A large European asset manager recently made adjustments in its U.S.-traded stock investments that seem to favor electric vehicles over traditional car makers.
DNB Asset Management materially increased investments in EV maker Tesla and Plug Power $(PLUG)$, a hydrogen fuel-cell technology company, while slashing its stake in General Motors $(GM)$ in the fourth quarter. The unit of Norway's largest financial-services firm, DNB, disclosed the stock trades, among others, in a form it filed with the Securities and Exchange Commission.
DNB, which manages about $87 billion in assets, declined to comment on the stock trades.
Tesla stock dove 65% in 2022, compared with a 19% drop in the S&P 500 index. So far in 2023, the shares are up 8.3%, while the index has added 3.5%. DNB bought 87,491 more Tesla shares in the fourth quarter to end 2022 with 617,655 shares.
Most of the slide in Tesla shares last year was in the fourth quarter. A major part of the backdrop was the closing of Tesla CEO Elon Musk's acquisition of social-media platform Twitter. Musk's tenure at Twitter has been volatile, and issues there seem to inordinately affect Tesla stock. Apart from Twitter, the auto maker lost market share in the fourth quarter, and Tesla has been cutting prices in the new year.
In December, Plug Power announced an alliance with Tesla rival Nikola $(NKLA)$, which makes battery- and hydrogen-powered semi-trucks and has an energy-solutions division. Plug Power had disclosed project delays in October, followed by a November announcement of lower-than-expected third-quarter sales.
Plug Power stock dove 56% in 2022, but so far in 2023 shares have surged 29%. Part of the surge in the new year came with the Jan. 10 announcement that Plug Power received a contract to provide hydrogen-liquefaction systems to TC Energy $(TRP.UK)$.
DNB bought 243,041 more Plug Power shares to end the fourth quarter with 2.1 million shares.
DNB sold 687,060 GM shares in the quarter, slashing its stake to 210,901 shares. GM stock crumbled 43% in 2022, and so far in January shares are up 5%.
GM may be known as a maker of conventional, gas-powered cars, but it is also a formidable competitor to Tesla for EVs. GM's EV business isn't now profitable, but the company expects it to be "solidly profitable" by 2025. CEO Mary Barra told us in November that investors and analysts "don't understand the power that we have and that we're funding this transformation" to EVs from conventional cars.
Inside Scoop is a regular Barron's feature covering stock transactions by corporate executives and board members -- so-called insiders -- as well as large shareholders, politicians, and other prominent figures. Due to their insider status, these investors are required to disclose stock trades with the Securities and Exchange Commission or other regulatory groups.
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