Here’s How Macquarie Large Cap Growth Fund Benefited from Not Owning Tesla (TSLA)

Macquarie Asset Management, an investment management company, released its “Macquarie Large Cap Growth Fund” first quarter 2025 investor letter. A copy of the letter can be downloaded here. In the first quarter, Macquarie Large Cap Growth Fund Institutional Class shares posted negative absolute returns; however, they surpassed the performance of the Fund’s benchmark, the Russell 1000® Growth Index. Despite market challenges, the firm’s investment style performed well, focusing on higher-quality businesses. For more information on the fund’s best picks in 2025, please check its top five holdings.

In its first-quarter 2025 investor letter, Macquarie Large Cap Growth Fund highlighted stocks such as Tesla, Inc. (NASDAQ:TSLA). Tesla, Inc. (NASDAQ:TSLA) designs, develops, manufactures, leases, and sells electric vehicles, as well as energy generation and storage systems. The one-month return of Tesla, Inc. (NASDAQ:TSLA) was -6.18%, and its shares gained 81.73% of their value over the last 52 weeks. On June 24, 2025, Tesla, Inc. (NASDAQ:TSLA) stock closed at $340.47 per share, with a market capitalization of $1.097 trillion.

Macquarie Large Cap Growth Fund stated the following regarding Tesla, Inc. (NASDAQ:TSLA) in its Q1 2025 investor letter:

“At the individual stock level, the greatest contribution was attributable to not owning Tesla, Inc. (NASDAQ:TSLA), and our positions in Intercontinental Exchange Inc. (ICE) and Visa Inc. Tesla faced well-publicized headwinds last quarter that may bleed into future periods. This has remained a constant stock of debate among the investment community and is volatile as a result. The business has never met our quality standards and we are happy to sit on the sidelines of this battleground stock.”

Tesla (TSLA) Soars 8.23% on Successful Robotaxi Launch

Tesla, Inc. (NASDAQ:TSLA) is in 23rd position on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 104 hedge fund portfolios held Tesla, Inc. (NASDAQ:TSLA) at the end of the first quarter, which was 126 in the previous quarter. While we acknowledge the potential of Tesla, Inc. (NASDAQ:TSLA) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the undervalued AI stock set for massive gains.

In another article, we covered Tesla, Inc. (NASDAQ:TSLA) and shared the list of trending AI stocks on Wall Street. In addition, please check out our hedge fund investor letters Q1 2025 page for more investor letters from hedge funds and other leading investors. While we acknowledge the potential of TSLA as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you’re looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

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