The Inflation Reduction Act 2022: Top 5 Winners

2. Tesla, Inc. (NASDAQ:TSLA)

Number of Hedge Fund Holders: 80

Tesla, Inc. (NASDAQ:TSLA) is a Texas-based automotive company that designs and manufactures electric vehicles, energy generation solutions, and battery systems. Although Tesla, Inc. (NASDAQ:TSLA) has manufacturing facilities in China, the company has several plants in the United States, which makes it eligible for tax credits. However, Tesla, Inc. (NASDAQ:TSLA) will need to introduce more affordable EV variants such as the Model 3, given that EV companies will only be eligible for the Act’s provisions if their vehicles are priced under $55,000. Tesla, Inc. (NASDAQ:TSLA), which posted market-beating Q2 2022 results, will undoubtedly be one of the main beneficiaries of the Inflation Reduction Act 2022. 

On August 8, Canaccord analyst George Gianarikas raised the price target on Tesla, Inc. (NASDAQ:TSLA) to $881 from $815 and maintained a ‘Buy’ rating on the shares. The analyst noted that although macroeconomic factors and the latest price hikes could materially affect order rates, he forecasts that Tesla, Inc. (NASDAQ:TSLA)’s EV momentum and competitive edge from manufacturing, materials procurement, and autonomy is safe for a while. He added that with further offerings in solar and energy storage, Tesla, Inc. (NASDAQ:TSLA) continues to be an American sustainability giant.

According to Insider Monkey’s data, 80 hedge funds were bullish on Tesla, Inc. (NASDAQ:TSLA) at the end of Q1 2022, compared to 91 funds in the prior quarter. Cathie Wood’s ARK Investment Management is a prominent stakeholder of the company, with roughly 1.6 million shares worth $1.7 billion. 

Here is what Grantham Mayo Van Otterloo & Co. LLC had 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, Inc. (NASDAQ:TSLA). At its Battery Day last year, Tesla, Inc. (NASDAQ:TSLA) 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.”