Is Tesla Inc. (TSLA) Still A Great Investment Choice?

·3 min read

Baron Funds, an asset management firm, published its “Baron Partners Fund” first quarter 2021 investor letter – a copy of which can be downloaded here. A decline of 0.38% was delivered by the fund’s institutional shares for the Q1 of 2021, while the Index declined 0.57% for the same period. You can view the fund’s top 5 holdings to have a peek at their top bets for 2021.

Baron Partners Fund, in its Q1 2021 investor letter, mentioned Tesla, Inc. (NASDAQ: TSLA), and shared their insights on the company. Tesla, Inc. is a Palo Alto, California-based electric car company that currently has a $562.3 billion market capitalization. Since the beginning of the year, TSLA delivered a -17.47% return, while its 12-month gains are up by 262.49%. As of May 12, 2021, the stock closed at $589.89 per share.

Here is what Baron Partners Fund has to say about Tesla, Inc. in its Q1 2021 investor letter:

"Tesla, Inc. designs, manufactures, and sells fully electric vehicles, solar products, energy storage solutions, and battery cells. The stock fell during the quarter as a result of general market dynamics and a potential production slowdown due to parts shortages. A refreshed S/X and China Model Y ramp could also have a negative impact on margins in early 2021. We anticipate strong growth and improved margins driven by new production capacity, manufacturing efficiencies, localization of its manufacturing and supply chain, and maturation of Tesla’s full self-driving technology."

Tesla
Tesla

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Our calculations show that Tesla, Inc. (NASDAQ: TSLA) does not belong in our list of the 30 Most Popular Stocks Among Hedge Funds. As of the end of the fourth quarter of 2020, Tesla, Inc. was in 68 hedge fund portfolios, compared to 67 funds in the third quarter. TSLA delivered a -28.54% return in the past 3 months.

The top 10 stocks among hedge funds returned 231.2% between 2015 and 2020, and outperformed the S&P 500 Index ETFs by more than 126 percentage points. We know it sounds unbelievable. You have been dismissing our articles about top hedge fund stocks mostly because you were fed biased information by other media outlets about hedge funds’ poor performance. You could have doubled the size of your nest egg by investing in the top hedge fund stocks instead of dumb S&P 500 ETFs. Here you can watch our video about the top 5 hedge fund stocks right now. All of these stocks had positive returns in 2020.

At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, Federal Reserve has been creating trillions of dollars electronically to keep the interest rates near zero. We believe this will lead to inflation and boost real estate prices. So, we recommended this real estate stock to our monthly premium newsletter subscribers. We go through lists like the 15 best innovative stocks to buy to pick the next Tesla that will deliver a 10x return. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. You can subscribe to our free daily newsletter on our website:

Disclosure: None. This article is originally published at Insider Monkey.