Altimeter Capital Makes a Big Bet on Tesla (TSLA) Stock

Altimeter Capital, managed by founder Brad Gerstner, functions as a highly focused hedge fund with over $6 billion in 13F assets under management (AUM). The top holding, Snowflake (NYSE:SNOW), constitutes 41.05% of its 13F portfolio. Altimeter operates as a long-term fund with an average 13F holding period of 9.36 quarters, or 2.34 years.

During the fourth quarter, Altimeter acquired only one new stock: Tesla (NASDAQ:TSLA). It purchased 156,670 shares of TSLA, positioning the electric vehicle (EV) pioneer as its ninth-largest holding out of 11 total.

This marks the fund’s second investment in Tesla. Initially, it acquired 173,000 shares of TSLA stock in Q3 2022 before fully divesting the following quarter.

“While we expect their share will stay at around 15% as we move forward, that’s 15% in a massively growing market and we think they are going to be a much larger percentage of the profit pool in electric vehicles, in energy storage, etc.,” Gerstner said in 2022. He also anticipated a 30% to 40% growth in the EV market over the next five to 10 years.

Gerstner previously held bearish views on TSLA in 2019 and 2020, fueled by concerns of undercapitalization and potential bankruptcy. His stance flipped following government backing of EVs and Tesla’s robust margins compared to rivals.

However, Altimeter’s TSLA stock stake reflects the status as of Dec. 31. Since then, TSLA stock has dipped approximately 19%.

According to Morgan Stanley analyst Adam Jonas, institutional investors are projecting underperformance for TSLA stock over the next six to 12 months. Jonas arrived at this deduction after hosting the Tesla “bull/bear” lunch event at Morgan Stanley.

“We expected bearishness from institutional investors given recent negative sentiment on the name,” said Jonas and his team. “But there was barely any attempt to argue for a near-term bull case.”

Jonas himself has set a price target of $345 and an “overweight” rating on the company. The analyst believes that Tesla is not simply a tech company, but also an energy, robotics, and artificial intelligence (AI) company.

On the date of publication, Eddie Pan did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.