Israel Englander’s Stock Portfolio: Top 10 Stocks to Invest in

7. Tesla, Inc. (NASDAQ:TSLA)

Number of Hedge Fund Holders as of Q4: 126

Millennium Management’s Equity Stake: $794.26 Million 

Tesla, Inc. (NASDAQ:TSLA), headquartered in Austin, Texas, generates revenue through multiple streams, primarily from its automotive and energy businesses. The majority of its earnings come from vehicle sales, which include the design, manufacturing, and sale of electric models such as the Model 3, Model S, Model X, and Model Y, along with leasing, used vehicle sales, retail merchandise, insurance, energy generation, vehicle servicing, non-warranty after-sales services, and public charging. Another key source of income for Tesla, Inc. (NASDAQ:TSLA) is from the sale of carbon and automotive regulatory credits, further diversifying its financial portfolio.

Tesla’s Q4 2024 earnings report showed mixed results, with net sales rising 2.15% year-over-year to $25.71 billion, and operating profit falling 23.3% to $1.58 billion. Earnings per share of $0.73 missed analyst expectations by 4.8%. Despite a stock rally fueled by speculation of policy benefits under President Trump’s administration, Tesla, Inc. (NASDAQ:TSLA) faced significant challenges, including its first annual decline in vehicle deliveries, totaling 1.8 million units. In response, the company introduced aggressive discounts, particularly in North America and China, to stimulate demand. Musk remains focused on autonomy and robotics, but Tesla continues to trail competitors like Waymo and Chinese firms WeRide and Pony.ai in the robotaxi space. While Musk has announced plans to launch “unsupervised” Full Self-Driving (FSD) in Austin by June and hinted at licensing deals, Tesla’s brand value dropped by $15 billion in 2024, partly due to Musk’s controversial political statements. However, the company’s energy division provided a bright spot, generating $3.06 billion in revenue, a 113% increase from the previous year.

Investor concerns about Tesla, Inc. (NASDAQ:TSLA)’s future are mounting, with shareholder Ross Gerber warning of a potential 50% stock decline in 2025. He attributes this to multiple factors, including the company’s lagging FSD technology, Musk’s divided attention across multiple ventures, slowing vehicle sales, rising competition from China’s BYD, and potential reputational damage linked to Musk’s political affiliations. Gerber further argues that the company’s $1.1 trillion market capitalization is unsustainable given its lower profitability compared to rivals. His concerns are echoed by JPMorgan, which maintains a bearish outlook with a price target of $135, suggesting a potential 60% decline in Tesla, Inc. (NASDAQ:TSLA)’s stock value.