Tesla’s vehicle deliveries in Q3 2022 fell short of analysts’ expectations, and it showed on Monday, with TSLA stock closing down 8.6%. Despite the volatility, retail Tesla investors actually increased their purchases of TSLA stock.
According to a report from Vanda Research, net purchases of TSLA stock by retail investors reached about $500 million in the last five trading days alone. This suggested that retail TSLA investors were largely unaffected by the Street’s disappointment at Tesla’s Q3 2022 vehicle delivery figures, and they may even consider the recent volatility as a buying opportunity.
“Retail demand is pivotal for a sustained outperformance of the EV company,” Marco Iachini and Giacomo Pierantoni of Vanda Research wrote in a note. Vanda also noted that Tesla, just like Apple, are among the favorites of retail investors, who are “over-exposed to mega caps,” according to Bloomberg News.
Although Tesla stock has been volatile this year, it has generally performed better than other mega-cap technology stocks. Tesla shares are down 29% this year so far, but the NYSE FANG+ Index has seen a more notable 34% decline.
Retail TSLA investors have been appreciated by Elon Musk over the years. Back in 2020, the CEO noted that a lot of retail TSLA investors understand Tesla better than Wall Street’s analysts. “I do think that a lot of the retail investors actually have deeper and more accurate insights than many of the big institutional investors, and certainly they have better insights than many of the analysts,” Musk said.
In a way, the results of some notable retail TSLA investors speak for themselves. Tesla’s “retail king” Leo KoGuan, for example, is reported to have made a fortune by going all-in on TSLA. Recently, KoGuan, who is also the founder of IT provider SHI International, was named one of the Forbes 400 for 2022.
Disclaimer: I am long TSLA.
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