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Tesla will jump another 400% after a stormy rally this year, says billionaire Ron Baron



ron baron
  • Billionaire investor Ron Baron told CNBC on Wednesday that Tesla would become a $ 2 trillion company.
  • Baron’s asset management company bought Tesla in 2016, when the shares were about $ 40.
  • He said he was focused on Tesla’s business and less concerned about short-term stock movements.
  • The electric vehicle company has grown by more than 442% so far.

Legendary investor Ron Baron told CNBC on Wednesday that Tesla would jump another 400% to reach a $ 2 trillion estimate.

The founder of Baron Capital is a longtime Tesla bull and said he bought it in 201

6, when shares traded for only $ 40. Shares climbed, but are now trading at about $ 450 per share, which is more than 442 % until. Baron said he was more focused on Tesla’s business model than on short-term stock yo-yo movements.

“What we are worried about is not stock prices when we are investors in business, but we are worried about business,” he said. “In the short term, I can’t imagine what will happen. I think – now it exceeds $ 400 billion in market capitalization, it was $ 40 billion when we started.”

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The Baron continued, “I have said for a long time that I think it will be 1 to 2 trillion. With the development that has happened recently, I think 2 trillion is the right number.”

Baron said he expects the electric vehicle company to build more factories and have between $ 500 million and $ 800 million in car sales in 10 years alone. “Batteries are just another amazing business that I’m very excited about,” he added.

“So far, in the first four or five years since we’ve owned it, stocks have gone up and down like a yo-yo, and that’s to be expected,” Baron said. “Because what they were doing, they were building facilities, hiring people, coming up with designs. It’s reasonable to bet against them.”

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But Baron Capital is betting big on Tesla. The company, with more than $ 39 billion in assets under management, has a number of equity-backed growth funds. Tesla is the largest holding company in the Baron Partners fund, accounting for about 29% of total investments.

The fund was the leader among total domestic equity funds in the third quarter, according to The New York Times. The second best performing fund is the Baron Focused Growth Fund. Tesla is also the highest contributor to this fund.

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