Tesla (NASDAQ:TSLA) stock has dropped out of the top 10 holdings of the South Korean EV-focused mutual fund, Bloomberg reported. TSLA stock declined over 65% in 2022, underperforming the NASDAQ 100 (NDX) index.
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According to the report, the recent volatility in Tesla stock and increased competition led the investment management company to reduce its holdings in TSLA stock to below 2% of the net asset value from over 9%. The fund’s lead manager, Hwang Woo-Taek, also listed Tesla’s high valuation and Elon Musk’s sale of TSLA stock to fund the Twitter acquisition as reasons for the reduction in holdings.
Tesla stock is trading at a forward P/E (Price/Earnings) multiple of 32.63, much higher than the sector median of 14.28. Further, Tesla’s growth could moderate due to increased competition from traditional automakers.
While the fund cut its holdings in TSLA stock, Bloomberg reported earlier that South Korean retail investors had amassed Tesla shares worth $2.8 billion.
What Do Analysts Say About Tesla Stock?
Though Tesla faces challenges, Wall Street remains bullish about its prospects. TSLA stock has a Moderate Buy consensus rating on TipRanks based on 20 Buys, nine Holds, and three Sells. TSLA’s price target of $230.99 implies 78.82% upside potential.
