Summary
- Warren Buffett reduced his stake in Chinese electric vehicle giant BYD from 5.06% to 4.94%
- Tesla’s shares declined by 12% following its latest earnings report, leading to Elon Musk losing over $16 billion in personal wealth
- Global EV sales totaled nearly 14 million in 2023, accounting for nearly one in five cars sold
- Wall Street finds Tesla, Ford, and ChargePoint Holdings attractive investment opportunities within the EV industry
- Despite EV market fluctuations, experts see significant growth potential in major players like Tesla and Ford, with analysts predicting price targets and potential upsides for investors.
Article
Warren Buffett’s company, Berkshire Hathaway, recently sold a portion of its stake in Chinese electric vehicle giant BYD, reducing its ownership from 5.06% to 4.94%. Despite Buffett’s reputation for long-term investments, the company has been gradually selling off its shares in BYD since late 2022. This move has been highly profitable, as Berkshire’s initial $232 million investment in 2008 had grown to approximately $5.9 billion by the end of 2020. The recent sale allowed Berkshire to drop below the 5% threshold required for disclosure of further sales.
While Buffett was cutting his stake in BYD, Tesla, the U.S. EV giant, saw its shares drop by 12% following a decline in automotive revenue in Q2. This decrease in Tesla stock also resulted in CEO Elon Musk’s personal wealth decreasing by more than $16 billion. Despite these fluctuations, the global EV industry has experienced significant growth, with nearly 14 million EVs sold in 2023. Many experts still see substantial upside potential in major players in the industry.
In the U.S market, Tesla’s dominance in the EV sector is evident, with 55% of EVs purchased in 2023 being Tesla products. However, Tesla shares have experienced considerable volatility, doubling in value in 2023 but declining by 10% in 2024. Analysts like Dan Ives see a potential revival for Tesla, with a price target of $300 implying a 34% upside. Ford, on the other hand, has made significant strides in electrifying its lineup, with its Mustang Mach-E winning the 2021 North American SUV of the Year Award. Despite rapid growth in EV sales, Ford’s EV venture may take time to become profitable, with a projected full-year loss of $5 billion to $5.5 billion for its EV segment.
ChargePoint Holdings, a company that operates one of the largest EV charging networks in the world, could benefit from the projected increase in EV adoption. With over 306,000 activated ports in North America and Europe, ChargePoint has delivered more than 246 million charging sessions since its inception. While the stock has fallen by 74% over the last 12 months, analyst Chris Pierce has a “Buy” rating on ChargePoint with a price target of $3.00, suggesting a potential upside of 47%. Overall, the EV industry continues to show promise, with major players like Tesla, Ford, and ChargePoint positioned for potential growth in the coming years.
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