Apple Stock vs. Tesla Stock: Billionaires Buy One and Sell the Other – Yahoo Finance
apple(NASDAQ: AAPL) and Tesla(NASDAQ: TSLA) Two of the popular stocks among individual investors, but the hedge fund billionaires listed below sold one and bought another in the fourth quarter.
Millennium Management's Izzy Englanders cut Apple's shares by 9%. He also ranks in the top 10 positions excluding options as he increased his Tesla interest by 195%.
Third Point Dunrove sold all of Apple's stake. He also ranks in his top 20 position as he increased his stake in Tesla by 25%.
David Shaw of De Shaw trimmed 30% of Apple's shares. He also ranks in his top five positions, increasing his 188% shares in Tesla.
According to LCH Investments, Millennium and De Shaw are one of the three most profitable hedge funds in history. It will provide them with a good source of inspiration for individual investors. However, the above transactions occurred in the fourth quarter and ended three months ago.
Read more about Apple and Tesla.
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Apple's investment paper focuses on leadership positions in smartphone sales. The company is immeasurable Pricing power With our hardware and software design expertise, we hope that the average iPhone will sell at least three times the average. Samsung According to CounterPoint Research, smartphones last year.
Apple complements its products with a wide range of services including subscription products such as the App Store, Apple Care, iCloud Storage, Apple Pay, Apple TV+ and Apple Music. Many analysts imagined a new wave artificial intelligence (AI) CHATGPT generates services and large iPhone upgrade cycles after AI spread. However, Apple was unable to offer it.
Last October, the company introduced a suite of AI features called Apple Intelligence for new iPhone models. However, consumers have shown little interest and the upgrade cycle that was expected by so many analysts, has yet to come to fruition. Personally, I'm not surprised. I've never thought about upgrading my iPhone to a supported model. AI features must be incredible for it to be a priority.
The note said Apple Intelligence was supposed to include the functionality of conversation assistant Siri, but these specific upgrades were not particularly noticeable after their initial launch. Apple expects to “reach them next year,” according to a Bloomberg report in March, but says it may need to rebuild AI-infused Siri from scratch.
Apple reported a lack of financial results in the first quarter of 2025, which ended in December. Total revenues rose 4% to $124 billion, service sales increased 14%, and iPhone sales fell 1%. GAAP's revenues still rose 10% per diluted share to $2.40, but stock buybacks were the main reason for its strengths.
Wall Street expects Apple's revenue to rise by 8% over the next four quarters. This makes the current 31x revenue valuation look rather expensive. Certainly, the median target price for Wall Street analysts is $255 per share, meaning a 17% increase from the current stock price of $218. However, I think investors should refrain from buying stocks right now.
Tesla recorded its first decline in annual delivery last year, with price cuts intended to increase profits in demand pain. It led to a loss of market share and a series of disappointing financial results. Revenues rose 2% in the fourth quarter to $25.7 billion, operating margin contracted two points, and non-GAAP net income rose 3% per diluted share to $0.73.
Unfortunately, losses in market share accelerated in 2025, likely due to CEO Elon Musk becoming a political figure. Sales in Europe fell 50% in January and 47% in February. Wall Street Journal. Additionally, Tesla lost a 4% point market share in China during the first two months of the year.
There is some good news. Musk told analysts during his fourth quarter revenue call. “We plan to launch more affordable models in the first half of 2025, and we will continue to expand our lineup from there,” he said. A cheaper, newer vehicle depends on how much politics is a problem for the company.
Perhaps more importantly, Musk says Tesla will launch an autonomous ride (Robotaxis) in Austin in June, and “several other cities in America by the end of the year.” With Adam Jonas Morgan Stanley Last year, “I believe Tesla has many attributes that can make it a scary player (if not a total winner) in the race to autonomy.”
As demand and politics became more pressing issues, consensus revenue estimates among analysts fell sharply. Wall Street expects Tesla's revenue to increase by 22% each year through 2026, down from 29% annually three months ago. In comparison, the current valuation of 108x revenues looks expensive, especially if Tesla missed a consensus estimate in five of the last six quarters.
Certainly, analysts can revise their forecasts upwards if demand improves affordable vehicles once again. The same can happen if Tesla makes Robotaxis a successful market. However, these contingencies can also work against the company if it fails to follow through, which could put the stock at risk.
That's why hedge fund billionaires who bought Tesla stock in the fourth quarter of 2024 wouldn't be surprised if they sold their stock in the first quarter of 2025.
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