLA slipped to ‘neutral’ from ‘bullish’ levels a day ago amid a 216% jump in 24-hour message volumes. A recent Stocktwits poll showed 61% of respondents expect SpaceX and Tesla to merge within the next five years, compared with 29% who said they do not.

One user said, “$SPCX expensive even for a bubble. It makes $TSLA extremely cheap in comparison.”

Another user said, “$TSLA With $SPCX looking phenomenal it's a matter of time for TSLA to tag along and follow the up trend! Heading to $420!”

So far this year, Tesla's stock has lagged its "Magnificent Seven" peers, making it the group's third-worst performer, down about 9%. Even so, Tesla continues to command a premium valuation, trading at a forward price-to-earnings ratio of roughly 190x, by far the highest multiple among the Magnificent Seven stocks.

For updates and corrections, email newsroom[at]stocktwits[dot]com.

Read Next: DXYZ, NASA, VCX Slip Overnight: SpaceX IPO Buyers Get Tiny Allocations, Rush To Take Profits