TSLA bearish play thesis focused on buying 2 contracts of the $190 PUT (May 2, 2025) at $3.31 each. This version scales up all profit/loss values and ROI calculations to reflect a 2-contract position (i.e., 200 shares total).
🧠 TSLA Bearish Earnings Thesis – 2 Contract Play
Earnings Date: April 28, 2025
Option Expiration: May 2, 2025
Strategy: Buy 2x TSLA $190 PUTs @ $3.31
Total Cost (Premium Paid): $662 ($3.31 × 100 × 2)
Breakeven: $186.69
Thesis: Multiple Converging Catalysts Suggest Sharp Downside Risk
Tesla is facing a perfect storm of fundamental, technical, and sentiment-driven challenges. These create a highly asymmetric opportunity for short-dated PUT buyers heading into earnings.
⚠️ 1. Earnings Risk – Underperformance Expected
Delivery Misses: Q1 delivery numbers fell short of analyst expectations. Slower ramp in key markets like China and Europe due to economic slowdowns.
Margin Compression: Aggressive price cuts to maintain volume are eating into margins. Expectations for gross margin contraction YoY are high.
Disrupted Guidance: Potential downside revision to full-year forecasts as competition heats up (BYD, Ford, Rivian, etc.).
❝ Street is pricing in perfection. Any earnings or margin disappointment could send shares sharply lower. ❞
🧨 2. Brand Boycotts & Political Fallout
Public Backlash: Tesla faces intensifying boycott pressure in parts of Europe and the U.S. due to Elon Musk's political affiliations and controversial stances.
Brand Dilution: Musk’s polarizing presence has damaged Tesla's once-premium EV image. High-income, eco-conscious buyers are switching brands.
Retail Sentiment Shift: Reddit, X (formerly Twitter), and retail forums show sharp decline in "diamond hand" loyalty.
❝ Tesla’s brand equity is eroding. Negative sentiment is now a structural overhang. ❞
🔺 3. Headline Volatility – The “Musk Premium” Now a Liability
SEC & DOJ Scrutiny: Multiple ongoing investigations. Any bad headline can crash the stock.
X (Twitter) Overhang: Distraction and capital risk tied to Musk’s ownership of X are ongoing market concerns.
AI Pivot Uncertainty: Musk’s recent AI pushes have created confusion about Tesla’s core vision, with no clear monetization path.
❝ Musk headlines, once a tailwind, are now a systemic volatility trigger. ❞
📊 Modeled P&L for 2 Contracts
TSLA Price on May 2 % Drop Option Value per Contract Total Value (x2) Net Profit ROI (%)
$220 -16.5% $30.00 $6,000 $5,338 806%
$210 -20.3% $40.00 $8,000 $7,338 1,108%
$200 -24.1% $50.00 $10,000 $9,338 1,410%
$190 -27.9% $60.00 $12,000 $11,338 1,712%
$186.69 (Breakeven) -29.2% $63.31 $12,662 $12,000 1,812%
$263.55 (No drop) 0% $0.00 $0 - $662 -100%
💡 Strategy Recap – 2 Contract Position
Metric Value
Strike $190 PUT
Contracts 2
Premium $3.31 × 100 × 2 = $662
Breakeven $186.69
Max Risk $662
Max Reward $12,662
Reward/Risk Ratio ~19:1
✅ Final Thesis (2 Contracts)
"With $662 risked, a move to $200–$210 can yield ~$8,000. A move to $190 or below offers potential returns of over $11,000, making this a powerful short-term asymmetric play post-earnings. While risky, it’s tightly capped with a clearly defined thesis."
🧠 TSLA Bearish Earnings Thesis – 2 Contract Play
Earnings Date: April 28, 2025
Option Expiration: May 2, 2025
Strategy: Buy 2x TSLA $190 PUTs @ $3.31
Total Cost (Premium Paid): $662 ($3.31 × 100 × 2)
Breakeven: $186.69
Thesis: Multiple Converging Catalysts Suggest Sharp Downside Risk
Tesla is facing a perfect storm of fundamental, technical, and sentiment-driven challenges. These create a highly asymmetric opportunity for short-dated PUT buyers heading into earnings.
⚠️ 1. Earnings Risk – Underperformance Expected
Delivery Misses: Q1 delivery numbers fell short of analyst expectations. Slower ramp in key markets like China and Europe due to economic slowdowns.
Margin Compression: Aggressive price cuts to maintain volume are eating into margins. Expectations for gross margin contraction YoY are high.
Disrupted Guidance: Potential downside revision to full-year forecasts as competition heats up (BYD, Ford, Rivian, etc.).
❝ Street is pricing in perfection. Any earnings or margin disappointment could send shares sharply lower. ❞
🧨 2. Brand Boycotts & Political Fallout
Public Backlash: Tesla faces intensifying boycott pressure in parts of Europe and the U.S. due to Elon Musk's political affiliations and controversial stances.
Brand Dilution: Musk’s polarizing presence has damaged Tesla's once-premium EV image. High-income, eco-conscious buyers are switching brands.
Retail Sentiment Shift: Reddit, X (formerly Twitter), and retail forums show sharp decline in "diamond hand" loyalty.
❝ Tesla’s brand equity is eroding. Negative sentiment is now a structural overhang. ❞
🔺 3. Headline Volatility – The “Musk Premium” Now a Liability
SEC & DOJ Scrutiny: Multiple ongoing investigations. Any bad headline can crash the stock.
X (Twitter) Overhang: Distraction and capital risk tied to Musk’s ownership of X are ongoing market concerns.
AI Pivot Uncertainty: Musk’s recent AI pushes have created confusion about Tesla’s core vision, with no clear monetization path.
❝ Musk headlines, once a tailwind, are now a systemic volatility trigger. ❞
📊 Modeled P&L for 2 Contracts
TSLA Price on May 2 % Drop Option Value per Contract Total Value (x2) Net Profit ROI (%)
$220 -16.5% $30.00 $6,000 $5,338 806%
$210 -20.3% $40.00 $8,000 $7,338 1,108%
$200 -24.1% $50.00 $10,000 $9,338 1,410%
$190 -27.9% $60.00 $12,000 $11,338 1,712%
$186.69 (Breakeven) -29.2% $63.31 $12,662 $12,000 1,812%
$263.55 (No drop) 0% $0.00 $0 - $662 -100%
💡 Strategy Recap – 2 Contract Position
Metric Value
Strike $190 PUT
Contracts 2
Premium $3.31 × 100 × 2 = $662
Breakeven $186.69
Max Risk $662
Max Reward $12,662
Reward/Risk Ratio ~19:1
✅ Final Thesis (2 Contracts)
"With $662 risked, a move to $200–$210 can yield ~$8,000. A move to $190 or below offers potential returns of over $11,000, making this a powerful short-term asymmetric play post-earnings. While risky, it’s tightly capped with a clearly defined thesis."
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Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.