Just a week after talks of him starting his own social media platform, Tesla CEO Elon Musk purchased a 9.2 percent stake in Twitter. The stock by resulted in a price surge for both Twitter and Tesla stocks, but questions are swirling about how much of an active stake this will be for the controversial figure who's had a fraught relationship with the platform over the years. Dan Ives, the managing director of equity research at Wedbush, joined Cheddar News to discuss. "I think this is a start of what's gonna really be a soap opera with Musk, either getting on the board or forcing significant strategic changes at Twitter," he noted.

Closing Bell

Dan Ives on How Active Elon Musk Might Be as Twitter Shareholder

Elon musk once again making headlines. The Tesla Ceo, who has a complicated history with twitter purchasing a 9.2% stake in that company Musk bought 73.4 million shares for nearly $3 billion Twitter stock soaring up 28% today and tesla stock up as well. Well, joining me now is dan Ives, managing director of equity research at Wedbush dan. It's good to see you this, coming a week after musk of course floated the idea of creating his own social media app. Is it a sign that he'll try to now influence twitter? Yeah, look, I think the reality is is that him doing social media from the ground up was almost impossible and you look at twitter, it was the perfect storm for him to really go after at this point. I think it's passive is really the start, but ultimately we believe this will be an active steak and ultimately forced change to twitter, but it's no secret. I mean musk is, is a big proponent on social media in terms of what he does not like about twitter platform investors don't like in terms of from an advertising of modernization and I think this is a start of what's gonna really be a soap opera with musk, either getting on the board or forcing significant strategic changes at twitter. So some people have said there's too much free speech on twitter that would be one side of the argument, musk clearly uses twitter, it's an effective mouthpiece and marketing tool, not only for himself, but for his company Tesla as well, what kind of change would, must want to see a twitter? Well first off, I mean from an investor perspective, I mean they're, they're basically hoping for any change because right now this has been a treadmill situation at twitter where they feel like must could force some sort of strategic changes, my organization is going to be one and that's obviously something that the experts would have to get in there and get under the hood, but I think from a twitter platform, a lot of it just subscriber growth has been winning and modernization and eyeballs and that all goes hand in hand with the social media platform that needs to be viewed positively in this social media arm trees and right now twitter is coming on the wrong side of that, which is why this was the time, if musk was going to go after twitter, this is sort of the perfect timing, especially with Dorsey taken a backseat, interesting as so how big of a steak dan would, must have to acquire and twitter to make real change. Yes, so what I ultimately focus on sort of the steps by behind the scenes right now to just at least initiate discussions with the board with management depending on how that goes, I would expect an active stake above, you know, and then he'll start to continue to build that, I mean right now, biggest shareholder in twitter and this is something where, you know, they could force changes across the board, whether it's on the board, whether it's strategically and then ultimately, which is why the stocks up, I mean, could they eventually force an acquisition or some sort of buyout? That's what the street is obviously hoping for with what you saw today. So here's a question. One last question on this. Before we pivot to Tesla for a user of twitter, should they expect if, must does continue to gather shares and create a more active stake in this company? Should users expect eventually down the road, a dramatically different experience? I think that's the question, right for users like, okay, it must be involved in the platform, how that's going to change. And I think ultimately that's really the question. Um, you know, does it ultimately have less filtering, you know, has it compared to other social media, you know, platforms, but, but right now we must, we all know, I mean, SpaceX and Tesla motors to focus areas and now it's really what the next steps are going forward, Do they team up with private equity or other and that's really gonna be, you know, front and center. But, but it goes back to like there, the active steak, I think it's viewed as a foregone conclusion now, it's a matter of really how twitter reacts to obviously this move by musk, Okay, so we'll wait to see twitter's own reaction dan, but I do want to pivot to Tesla stock as well. Elon musk the ceo of this company, Strong delivery numbers in the first quarter, 310,000 vehicles delivered the semiconductor chip shortage, seemingly not impacting this company despite greatly impacting other automakers out there like Ford and General Motors, what does this mean for the company? How does it set itself up for the rest of the year? You know, you can take a step back and we still think 25-30,000 units got pushed out because the supply chain, other logistical issues and of course you got the COVID shutdowns in China but look they're flexing their muscles from the factory production and overall supply chain. Now this is the time that obviously they're building up Berlin which is up and running. You got Austin later this week, the official unveiling and I think it just shows they continued the supply is going to be a constraint across the board but a little more Teflon like for Tesla and that's why you know, investors at first over the weekend, they could be like, okay, they're not great numbers but it goes back to like a B or a B plus is viewed as an A plus and this type of market relative to what you're seeing with ford GM and other, especially even in china and Neo. So maybe it's not the semiconductor shortage that would have impacted Tesla last quarter. But now we're in the second quarter and the shanghai gigafactory, this all important gigafactory production place for Tesla remains closed as covid cases rise In the Shanghai area and mass testing of the 26 million residents does continue. How much longer can this factory stay closed before it starts to have a material impact on Tesla's bottom line. Yeah, if it goes beyond seven days it starts to move the needle. I think right now it's contained. They still have enough inventory. This starts to go 7 to 10 days. Then you start to have another shutdown during the quarter. I mean this it's a core hearts and lungs of castle in terms of production. So I'd say right now it's contained, investors are shaking it off. If it lasts longer, then it starts to become an issue. We're gonna leave it there, dan Ives, managing director of equity research at Wedbush Securities. We appreciate dance time.