Gary Black

Managing Partner, The Future Fund LLC, SEC registered investment adviser. CEO/CIO/PM. Disclosure:

[Gary Black @garyblack00]

Some basic lessons for new investors to live by:
1/ Ignore the crowd. You make money by going against the consensus.
2/ Always pick stocks where you feel you have a research edge.
3/ You rarely go wrong investing in the company with the best product.
4/ Don’t listen to management. They are paid to be bullish.
5/ Study competitors, suppliers, and customer behavior. Be a product junkie.
6/ Have in your mind what you think a stock is worth, which is different from price.
7/ Be able to articulate in one sentence why you own a stock.
8/ Develop specific downside scenarios that would cause you to sell the stock.
9/ The highest quality of growth is unit growth, then pricing, then margin expansion, then cash reinvestment.
10/ Be wary of companies that grow by buying other companies.
11/ Sell discipline is selling a stock once it exceeds your price target, or if your investment thesis changes.
12/ Short stocks that have bad businesses, and not because they trade at high P/Es.
13/ Two big value creators are brand extension and TAM expansion stories.
14/ High P/Es are a function of high future growth rates, and not the industry.
15/ When investing in growth stocks always look for a controversy (“fight”).
16/ Buy stocks that can leverage key secular megatrends, and avoid those that will be hurt by them.
17/ Always consider cannibalization of existing products when sizing up new product opportunities.
18/ Be wary of “hockey stick” sales forecasts absent new products or expansion to new distribution channels.
19/ Stock buybacks are accretive if the E/P ratio exceeds the after tax cost of debt or return on cash.
20/ Price cuts rarely add value since they often create a race to the bottom.
21/ Stocks are cheap if price is less than the present value of future cash flows. A high P/E does not make a stock expensive.

[Gary Black @garyblack00]

I’m just explaining to you why the market reacted negatively to TSLA’s monster delivery heat. $TSLA has had a 200x+ P/E for years. TSLA had run up +15% vs NDX +2% in the prior week. It’s clear the market anticipated TSLA’s beat and sold the news. Why is that so difficult to accept?

[Gary Black @garyblack00]

$TSLA (-7% today) blew away 2Q delivery ests. But investors anticipated the beat.

[Gary Black @garyblack00]

@shkhnnotstirred I wasn’t telling anyone to buy. We are neutral on $TSLA the stock.

[Gary Black @garyblack00]

$TSLA (+0.7% pre-mkt) delivered 480K vehicles in 2Q, +25% YoY and far exceeding WS estimates of 406K. Excluding Models S and Y, which are being discontinued, TSLA 2Q delivs were 467K, and still +24% YoY. Days of inventory outstanding dropped from 29 DSO in 1Q to 17 DSO in 2Q. https://t.co/SgjBeh6PHB

[Gary Black @garyblack00]

@squawksquare Too many traders bought the rumor of a massive beat and then sold the news.

[Gary Black @garyblack00]

@squawksquare I don’t believe it’s Elon selling. Even with a 10b5-1 plan I doubt the lawyers would allow him to sell in the blackout window which generally starts two weeks before the quarter closes and ends the day after earnings 7/22. $TSLA

[Gary Black @garyblack00]

@shkhnnotstirred $TSLA -7% today.

[Gary Black @garyblack00]

You don’t seem to get how the asset management business works. Both Ross and I get paid a fee on the AUM we manage for clients. Clients pay us on strong performance and good client service. Not being in $TSLA or being underweight TSLA the past few years has helped our performance since TSLA has performed poorly.

[Gary Black @garyblack00]

Probably the single most important driver of a stock is forward earnings revisions. To go higher, $TSLA needs to change its revisions trajectory from negative to positive. Investors are willing to go 3-5 years out when looking at TSLA revisions to give FSD and Optimus time to be reflected, but even 2027-2030 TSLA revisions are negative.

[Gary Black @garyblack00]

@Th3Seafox @GerberKawasaki @DeanParisian @RealJimChanos I have no position in $TSLA. No one pays me to make bearish comments about TSLA.

[Gary Black @garyblack00]

@Rec1pr0city Higher oil prices.

[Gary Black @garyblack00]

FSD is not driving sales. The avg consumer has no idea about FSD or $TSLA ‘s autonomy efforts.

[TESLARATI @Teslarati]

@BGWarrior420 @garyblack00 That assumes people know about FSD and people trust autonomy.

If you ask a random person, they don’t know much about FSD nor will they be comfortable with it. Unfortunately, people are still widely misinformed about it.

Everyone sees gas prices and nobody wants to pay them.

[Gary Black @garyblack00]

@RandyWKirk1 Evidence?

[Gary Black @garyblack00]

@TheTeslaBull Ask 10 random drivers if $TSLA FSD would cause them to buy a Tesla. Most will not know what you’re talking about. It’s not like the company advertises or has a broad PR effort.

[Gary Black @garyblack00]

I’ve run PR efforts before and that’s not how the process works. Normally, the unforeseen event happens and both sides race to position their version of the story as the truth to the media, which is trained to show a balanced story. When only one team shows up, what do you think is the result?

[Gary Black @garyblack00]

@modern_shelby $TSLA +15% in the past week vs NDX +2%. The 2Q beat was already baked into the stock price. Investors selling the news.

[Gary Black @garyblack00]

@TheTeslaBull @DeItaone @ryan4cybertruck Why?

[Gary Black @garyblack00]

$RIVN delivered 12.2K vehicles in 2Q, beating WS estimates of 10.6K. RIVN also raised 2026 delivery guidance from 62K-67K to 65K-70K. RIVN stock +6% pre-mkt.

[Gary Black @garyblack00]

@ElectricTo11 @thejefflutz If $TSLA doesn’t show up, the media will only print one side of the story. Whose fault is that?

[Gary Black @garyblack00]

No