Fidelity is the latest institutional investor to trim its Tesla stake

  • Fidelity has followed T. Rowe Price in trimming exposure to Tesla shares, new documents show.
  • Three of Fidelity’s mutual funds sold 1.4 million shares of the electric car company in the first quarter, Bloomberg reports.
  • Tesla announced plans to raise up to $US2 billion in debt and equity on Thursday.

Another of Tesla’s largest holders trimmed its stake in the first quarter.

Three of Fidelity’s mutual funds sold about 1.4 million total shares in Elon Musk’s electric car company, Bloomberg reported Wednesday, citing documents posted on the company’s website.

Fidelity’s Blue Chip Growth Fund divested 406,000 shares, while the firm’s Contrafund fund sold 172,006 shares and its OTC Portfolio Fund sold 393,800.

The divestitures by Tesla’s second-largest institutional holder (behind Scottish investment firm Baillie Gifford) follow a similar move by T. Rowe Price (the third largest institutional holder) in the first quarter.

Tesla’s stock price has fallen by more than 20% since January 1, as disappointing delivery and earnings prints weigh on investors minds, while forcing some Wall Street analysts to lower their price targets and downgrade the stock.

On Thursday, Tesla announced new equity and debt financing rounds that could raise the company as much as $US2 billion. Musk himself has pledged to buy more equity as part of the fundraising, the company said.

The state of Tesla’s investors will be made more clear in the coming weeks as large investors including hedge funds file a holdings form known as 13-F, required within 45 days of the end of a financial quarter.

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