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You're here (TSLA – Free Report) could become a member of the S & P 500 index in the second quarter of next year if it manages to show sustained profitability over 12 months, according to a Macquarie analyst.
By Macquarie, Tesla meets all the requirements of the S & P 500, with the exception of four quarterly GAAP results. The analyst believes that the electricity maker will reach this milestone in the second quarter of next year. This is likely due to continued demand for S and X models, increased production and revenue potential from the zero emission vehicle credit.
Tesla released its third quarterly profit last month and reaffirmed its earnings guidance and positive free cash flow for the fourth quarter. The company posted a surprise profit of $ 2.90 per share in the third quarter of 2018, compared with a loss of 55 cents from the Zacks consensus estimate. This compares to a loss of $ 2.92 per share a year ago and represents the third quarterly profit in 15 years of existence (read: Tesla surprises with big profits for the third quarter: buy).
Revenues of $ 6.82 billion surpassed the consensus estimate of $ 5.77 billion set by Zacks and rose 128% from one year to the next. The third quarter was a truly historic quarter for Tesla, with model 3 being the top-selling car in the United States in terms of revenue and the fifth-best-selling car in terms of volume.
The inclusion of Tesla in the S & P 500 will be good news for its shareholders as well as for the title. Companies added to the S & P 500 for the first time saw their price rise by an average of 6.9% on the day of the announcement compared to the average increase of 0.2% of the S & P 500. From Moreover, its inclusion would attract new investors into the company, which would buy the company indirectly through financial products invested in the S & P 500.
With this in mind, investors could use the right time with the help of the following ETFs, which have a significant share of the luxury car manufacturer's capital. Tesla ranks first in the Zacks (strong buy) and has a growth index of B. Moreover, it belongs to a well ranked industry (among the top 4%), suggesting good news for the title ( see all ETFs on alternative energies here.)
ARK Industrial Innovation ETF (ARKQ – Free report)
It is an actively managed ETF that seeks long-term capital appreciation by investing in companies that benefit from the development of new products or services, technological advances, and advances in scientific research in emerging markets. areas of robotics, energy storage, innovative materials, alternative sources of energy and infrastructure development. , space exploration, autonomous vehicles and 3D printing. This approach results in a basket of 38 stocks, with TSLA in first place at 11.3%. The product has accumulated $ 178.9 million of assets and bills 75 basis points of fees per year. He sees a lower volume of about 38,000 shares a day.
ARK Innovation ETF (Arkk – Free report)
Like the ARKQ, it is also an actively managed fund that follows the same strategy, while also offering exposure to genomics companies, corporations, and businesses. industrial innovation or Web companies x.0. In total, the fund holds 38 stocks in its basket, with Tesla in first place at 10.5%. The product has accumulated $ 1.3 billion of assets and is trading a good volume of about 349,000 shares. The expense ratio is 0.75%.
ARK Web x.0 ETF (ARKW – Free report)
It is an actively managed fund that targets companies that should benefit from the transition from technology infrastructure to the cloud, enabling mobile, new and local services. The fund holds 40 stocks in its basket, with Tesla in first place at 9.5%. The ETF has raised $ 547.2 million in assets and trades a good average daily volume of about 175,000 shares. The expense ratio is 0.75% (read: The two presidential years of Trump: FNB areas not to be missed).
VanEck Vectors Global Alternative Energy ETF (GEX – Free report)
This ETF tracks the Ardor Global Index Extra Liquid Index, focusing on global companies that are primarily engaged in alternative energy activities. The fund holds approximately 30 stocks in its basket and $ 86.2 million in assets under management while charging fees of 63 basis points per year. The average daily volume is derisory at around 4,000 shares. Tesla ranks third in the basket, with an allocation of 9.2%. In terms of country exposure, the fund is oriented towards the United States with a market share of 60.5%, while Denmark and China complete the top three positions.
NASDAQ First Trust Clean Edge Green Energy Index Fund (QCLN – Free report)
This fund tracks the Nasdaq Clean Edge Green Energy Index and manages $ 90.9 million in assets. It charges 60 basis points a year and trades around 13,000 shares a day. In total, the product contains 40 US stocks, with Tesla Motors taking first place at 9.8%.
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