12 Reddit Stocks with High Potential

9. Tesla Inc. (NASDAQ:TSLA)

Number of Hedge Fund Holders: 126

Average Upside Potential as of April 15: 36.71%

Tesla Inc. (NASDAQ:TSLA) deals in electric vehicles and energy generation and storage systems through its two segments. The Automotive segment offers EVs and related products and services. The Energy Generation and Storage segment offers solar energy generation and energy storage products and services.

The company’s autonomous driving and AI-related initiatives are anticipated to eventually make up 90% of its valuation. Optimus alone can generate more than $10 trillion in revenue for Tesla. On April 14, Deutsche Bank reiterated a Buy rating on the company because it expects Tesla to do well in the long run because of these advancements and the ability to utilize AI in its products. However, the bank does acknowledge the short-term volatility that the business faces right now.

Still, Tesla Inc. (NASDAQ:TSLA) is somewhat insulated from the current tariff environments when compared to other major automakers in the US. This is because Tesla has a higher degree of vertical integration and makes the majority of its parts itself, something that traditional automakers lack. However, Tesla heavily relies on international sources, mainly China, for a significant amount of its parts and batteries.

JDP Capital Management initiated the stock in June 2024 and stated the following regarding Tesla Inc. (NASDAQ:TSLA) in its Q4 2024 investor letter:

“Tesla, Inc. (NASDAQ:TSLA) is new core position that I wrote about in 2024 Half Year Letter. The stock was up 115% in 2024. We benefited from the June 2024 timing of our purchase, buying after the stock had declined about 30% in the first part of the year.

We repurchased TSLA at a time when the market had [again] become overly bearish based on slowing vehicle orders despite the company having just achieved a breakthrough in Full Self Driving (FSD v12). If you haven’t had a chance to experience the most recent Full Self Driving software (FSD 13.3) I suggest you try it for yourself. If you’ve had a Tesla for a while, you know that the trajectory of FSD improvement has been nothing less than astounding.

It has become clearer to me that Tesla’s leadership position in the infrastructure layer underpinning mega-trends in robotics, smart vehicles and battery storage will unlock earnings growth that we can ride for years. Similar to AWS or the iPhone, Full-Self-Driving and Optimus will enable new business models to be built across a wide range of industries over time…” (Click here to read the full text)