American electric vehicle pioneer Tesla has been hailed by the managers of the £ 3.3 billion Monks Investment Trust as an “extraordinary company” with a “maverick leader”.
Tesla, led by Elon Musk, was the largest contributor to Monks’ performance for the year ended April 30th. The trust yesterday reported a total return on net asset value of 55.5 percent for the year ended April. This was well above a total return of 33.9% on the FTSE World Index in sterling terms.
Monks manager Spencer Adair and assistant manager Malcolm MacColl of Edinburgh investment house Baillie Gifford point to a huge increase in Tesla’s manufacturing capacity and the company’s solar and self-driving vehicle technology.
They say in their report on the year: “Tesla is an extraordinary company with a loner. It was the largest contributor to 12 month performance as it continued on its path to supremacy in the automotive world. Despite plant closings during the pandemic, the company increased production by over 30% to 500,000 vehicles. It will soon have capacity to manufacture 1.5 million vehicles in California, Berlin and Shanghai and is building a plant in Texas that will be the main production site for Tesla Semi (truck) and Cybertruck (pickup).
“While traditional automakers are now producing electric vehicles on a large scale, we consider Tesla’s technological edge to be very significant and there are interesting options around solar energy and autonomous driving where Tesla also has an edge.”
When evaluating the results for the year through April, Mr. Adair and Mr. MacColl found that the shares of Tesla and Sea Limited, a Southeast Asian gaming, e-commerce and payments company, had quadrupled.
Monks, emphasizing his focus on capital growth rather than income, declared a single final dividend of 2p per share, up from 2.5p for the previous fiscal year.