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Elon Musk's leadership at stake: Time to sell Tesla?

Published 06/12/2024, 10:15 AM
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Investing.com - There are only a few hours left for Tesla (NASDAQ:TSLA) investors to decide the future salary of their CEO, Elon Musk, by voting for or against his annual remuneration package of $56 billion. Additionally, among the series of proposals to be voted on, is the relocation of the company's headquarters from Delaware to Texas. The results of these consultations will be announced at the annual shareholder meeting this Thursday, June 13.

According to Musk, 90% of retail shareholders have voted in favor of both resolutions. However, he faces resistance from institutional investors, including some of the largest pension funds in the United States, who have even described this compensation as "ridiculous."

The June 13 meeting also puts Musk's leadership at stake: if investors approve the payment, they would also reaffirm his control over Tesla, as the magnate would come to hold more than 22% of the company's shares, up from the current 12.9%. A rejection could even impact the stock price.

But if you are a Tesla investor or interested in becoming one and looking for the highest returns, you need to pay close attention to this: the most advanced Artificial Intelligence suggests it might be time to say goodbye to this stock... for now. This, if you want to design a portfolio where you see explosive gains every month, even higher than those delivered by the S&P 500 index with the largest companies on Wall Street.

If you are already a subscriber to InvestingPro, you knew before anyone else that in the June adjustment of the “Beat the S&P 500” ProPicks strategy, our Artificial Intelligence (AI) has selected Tesla as one of the 12 stocks to sell. And it's not surprising: during the month of May, Tesla shares accumulated a loss of 2.84%, and so far in June, the decline is already at 4.21%.

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ProPicks strategies are AI-driven selections with the values that have the greatest potential to outperform the market benchmarks. Specifically, the “Beat the S&P 500” ProPicks comprises the 20 most profitable stocks that have everything to surpass this index.

Since the launch of ProPicks in October last year until the end of May, this strategy has delivered a return of 28.21%, doubling the 14.86% observed by the S&P 500 in the same period.

Through an analysis known as “backtesting,” it is possible to observe that in the period between January 1, 2013, and June 1, 2024, this set of values has delivered an explosive return of 1,052.6%, surpassing the S&P 500's return of 270% by 782.6%.

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To achieve the maximum potential of gains with this ProPicks strategy, it is necessary to know exactly which stocks the AI selects each month to sell, buy, and hold. If you are not an InvestingPro subscriber, you can become one here.

Within the "Beat the S&P 500" strategy, there are great stars with immense potential, including Nvidia (NASDAQ:NVDA) (NASDAQ), which executed its stock split on Friday at a ratio of 10 to 1, so investors now have the opportunity to buy the shares at around $120.

In fact, InvestingPro subscribers have known about Nvidia's great potential since November when ProPicks selected it as part of "Beat the S&P 500." During that period, its price went from around $420 to over $1,220 before the split.

But remember that one of the basic rules for reducing the risk of losses in investments is diversification of portfolios or, as the popular saying goes: "don't put all your eggs in one basket."

With this in mind, the ProPicks strategies will allow you to invest in the most powerful stocks, obtain returns far above the market average, and at the same time, have a diversified portfolio that will reduce risks in the event of a collapse.

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