Longtime Tesla (TSLA) – Get Tesla Inc Report bull Chamath Palihapitiya said he shed his shares of the electric vehicle maker to fund his other investment ideas.
The Social Capital chief executive unloaded his shares of the Palo Alto, Calif., company “in the last year or so” to take advantage of its elevated price, Palihapitiya said at an investment conference, according to CNBC.
“I don’t have an infinite pool of capital. So when I have these ideas, the money has to come from somewhere,” he said.
When Tesla stood around $800 in January, Palihapitiya told CNBC the stock could double or triple, calling it a “distributed energy business.”
Tesla recently traded at $783.31, up 0.3%. It has climbed 11% year to date and 86% over the past year.
Palihapitiya said he still liked Tesla but “completely underestimated” the EV market’s potential size.
“When you see it now, the market has flipped. … Tesla will be very busy just being a best-in-class EV company,” he said.
Morningstar analyst Seth Goldstein puts fair value at $600 for Tesla.
“We award Tesla with a narrow moat rating,” he wrote in a commentary last month.
“Tesla’s moat stems from … intangible assets and cost advantage. The company’s strong brand cachet as a luxury-auto maker commands premium pricing in the luxury-auto market, while Tesla’s electric vehicle manufacturing expertise allows the company to make its vehicles cheaper than its competitors.
“Tesla’s brand cachet is not likely to be impaired any time soon as other automakers move into the battery electric vehicle space because we expect Tesla to keep innovating to stay ahead of startup and established competitors.”
