Musk meme stocks will now make up almost 7% of the SP500
u/TheSleepyTruth ·
Reddit — r/ValueInvesting
· May 21, 2026 at 17:03
· ⬆ 40 pts
· 💬 31 comments
| View on Reddit ↗
AI Summary
Summary
Post argues that Tesla (TSLA) and SpaceX (private) will soon make up ~7% of the S&P 500, labeling them “Musk meme stocks” with PE ratios of 400 and negative/negligible earnings.
Author’s thesis is that these stocks are ticking time bombs and index investors are overexposed; advises building a custom portfolio or finding ETFs that exclude them.
Quality assessment: Speculative opinion piece, not well-researched DD. Lacks hard data or valuation analysis; pure bearish sentiment on TSLA.
TSLA trades at ~400x PE with weak/negative earnings, yet will become a ~7% S&P 500 weight, amplifying risk for passive holders. Author’s strong bearish conviction implies a potential mean-reversion or valuation collapse as index rebalancing forces forced buying, creating a short opportunity. Short TSLA based on extreme valuation and author’s characterization as a “ticking time bomb” meme stock with poor fundamentals. Momentum could persist if sentiment remains bullish; SpaceX hype or Musk news could inflate TSLA further; short squeeze risk. No other actionable tradeable tickers explicitly stated (SpaceX is private, no ETF ticker given).
This Reddit post, published May 21, 2026,
features u/TheSleepyTruth
discussing TSLA.
1 trade idea extracted by AI with direction and confidence scoring.