5 Best Falling Stocks To Buy Now

1. Tesla, Inc. (NASDAQ:TSLA)

6-month Decline as of March 14: 39.67%

Number of Hedge Fund Holders: 91

Tesla, Inc. (NASDAQ:TSLA) is the best falling stock to buy now according to analysts and hedge funds. The stock has lost 39.67% over the past 6 months, as of March 14, but Wall Street remains optimistic. On March 9, Morgan Stanley reiterated its Overweight rating and a $220 price target on Tesla, Inc. (NASDAQ:TSLA).

At the end of Q4 2022, 91 hedge funds held stakes in Tesla, Inc. (NASDAQ:TSLA). The total value of these stakes amounted to $5.93 billion. As of December 31, Citadel Investment Group is the top stockholder in Tesla, Inc. (NASDAQ:TSLA) and has a position worth $926.2 million.

Here is what ClearBridge Investments had to say about Tesla, Inc. (NASDAQ:TSLA) in its Q4 2022 investor letter:

“Tesla, Inc. (NASDAQ:TSLA), meanwhile, also fits squarely within our earnings reset group. We took advantage of its enterprise multiple falling back to historic lows to initiate a starter position in the leading manufacturer of electric vehicles (EV) and developer of battery technologies. Tesla has a significant structural cost advantage in battery production, EV manufacturing and EV selling, which gives it industry-leading operating margins in EVs. As the auto cycle has softened, the stock has sold off substantially with the rest of the automakers, despite EVs continuing to have a secular growth advantage. Tesla has a clean balance sheet with negative net debt and enormous revenue growth, EBITDA growth and free cash flow generation. Its margin buffer also gives the company the ability to cut prices while still protecting earnings better than competitors, which should help support continued volume growth. There is also significant upside optionality driven by its software offerings, which we do not believe is currently priced into the stock.

That being said, Tesla is highly indexed to a flagging auto market and we expect its earnings outlook to worsen in the near term. We are also monitoring increasing EV competition and the recently emerging risks to the brand and management integrity raised by CEO Elon Musk’s actions at Twitter to determine future position size in the portfolio.”

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