To most, it probably doesn’t seem like Tesla Motors Inc (NASDAQ:TSLA) and Apple Inc. (NASDAQ:AAPL) have that much in common. One hedge fund, however, thinks that they do, and it’s always important to track the smart money for its market-beating potential (learn how your peers have generated superb outperformance here).
The stock of Tesla has been doing great recently. It is clearly represented by a 58.9% increase since the beginning of this year. Currently, shares of Tesla Motors Inc (NASDAQ:TSLA) are trading at about $53 a pop; Apple Inc. (NASDAQ:AAPL), meanwhile, is down by more than 17% on the year.
There are several reasons behind Tesla’s appreciation, like the recently-announced “no-fault” battery warranty, which covers almost everything outside of personal assault; Apple hasn’t had quite the same reputation for its warranty policies, but there are more similarities, we promise. Some other good news from Tesla involves a free VIP service for life, under which owners of a Tesla Model S or Roadster can loan a new car when theirs is in service.
So, buying shares of Tesla Motors Inc (NASDAQ:TSLA) seems like a good investment opportunity, despite the bears’ cries for an overvaluation. Quite the opposite situation that Apple Inc. (NASDAQ:AAPL) is in at the moment, proving that value-centric investors aren’t always right in the short- to intermediate-term.
One of the funds that holds shares of Tesla, Longboard Asset Management, recently issued a report which states that Tesla is the most-likely to become a dominant consumer brand, and that the stock will benefit a lot from this. Consequently, the report says that Tesla has a big chance to become a brand like Apple in the fund’s opinion.
Apple Inc. (NASDAQ:AAPL)‘s release of the iPhone in 2007 was a very successful premiere, after which Apple managed to conquer a huge piece of the smartphone market. The same case could be said for Tesla, whose Model S brought the market of electro-vehicles to a new level.
In this way, Longboard Asset Management considers that the share price of Tesla might increase to $100 within 18 months, and in the next five years, the price could increase to $200 a share. Also, Longboard sees Tesla gaining an 80% share of the electric vehicles market, which is currently booming, from a macro-level.
On the next pages you can find the report presented by Longboard Asset Management, “Will Tesla Get Squeezed to $200?” originally posted on slideshare.net.
See the mind-blowing slides here: