Baron Funds, an investment management company, released its “Baron Opportunity Fund” third quarter 2022 investor letter. A copy of the same can be downloaded here. In the third quarter, the fund declined 2.38% (Institutional Shares) compared to a 3.37% decline for the Russell 3000 Growth Index and a 4.88% decline for the S&P 500 Index. The fund fell sharply for the year-to-date and trailing 12-month periods; however, the philosophy of the fund is to achieve strong long-term performance. In addition, please check the fund’s top five holdings to know its best picks in 2022.
Baron Funds discussed stocks like Tesla, Inc. (NASDAQ:TSLA) in the Q3 2022 investor letter. Headquartered in Austin, Texas, Tesla, Inc. (NASDAQ:TSLA) is an electric vehicle manufacturing company. On October 31, 2022, Tesla, Inc. (NASDAQ:TSLA) stock closed at $227.54 per share. One-month return of Tesla, Inc. (NASDAQ:TSLA) was -6.13% and its shares lost 43.52% of their value over the last 52 weeks. Tesla, Inc. (NASDAQ:TSLA) has a market capitalization of $718.514 billion.
Here is what Baron Funds specifically said about Tesla, Inc. (NASDAQ:TSLA) in its Q3 2022 investor letter:
“Tesla, Inc. (NASDAQ:TSLA) makes fully electric vehicles (EVs), related software offerings, solar and energy storage products, and battery cells. After a tough second quarter that included a prolonged shutdown of one of Tesla’s key manufacturing facilities in Shanghai, the company demonstrated a significant 40% sequential increase in production volumes resulting in another quarterly record of production and deliveries. Despite the second quarter complexities, inflationary pressures, and production ramp-up of two new facilities (Berlin and Austin), the company exceeded Wall Street expectations in the second quarter. It maintained healthy 26% normalized gross margins, achieved industry-leading 18% adjusted operating income margins, and has generated over $14 billion of cash from operations over the past year. Moreover, due to Tesla’s high level of vertical integration and U.S. manufacturing capacity, the company is expected to be one of the key beneficiaries of the Inflation Reduction Act, qualifying for significant manufacturing and consumer-related incentives. We believe these incentives can add up to tens of billions of dollars over the coming decade, while also enhancing Tesla’s competitive advantage versus other automakers. The company also held its second artificial intelligence day, which presented continued advancements in its vehicle self-driving program and showcased its rapidly evolving humanoid robot developments (check out the Optimus videos on YouTube). We continue to believe Tesla is well positioned to benefit from complementary tectonic shifts in the automotive industry, including electrification, autonomous driving, and shared mobility. And, yes, Tesla is still effectively debt free, with over $18 billion of cash on its balance sheet, and investors are even speculating about a stock buyback, a far cry from worries of bankruptcy just a few years ago.”
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Tesla, Inc. (NASDAQ:TSLA) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 72 hedge fund portfolios held Tesla, Inc. (NASDAQ:TSLA) at the end of the second quarter which was 80 in the previous quarter.
We discussed Tesla, Inc. (NASDAQ:TSLA) in another article and shared the list of biggest global tech companies by market cap. In addition, please check out our hedge fund investor letters Q3 2022 page for more investor letters from hedge funds and other leading investors.
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Disclosure: None. This article is originally published at Insider Monkey.
