Elon Musk is one-of-a-kind, like Warren Buffett and Jeff Bezos, says Tesla bull Ron Baron

Elon Musk is one-of-a-kind, like Warren Buffett and Jeff Bezos, says Tesla bull Ron Baron
Elon Musks Tesla roadster reaches its farthest point from the Sun
Since its launch on February 6 atop a Falcon Heavy rocket, Elon Musks cherry-red Tesla Roadster and its “passenger” Starman have been moving away from the Sun.

Billionaire Ron Baron, a major Tesla shareholder, told CNBC on Friday that Elon Musk doesnt need “adult supervision.”

Usually, voluntary submissions are more standard for the SEC, Pitt says. So when the SEC issues a subpoena, it means that the agency feels the need to compel the production of documents and testimony. Tesla isnt the only one receiving the subpoenas, either: former employees have received them, and suppliers and subcontractors may be getting them, too, Pitt says. So we should stay tuned. Any publicly traded suppliers whove been subpoenaed about Tesla may tell us more about the inquiry when they file their own reports.

“Are you kidding me? When all of a sudden you have this success? He could have retired when he was 30, 32 when he made $150 million, he chose to put all that money into SpaceX and into Tesla,” Baron said in a “Squawk Box” interview from his annual investment conference at the Metropolitan Opera House in New York.

Denholm joined the Tesla board in 2014, but she had just taken a job as CFO at Telstra Corp, an Australian communications company, a month ago. (She was previously chief operating officer for the company.) Shes quitting to take the chairwoman gig. A month ago, Denholm said she didnt want to be chairwoman in an interview with Australian media, so this is all very hilarious. Obviously, she is not James Murdoch, whose whisper campaign for the position I enjoyed very much.

“This guy is worth $30 billion, $40 billion,” Baron said two days after Robyn Denholm was named to replace Musk as Tesla chair. Musk was forced to relinquish the chairmanship in the wake of his infamous unfounded tweet that he had backing to take the electric auto maker private. Musk remains CEO.

“You need adult supervision?” Baron continued. “Theres one Elon Musk. Theres one Warren Buffett. Theres one Jeff Bezos. Theres one Sam Walton.”

Tesla critics suggest that Denholm, a director there since 2014, does not count as the “adult supervision” they believe that Musk needs.

Last Friday — the same day that Kara Swishers Musk interview dropped — Tesla filed its regulatory paperwork, and we all discovered that Tesla has been subpoenaed by the SEC about Model 3 production numbers. I am not a lawyer, but subpoenas seem bad, probably?

He also said hes a “fan of women” in business. “[GM CEO] Mary Barra has done an amazing job.” Women “think differently” than men, he added. He also credited women at Baron Capital who have “done an amazing job.”

But the biggest problem followed his August tweet in which he announced a plan to take Tesla private, declaring Funding secured. It turned out Musk had only had the most preliminary discussions with officials from a Saudi Arabian sovereign investment fund. The plan quickly collapsed and the SEC sued Musk, something that could have seen him banned from holding a management position in a public company for life. The settlement required Musk to step down as chairman and pay a $20 million fine — which critics said was barely more than a speeding ticket for someone of his wealth.

Musk has done phenomenally well with Gwynne Shotwell as president and COO of SpaceX, the entrepreneurs privately held commercial space company, Baron said, adding he hopes Denholm will be like Shotwell.

Her experience in financial management should prove critical for Tesla. The companys high-flying stock price cant conceal the weakness of its balance sheet. The electric car manufacturer delivered a surprise, $311.5 million profit — rather than the more than $200 million loss industry analysts had forecast for the third quarter. It was only the third time Tesla was in the black since going public in 2010 and it appears to bode well for Musk, who had promised his company would be profitable and deliver positive cash flow for the second half of 2018.

Tesla on Wednesday announced it elevated Denholm to chairwoman. Stripping Musk of the chairmanship was mandated as part of a September settlement with the Securities and Exchange Commission following his August tweets in which he claimed he had secured funding to take Tesla private at $420 a share.

Yet, that might not be her biggest challenge. Since last spring, the South African-born Musks behavior has become increasingly controversial. He first came under fire when he derided several industry analysts during a first-quarter earnings call. He subsequently got into a flame war with a British diver who helped rescue a group of Thai teens trapped in a flooded cave and now faces a defamation lawsuit. Musk tossed fuel on the fire when he lit up a joint while appearing on comedian Joe Rogans podcast.

During Thursdays trading session, Tesla eclipsed $357 per share, topping the $356.77 price when Musk sent those tweets. Tesla shares were down as much as 26 percent at their near-term closing lows on Oct. 19.

While the electric car maker remains short on cash but long on ambition, the 55-year-old Australian will face some tough and immediate challenges at a company that only recently delivered a rare profit. But perhaps the biggest test for Denholm will be finding a way to rein in the increasingly erratic behavior of Elon Musk, the 47-year-old chief executive officer whose August tweets about taking Tesla private led the Securities and Exchange Commission to force him to relinquish the chairmans post.

Last month, in his first CNBC appearance since Musks erratic behavior over the summer, Baron told “Squawk Box” that he believes Tesla could be a $1 trillion company in revenue by 2030.

Still, there are a number of observers who question whether Tesla can, as Musk insists, fund its aggressive growth strategy without going back to the well for another capital infusion over the next year or so. Not only does the company have to spend millions to boost capacity at its Fremont, California, assembly plant but it also has to pay for the construction of a second plant going up in Shanghai. And then there are all the new products that Musk, who will continue as CEO, has promised:

Baron reiterated that prediction on CNBC Friday, and added “maybe a $2 trillion in valuation” someday.

Though Denholm has been an independent Tesla director since 2014, her appointment came as a surprise to outside observers who had been expecting a more high-profile choice. Barely a month ago, speculation centered around 21st Century Foxs CEO James Murdoch. The media executive had his shortfalls, however, including his ties to the controversial Fox News channel, as well as a lack of experience in the auto industry.

The Baron Capital founder said his average cost of acquiring his Tesla stake between 2014-2016 stands at $219 per share. Baron Funds currently owns 1.7 million shares, worth nearly $600 million at Wednesdays close of $351 per share.

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