19 May

JAT Capital Adds to Its Position in Tesla Motors in 1Q15

WRITTEN BY Patricia Garner

JAT Capital and Tesla Motors

JAT Capital Management raised its stake in Tesla Motors (TSLA) in the first quarter of 2015. The hedge fund’s position in TSLA, worth $138 million, accounted for 3.73% of its total 1Q15 portfolio.

According to aggregated 13F data, about 56 hedge funds created new positions in TSLA in the first quarter of 2015. As well, there were about 17 hedge funds with TSLA in their top ten holdings. And, a total of 176 hedge funds added to positions in TSLA in this quarter.

JAT Capital Adds to Its Position in Tesla Motors in 1Q15

In terms of dollar value invested, JAT Capital ranks 13th among funds holding shares of TWC in 1Q15. T. Rowe Price, Jennison Associates, Vanguard Group, BlackRock, and BAMCO were other top TSLA holders.

Main competitors

Tesla’s primary competitors in the large luxury vehicles market include Daimler (DAI), which owns the Mercedes-Benz brand, Toyota Motor (TM), which owns the Lexus brand, BMW Group (BMW) and Volkswagen (VOW), which owns the Audi and Porsche brands.

Capacity expansion plans

To position itself for the proposed launch of Model X in the later half of 2015, Tesla has initiated several expansion projects. The company began enlarging its Fremont facility to include a paint shop that will accommodate Model S and Model X vehicles. The shop will provide high-volume, high-quality paint services while keeping costs low.

Tesla also announced that it’s installing state-of-the-art machinery at the Lathrop manufacturing facility. This machinery will provide the necessary components for manufacturing electric vehicles.

Plus, Tesla has partnered with Panasonic to set up the Tesla Gigafactory, a large-scale battery manufacturing facility near Reno. The project is proceeding according to plan, and the companies expect battery-pack production will begin in 2016.

Tesla posted mixed results in 1Q15

TSLA posted 1Q EPS (earnings per share) of -$0.36, beating estimates by $0.14. However, the company missed revenue estimates by $100.1 million. The company reported 1Q revenue of $939.9 million, an increase of 51.5%. During the quarter, TSLA manufactured 11,160 vehicles, 10% more than its own guidance.

As you can see in the chart above, Tesla Motors has outperformed other benchmarks, yielding a return of 11.88% so far in 2015. Apparently, JAT Capital’s bet on TSLA is wisely placed.

TSLA makes up 0.51% of the PowerShares QQQ Trust, Series 1 (QQQ). The company also accounts for 0.89% of the iShares U.S. Consumer Goods ETF (IYK).

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