Investor Ron Baron has been one of Tesla’s largest shareholders for years, and he has no plans to change that.
Baron told CNBC on Thursday that he thinks the electric car giant has more room to run high-flying stock – and he plans to hold on to the company’s stock for at least another eight years.
“I think we’re going to make three, four, five times our money at Tesla from here,” Baron told CNBC’s “Squawk Box.” “I think for Tesla this is the beginning of what they are doing.”
Baron Capital, a company by the name of Baron, invested about $ 380 million in Tesla between 2014 and 2016 with an average value of more than $ 50 per share. Following the EV maker’s stratospheric run-up over the past few years, it now has about 12.8% of the total assets under management invested in Tesla, or about $ 6.2 billion.
But the baron is not ready to cash out. Asked if he expects to hold Tesla stock in 8 to 10 years, Baron said yes – although he did mention that his firm sold Tesla stock worth about বিল 1 billion to reduce investor risk and could reduce it. Location again in the future.
“I was widely criticized for having such a large percentage [firm’s] Assets in a stock, and people said how could you be so crazy, “said Baron, explaining the firm’s decision to cut the Tesla partnership.” I wanted them to think I’m not crazy. “
Baron told CNBC that investors should look past the near-term speed bumps, such as the company’s recent miss deliveries. Tesla delivered about 310,000 vehicles in the first quarter, about 7,000 less than the Wall Street consensus estimate.
“People said they should have had 317,000 cars in their quarters,” Baron said. “In four years they’ll make a million cars in a quarter, and if you go 10 years, it’s something like five million cars in a quarter.”
With a quarter of 5 million vehicles, or 20 million per year, Tesla’s automotive business will be roughly the size of Toyota and Volkswagen – currently the world’s two largest carmakers – combined.
Baron Tesla has remained a big fan of CEO Elon Musk and said he was not worried that Mask’s recent decision to invest in Twitter would become a hoax. Kasturi also joined the board of the social media company.
“I just think this [investment in Twitter] Helping his marketing, “Baron said.” There’s no way he’s going to take his eyes off the ball or anything else. “
Tesla shares were effectively flat in premarket trading on Thursday.