Rhumbline Advisers Cuts Tesla Stake as Institutional Investors Shift Holdings

Rhumbline Advisers has reduced its holdings in Tesla, Inc. (NASDAQ:TSLA) by 0.9% during the second quarter of 2023, reflecting a strategic shift among institutional investors. According to Holdings Channel, the investment firm now possesses 5,179,984 shares of the electric vehicle manufacturer after selling 44,532 shares in the period. This reduction places Tesla as approximately 1.4% of Rhumbline Advisers’ total portfolio, making it the eighth largest position.

At the end of the most recent reporting period, Rhumbline Advisers’ stake in Tesla was valued at around $1.65 billion, showcasing the significant financial commitment that remains despite the decrease. Other institutional investors have also adjusted their Tesla holdings recently, indicating a broader trend in the investment community.

Institutional Investor Movements

Mufg Securities Americas Inc. has notably increased its stake in Tesla by 25.4%, now holding 62,105 shares valued at approximately $19.73 million after acquiring an additional 12,571 shares. Similarly, Evelyn Partners Investment Management Services Ltd. has amplified its investment by 229.1%, bringing its total to 2,557 shares worth $774,000 post a purchase of 1,780 shares.

Evelyn Partners Investment Management LLP also raised its position in Tesla by 177.6%, now owning 14,773 shares valued at $4.69 million. Journey Strategic Wealth LLC increased its stake by 99.2%, now holding 22,374 shares worth $7.11 million, while Mediolanum International Funds Ltd. raised its position by 30.0%, owning 257,391 shares valued at $83.30 million.

Overall, institutional investors and hedge funds collectively own approximately 66.20% of Tesla’s stock, reflecting a strong interest in the company’s performance.

Recent Insider Activity

In addition to institutional trading, insider activity at Tesla has also been notable. On September 11, 2023, Senior Vice President Xiaotong Zhu sold 20,000 shares at an average price of $363.75, totaling $7.28 million. Following this transaction, Zhu retains 47,600 shares, valued at around $17.31 million, which represents a 29.59% decrease in their position.

Chief Financial Officer Vaibhav Taneja also sold shares, offloading 2,606 shares on September 8, 2023, at an average price of $352.38, resulting in a transaction worth $918,302.28. Taneja now holds 9,856 shares valued at approximately $3.47 million, which marks a 20.91% reduction in their stake. Over the past quarter, insiders have sold a total of 202,606 shares valued at $75.59 million, with corporate insiders currently holding 19.90% of the company’s stock.

Tesla’s Financial Performance and Analyst Ratings

Tesla reported its quarterly earnings on October 23, 2023, revealing earnings per share of $0.50, exceeding analysts’ expectations of $0.48. The company’s revenue for the quarter reached $28.10 billion, surpassing the consensus estimate of $24.98 billion. This performance resulted in a return on equity of 6.61% and a net margin of 5.51%. Notably, quarterly revenue was up 11.6% year-over-year compared to the same quarter last year, where earnings were reported at $0.72 per share. Analysts predict that Tesla will achieve earnings per share of $2.56 for the current fiscal year.

Recent analyst reports reveal a mixed yet optimistic outlook for Tesla. CICC Research raised its price target on Tesla shares from $360.00 to $450.00, assigning an “outperform” rating. New Street Research increased their target from $465.00 to $520.00, issuing a “buy” recommendation. Evercore ISI set a target of $300.00 with a “neutral” rating, while Bank of America raised its target from $341.00 to $471.00 with a “neutral” rating as well.

In total, one analyst has rated Tesla with a “Strong Buy” designation, twenty-one have given it a “Buy” rating, twelve have assigned a “Hold” rating, and ten have suggested a “Sell” rating. Current consensus data indicates an average rating of “Hold” with a price target of $394.31.

Company Overview

Tesla, Inc. designs, develops, manufactures, leases, and sells electric vehicles, alongside energy generation and storage systems globally, including markets in the United States and China. The company operates in two primary segments: Automotive and Energy Generation and Storage. Its Automotive segment encompasses electric vehicles and automotive regulatory credits, as well as after-sales services, used vehicles, body shop and parts, supercharging services, retail merchandise, and vehicle insurance.

The recent adjustments in holdings, combined with Tesla’s financial performance and evolving analyst sentiment, highlight the dynamic nature of investment in the electric vehicle market. Investors are keenly observing developments as the company continues to navigate the challenges and opportunities within this rapidly evolving sector.