American mutual fund manager Ronald Baron believes Tesla Inc (NASDAQ: TSLA) stock has plenty of room to continue rising in the next five years. “Tesla, that’s going to be $2,000 or $3,000 in five years and multiple of that over the next five years,” he said.
According to the billionaire, he is not looking forward to disposing of his share in the Elon Musk-led company Tesla until his investments are multiplied by around 20 times. Instead, he is working to add more of Tesla shares in his portfolio. “I would like to be able to get more money to buy more Tesla, actually,” he said.
Baron said it was okay for investors to short Tesla shares in the past before the company had scaled up its manufacturing capabilities. However, since the company raised a lot of capital to build a gigafactory in the United States, he is very bullish on TSLA in the next few years.
Besides, the China demand for Tesla products has been growing steadily amid the coronavirus market disruption. At the time of reporting, Tesla shares are up 7.85% to trade around $1,014.51. As a result, the shareholders in the leading electric car manufacturer have seen their investment grow 142.49% year-to-date, and over 384% in the past one year.
Tesla (TSLA) Stock May Have Bright Future According to Baron
With a market capitalization of $174.47 billion, the company has room to hit $1 trillion like other huge tech companies in the United States. If it happens, Tesla shares will continue rising as the market is ripe and ready for the next generation of cars.
According to Baron, Tesla has shown to be a good investment and fundamentals are all in favor of an imminent bull rally. He pointed out the company’s strong brand recognition whereby it has $0 in advertising its products. Besides, Tesla is advancing its technology in battery efficiency to reduce its product final market price to compete with other products from other companies globally.
“I told you a long time ago that I thought that we’d make 20 times our money in Tesla. So far we’ve made four times. I now think we’re going to make double or triple again for the next five years. I think there is 10 times more to go in Tesla before I have to think about this if we’re right,” the billionaire said.
In regards to Elon Musk‘s other company SpaceX, Baron said it is an amazing opportunity as well. The billionaire advised young investors to make decisions based on their research, not on others’ calls.