Wedbush Managing Director Dan Ives joins Yahoo Finance Live to discuss Elon Musk's 9.2% stake in Twitter and whether the Tesla CEO will take a more active role in the social media platform.

Video Transcript

JULIE HYMAN: Got to get back to our top story now though, and that is the Twitter reaction as we learn that Elon Musk was taking a 9.2% stake in the company. Again, it is a passive stake. So what exactly does that mean? Dan Ives is with us, Wedbush managing director and senior equity analyst. Dan, it's good to see you. I mean, what does it mean? Like when Elon Musk reports a passive stake does that mean he's not going to chime in at all? I mean, to expect Elon Musk to be quiet on a company that he's taken this size of a stake in, that seems a little unrealistic doesn't it? DAN IVES: Look, this is just the appetizer. I mean, ultimately, we believe that he will have an active stake probably over the coming weeks or months. And this is just the start of I think a broader strategic focus of Twitter. Whether it's changing the slate, changing the management team, or ultimately a buyout. So just to be clear, I mean, this is just the start of what I believe is going to be a much more active role for Musk at Twitter. BRIAN SOZZI: Dan, hold on. Elon Musk is not buying Twitter. Do you think he could actually make a play for Twitter here? This guy is trying to change the world with SpaceX, and electric vehicles via Tesla. Do you think that-- what is the probability on something like that? DAN IVES: Yeah, it's not about Musk himself buying Twitter, it's about him ultimately starting to become much more active. Then once they go above the 10% stake in terms of strategically whether it's getting on the board, and then ultimately, if Twitter does not listen behind the scenes, then this could be something where ultimately, from a private equity or other could be a catalyst to a potential acquisition. I think that's the way the Street's viewing it. That's why the stock's up the way it is. I think there is no one out there that believes he's just going to end with a 9.2% passive stake. BRIAN SOZZI: And Dan, you-- you're a longtime bull on Tesla. As an analyst that has covered this company for some time, do you want to see Elon Musk out there trying to make changes at Twitter when he's launching gigafactories around the world and making millions of electric cars? DAN IVES: Yeah, look, I think investors have gotten used to Musk obviously casts a massive net, right? And there was a view for many with SpaceX that that was going to take away, take the eye off the ball on Tesla, and obviously has done the opposite. I think investors are fine with it. I think to some extent it just further expands the potential ecosystem of Tesla. Musk has talked about it. I mean, is he going to build a social media from the ground up? That's extremely difficult but if you look at Twitter, you're talking about an apathetic sort of shareholder base, you're talking about a company that's really been on a treadmill, a lot of headwinds. If there was a time for him to get more aggressive, this was the time. JULIE HYMAN: Dan, OK, so if he is going to increase the stake even more if this is just the appetizer if he's going to push for strategic changes, what are those strategic changes? I mean, basically, when he's weighed in on Twitter operations on Twitter, on Twitter, of course, it's him kvetching about that Twitter doesn't let people say what he thinks they should be able to say on Twitter. Is that really the strategic change that Twitter needs? DAN IVES: Look, I think it's really about monetization. It's about the eyeballs as a platform, right? That's been an issue in terms of just when you look at share gains versus other social media, it's really share losses. So of course, the initial view is obviously, Musk's gripe about Twitter. But in terms of from a shareholder perspective would really be about monetization, the advertising. And look, social media it's massive changes going on right now and it feels like Twitter is in the right lane going 45 miles an hour while everyone's passing them at 80 going left lane. JULIE HYMAN: Yeah, I guess what I'm asking is, is Musk the person who is going to make those necessary changes, right? I mean, I get that his public-facing Twitter persona is different than Musk the CEO of Tesla, we've seen that, right? That he sort of makes a lot of noise over here on Twitter but then effectively runs the company but is that something that we can envision happening for Twitter also? DAN IVES: Well, I think that will be the question. I think it's a question for investors. But also look, you're talking about Musk that revolutionized the auto industry with electric vehicles. Obviously, SpaceX speaks for itself in terms of really the core of the US space program. So when it comes to social media, it's not like that's far-flung, that he at least could try to disrupt it. But Julie, to your point, it's not that he's necessarily going to control, Twitter, it's more that this is the start of him becoming more active in Twitter that could ultimately force changes, whether it's on management, getting on the board or others. That really I think the eyes of many investors is the company that their best days are in the rearview mirror. And I think that's why you're starting to see the excitement, at least from a stock perspective. BRIAN SOZZI: Dan, lost a little bit in the news flow this morning, as you can imagine, Hertz, is linking up with Polestar to order 65,000 EVs. I look across the globe, I see Tesla rival XPeng now expanding into Europe, going into Norway. Is Tesla's dominance in EVs starting to be at risk? DAN IVES: No. I mean, look, Brian, this is just really the start of just this massive green tidal wave playing out. And you know, and even though obviously, supply chain's been an issue, when you talk about with deliveries, ultimately, I mean, we're going to see double-digits of percent of automotive being EVs. You look at Polestar, you're going to look at Ford and GM, you look at Lucid and others. And it's a rising tide is lifting a lot of boats here. It's not just Tesla. But in the EV landscape at this point, it's still Tesla's world, everyone else is paying rent. JULIE HYMAN: And we'll see now if with Musk's involvement it'll be Twitter's world too if we see them getting back into the fast lane to use your analogy. Dan, it's good to see you. Thanks so much, Dan Ives, of Wedbush. DAN IVES: Thank you. JULIE HYMAN: Giving us some perspective on Twitter and on Tesla this morning. We got a twofer with Dan.