Saturday, September 23, 2023

Alex Stamos: Elon Musk Might Lose Control Of Tesla

  • An ex-Facebook executive warns Elon Musk that activist investors could be coming after Tesla’s stock plummets.
  • Tesla shares have plunged by more than 60% this year.
  • A major shareholder of Tesla said Thursday that the company needed a CEO more like Apple’s Tim Cook.

Former Facebook security chief Alex Stamos warned that activist investors could start buying up Tesla shares — and even attempt to wrest control of the company from Elon Musk — if the electric car maker’s stock doesn’t start to turn around: It’s down more than 62% so far this year.

Activist investors buy up big stakes in public companies and then agitate for change — sometimes in the board room.

“If it continues to drop this hard, then you’re going to end up with activist investors getting in, and those activist investors are going to push to get onto the board and then to put pressure on Musk — or even to maybe kick Musk off as CEO,” Stamos said of Tesla’s big stock drop in an episode of the “Moderated Content” podcast that was publishedMonday

If an activist does come along — and so far, there’s no indication of that happening — they could finally “be the brake on Musk’s behavior,” Stamos said, pointing to his controversial reign as Twitter’s chief so far. Stamos stated, “That might be what kind of slaps his face in the face of whether it’s worth it to do that.”

Insider reached out to Musk and a Tesla spokesperson but they did not respond. Stamos was previously Chief of Security at Facebook. He was also previously Chief of Information Security at Yahoo. He last spoke out against rumblingA activist investor trying oust a founder. Some people were making noises that Mark Zuckerberg should be removed as the top Facebook executive in 2019. 

Stamos made the comments after Musk made a series of erratic statements on Twitter — from calling for White House chief medical advisor Anthony Fauci to be prosecutedmocking the LGBTQ+ community insinuatingYoel Roth, Twitter’s former security chief, has a permissive view on pedophilia. Insider asked Stamos not to comment before publication.

Tesla shares have dropped to their lowest value since November 2020 over the past week. The stock of the electric-car maker has dropped more than 60% this year due to falling demand from China and Musk’s preoccupation with Twitter.

Some Tesla investors made some big investments last week expressed concernMusk’s CEO felt that Twitter was becoming too distracting. Musk continued to work. sold more of his Tesla holdings to help fund his $44 billion Twitter purchase on Wednesday — offloading nearly $40 billionTesla stock has seen a 14-month increase in value. Tesla stock traded at a little more than $150 per share late Friday.

Stamos isn’t the only one to warn that Musk could be in trouble. Leo KoGuan, a major Tesla shareholder, spoke out Wednesday. called for a new CEOTo takeover. KoGuan has amassed about 22.6 million Tesla sharesas of September We don’t know much about his spending habits, but according to BloombergHe’s been making donations to Chinese universities for years.

He called himself “Elon’s fanboy” in an an interview with ForbesLast year, but he has since changed his tune.

He said, “An executioner Tim Cook-like is necessary, not Elon.” tweeted. KoGuan said that an executive like Apple CEO, who is known as a quiet operations genius and would be a better fit for the job, saying that “Elon abandoned Tesla.”

Wedbush analyst Dan Ives claimed that Tesla was a “very good company”. ripe target for activist investorsThe company will likely face increased pressure from activist shareholders in 2023 to start a stock buyback program or improve profit margins. Ives was critical of Musk’s preoccupation with TwitterIn the past. However, the tech analyst stated in a Thursday note that he retains his outperform rating for the stock because of his optimism about the future of EV manufacturing.

Insider was told by William Klepper, a Columbia Business School management professor, that Tesla’s board must step up and bring Musk’s attention back to Tesla. He also warned that activist investors could infiltrate the company. 

Klepper stated that Tesla’s stock price drop was due to “the market speaking to the board”. It’s as simple as that.

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