Shares of Tesla Motors (TSLA 0.88%) have cooled off in recent days, but the push that sent the stock price barreling into the triple digits late last month was more than enough to scare away a lot of skeptics.
There were 18.6 million shares of the fast-growing, electric-car maker sold short by the end of May. This may seem like a big number, but it's actually the smaller number of bearish bets placed on Tesla over the past year.
There were more than 30 million shares shorted back in February, just as Tesla was about to pull off a monstrous rally that's seen the stock nearly triple since then.
This isn't an industry thing. Folks looking to cash in on stock declines in the automotive sector haven't completely unclenched their jaws.
There were nearly 73 million shares of General Motors (GM 1.57%) sold short at the end of May, and that's close to its 52-week high. There were just 55 million shares of GM shorted a year earlier.
Bears have borrowed 67.2 million shares of Ford (F 3.03%) to short as of the end of May. That's a dramatic improvement from the nine-figure short interest that Ford was sporting through most of last year, but shorting interest had climbed every reporting period since bottoming out at 45.2 million by the end of January through mid-May.
GM and Ford aren't chopped liver. They are both thriving in the improving climate for automakers. GM is holding up so well that it was just reintroduced to the S&P 500 after a four-year leave of absence. Ford has come through with five consecutive quarters of better than expected bottom-line results.
However, Tesla -- despite its lofty valuation -- is the automaker that doesn't have a well-defined ceiling. It's a convertible. It can take the roof off with a monster quarter or a timely Twitter post by its charismatic CEO.
It's easy to gauge the growth prospects for GM or Ford. Analysts see both companies growing their revenues in the single digits in 2013 and again in 2014. That's not Tesla. We're seeing explosive growth, and that's before knowing what will happen with next year's Model X or the eventually dramatically cheaper Tesla in three to four years.
Is Tesla too expensive now? Absolutely. Try telling that to burned naysayers that felt that way three months ago before the stock went on to roughly triple in value. Tesla may never be cheap, but it will always be volatile, and that's the kind of action that may excite bears at times when it's not sending them scrambling to cover their positions.
Tesla has a lot to do to earn its $11 billion market cap, but that won't be much of a consolation the next time that Musk decides to take the roof down again so he can enjoy the bright sky.
