Well-known Tesla Inc (NASDAQ:TSLA) commentator Gary Black shared his latest take on the potential merger of the electric vehicle company and space/AI company SpaceX (NASDAQ:SPCX) in a social media post Monday. Here’s what the investor had to say.

Gary Black on Tesla/SpaceX Merger

Tesla Inc and SpaceX CEO Elon Musk didn’t have much to say about a potential merger between the two companies while commenting on Tesla’s quarterly financial results. The CEO did mention synergies between the two companies as investors continue to speculate that a merger could happen in the future.

Black isn’t so sure.

"I am amazed how many investors are holding $TSLA because they believe $SPCX will buy it," Black tweeted. "IMO, that won’t happen anytime soon since the potential dilution to SPCX shareholders is too significant if SPCX paid a 20% premium for TSLA only to have the combined entity trade at TSLA’s lower multiple."

Black said investors should own Tesla if they believe in unsupervised autonomous FSD, meaning more Tesla vehicles sold or unsupervised autonomy scaling quicker than the market is pricing in.

"Owning TSLA for a buyout by SPCX is buying the greater fool theory."

Read Also: SpaceX May Have Surpassed Tesla as Wall Street’s Worst Capital Misallocation Ever, Expert Says

Tesla, SpaceX Stock Prices Fall

Attention on a potential merger between Tesla and SpaceX comes with both stocks trading down in recent months.

Tesla stock trades at $308.07 on Monday, nearing a 52-week low of $297.82. The stock trades at an 11-month low and has been beaten down since last week’s quarterly financial results. Year-to-date, Tesla stock is down 29.7%.

SpaceX stock went public at a price of $135 and opened for trading at $150. While the stock traded higher initially and hit a high of $225.64, the space stock has fallen back to earth.

SpaceX shares are down 32% over the last month, including an 8.5% decline over the last five trading days.

While some investors own both Tesla and SpaceX stock, investors who own shares of one may be more in favor of a merger or, likewise, could be against a merger, believing that shares are undervalued at current beaten-down levels.

With Musk leading both companies and the two working together on several items, calls for a merger will continue for years to come.

Read Also: SpaceX Stock Selloff: ‘Don’t Even Think About Bottom-Fishing,’ Expert Says

Photo: mundissima / Shutterstock – ek