5 Stocks to Buy Before Interest Rate Hikes

4. Tesla, Inc. (NASDAQ:TSLA)

Number of Hedge Fund Holders: 60

Tesla, Inc. (NASDAQ:TSLA) is an American electric vehicle manufacturer, specializing in electric cars, storage batteries, clean energy, and solar panels. Billionaire Elon Musk’s Tesla, Inc. (NASDAQ:TSLA) also offers services including vehicle servicing, charging, insurance, software updates and upgrades, and premium connectivity. 

Tesla, Inc. (NASDAQ:TSLA) published its Q4 financial results on January 26, posting earnings per share of $2.54, exceeding estimates by $0.16. Revenue jumped approximately 65% from the prior-year quarter, reaching $17.72 billion, surpassing estimates by $1.08 billion. 

Jefferies analyst Philippe Houchois on January 27 observed that Tesla, Inc. (NASDAQ:TSLA)’s Q4 not “only met a fast rising consensus” but also noted that its free cash flow “beat handsomely” and argues that the company’s operating metrics “remain exceptional and a threat to legacy OEMs.” There will however be a lack of new products in 2022, the analyst told investors in a research note. He sees sufficient growth in the Model 3 and Y in 2022 to support estimates and Tesla, Inc. (NASDAQ:TSLA) reaching 2% global share. He maintains a Buy rating on Tesla, Inc. (NASDAQ:TSLA) shares with a $1,400 price target.

Cathie Wood’s ARK Investment Management is one of the largest Tesla, Inc. (NASDAQ:TSLA) stakeholders as of Q3 2021, holding approximately 4 million shares, amounting to over $3 billion. Overall, 60 hedge funds were bullish on Tesla, Inc. (NASDAQ:TSLA) in the third quarter, with stakes totaling $10.6 billion. 

Here is what Alger Spectra Fund has to say about Tesla, Inc. (NASDAQ:TSLA) in its Q4 2021 investor letter:

“Tesla is an electric vehicle (EV) manufacturer with a significant technology lead in its large and rapidly growing addressable market. Tesla is a consequential transportation company because it is setting the pace for industry innovation over the foreseeable future. It has potential to maintain its lead as it ramps up auto production and battery capacity. We are optimistic about EV innovation, adoption and Tesla’s growth prospects. The shares contributed to portfolio performance as Tesla successfully increased production of new model S and X units driving a richer revenue mix as the prices of these vehicles are higher and the cost to produce lower than earlier versions. Earnings estimates climbed for Tesla as pricing for vehicles in the backlog has increased. Further, as Tesla’s newer, more efficient factories increase production, unit costs may potentially decline relative.”