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tesla company. (NASDAQ:TSLA) holds the distinction of being the least-held among institutional investors among the ‘Magnificent Seven’, as highlighted by its fund manager. Gary Black In a recent post. Black also delved into factors that could give institutional investors confidence in the company.
what happened: Institutional investors own 54% of Tesla’s free float, excluding shares held by management, according to Bloomberg data.
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in contrast, Meta Platforms Co., Ltd. (NASDAQ:META) has the highest institutional ownership, followed by Alphabet Co., Ltd. (NASDAQ:GOOGL) (NASDAQ:GOOG), Microsoft Corporation (NASDAQ:MSFT), Amazon Co., Ltd. (NASDAQ:AMZN), Nvidia Inc. (NASDAQ:NVDA), and Apple. (NASDAQ:AAPL).
Related item: Everything you need to know about Tesla stock
Black people’s perspective: According to Black, Tesla’s limited institutional ownership is due to factors such as key man risk, headline risk, high P/E valuation risk, capital reinvestment risk, and relative underperformance relative to the stock price. This could be due to several risks faced. For the past 3 years.
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Black expanded on capital reinvestment risks and highlighted concerns about how Tesla allocates cash, citing events at the company that include: Bitcoin Considering acquisitions and integration of Elon Musk’s other businesses in 2021 — space x, of Boring Co., Ltd. and Neuralink — It is owned by Tesla Inc. and could potentially raise equity despite having $26 billion in cash.
Black noted that Tesla is expected to accumulate $100 billion in cash by 2028. Regarding Bitcoin holdings, he stressed that the impact would be minimal as Tesla’s cryptocurrency holdings are currently valued at $184 million (5 cents per share).
Why it’s important: While institutional interest in Tesla appears subdued, data shows retail interest in the stock is increasing.
Tesla is on track to record the largest dollar inflow from retail investors in 2023, boosting this. SPDR S&P 500 ETF (NYSE:SPY), a CNBC report citing Vanda Research said in late December.
Despite posting more than 100% growth in 2023, Tesla experienced a 5.07% decline in the second half of the year, and is down another 12% year to date in January, compared to the lackluster growth observed since mid-2023. This prevents re-acceleration from a situation where there is no
Tesla closed Friday’s trading down 3.67% at $218.89, according to data from Benzinga Pro.
Read more from Benzinga on the future of mobility. follow this link.
Read next: Tesla earnings looming: Analysts highlight 3 key numbers amid stock slump
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2024 Breaking News: SEC approves Bitcoin ETF!
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