Analysts are Bearish on These 5 Consumer Stocks as Recession Begins

1. Tesla, Inc. (NASDAQ:TSLA)

Number of Hedge Fund Holders: 80

Elon Musk’s Tesla, Inc. (NASDAQ:TSLA) is down about 45% year to date as of July 5. The EV giant is losing market share to competitors. On July 5, JPMorgan analyst Ryan Brinkman lowered the price target on Tesla, Inc. (NASDAQ:TSLA) to $385 from $395 and assigned an Underweight rating to the shares. The analyst slashed Q2 and 2022 earnings estimates after Tesla, Inc. (NASDAQ:TSLA) announced quarterly delivery of 254,695 units, “materially less” than the 310,000 manufactured in Q1 and the 315,000 units the analyst predicted in April. Declining production in Shanghai due to external factors is possibly the leading contributor to the lower deliveries during the quarter, although there may be “company-specific execution issues” at its new factories in Austin and Berlin, the analyst told investors. He reduced his 2022 EPS estimate to $10.80 from $11.50.

In the first quarter of 2022, 80 hedge funds were long Tesla, Inc. (NASDAQ:TSLA), down from 91 funds in the previous quarter. Cathie Wood’s ARK Investment Management is a notable shareholder of the company, with roughly 1.6 million shares worth $1.7 billion. 

Here is what GMO LLC has to say about Tesla, Inc. (NASDAQ:TSLA) in its Q1 2022 investor letter:

“To put the demand growth for clean energy materials into perspective, let’s look at Tesla (NASDAQ:TSLA). At its Battery Day last year, Tesla projected three terawatt hours of lithium-ion battery capacity needed in 2030 for the EVs and storage they expect to produce. To reach this target, Tesla alone would gobble up approximately 75% of the world’s current nickel production and four times the world’s current lithium production. These numbers are astounding enough, but when one considers that EVs currently represent just 15% of global nickel demand and about 45% of lithium demand and that Tesla will likely be producing only a small proportion of the world’s EVs in 2030, the implications are staggering. Clean energy materials companies will make a lot more money in the decades to come than they ever have both because they will be selling a lot more metric tons of material and because there are certain to be shortages where supply can’t keep up with the rapidly growing demand.”

You can also take a look at 10 Best Electric Utility Stocks To Invest In and Jim Cramer Recommends These 10 Stocks For Recession. 

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