Tesla Investor T. Rowe Sells Most of Its Shares in Car Maker
By Akane Otani
T. Rowe Price Associates Inc. sold roughly 81% of its shares of
Tesla Inc. over the first three months of the year, marking a sharp
retreat for a firm that for years had been one of the electric-car
maker's biggest investors.
The fund manager held 1.7 million Tesla shares as of March 31,
down from 8.9 million shares at the end of 2018, according to a
Wednesday filing with the Securities and Exchange Commission.
T. Rowe declined to comment on the move, while Tesla didn't
immediately respond to a request for comment.
The move by T. Rowe comes as Tesla shares have logged a 30% loss
for the year through Wednesday, compared with the S&P 500's 14%
Analysts have attributed the decline to worries about the
company's fundraising, as well as delivery problems and tension
between Chief Executive Elon Musk and federal regulators over his
tweets. Evercore ISI analysts cut their target price on Tesla on
Wednesday to $200 from $240.
Mr. Musk has tried to reassure investors about Tesla's
prospects, saying at an April presentation that he would be able to
deliver an on-demand robot taxi fleet by 2020.
Despite Mr. Musk's promises, many investors have remained
skittish. Tesla shares edged down 0.2% to $231.95 on Wednesday,
compared with the S&P 500's 0.6% advance.
While T. Rowe has stepped back from Tesla, it has continued to
pump money into companies that analysts have touted as potential
competitors in the race to develop autonomous vehicles.
The firm made an equity investment in Cruise, the driverless-car
unit of General Motors Co., which was recently valued at $19
billion. It has also invested in the autonomous-vehicle startup
Aurora Innovation Inc., whose chief executive helped to launch what
is now Alphabet Inc.'s self-driving program, Waymo.
T. Rowe's move leaves the firm holding the smallest number of
Tesla shares since 2013, according to a FactSet analysis of 13F
filings. The company had ramped up its holdings in the second half
of 2018, even as Tesla shares slid over Mr. Musk's "funding
Because T. Rowe runs both actively managed and passive funds,
some of the decline in holdings may have been spurred by money
flowing out of funds, as opposed to reduced positions.
Write to Akane Otani at firstname.lastname@example.org
(END) Dow Jones Newswires
May 15, 2019 20:09 ET (00:09 GMT)
Copyright (c) 2019 Dow Jones & Company, Inc.