Another Banner Quarter for Tesla: ETFs to Buy
After the closing bell on Wednesday, Tesla Motors TSLA reported robust Q1 earnings, beating the estimates for both earnings and revenues. The electric carmaker posted record quarterly revenues and a big jump in profit margins.
Following stronger-than-expected results, shares of Tesla jumped as much as 6% in aftermarket hours. Investors should tap the strength through ETFs — Simplify Volt Robocar Disruption and Tech ETF VCAR, Consumer Discretionary Select Sector SPDR Fund XLY, Fidelity MSCI Consumer Discretionary Index ETF FDIS, Vanguard Consumer Discretionary ETF VCR and MicroSectors FANG+ ETN FNGS — with a substantial allocation to this luxury carmaker.
Q1 Earnings in Focus
Adjusted earnings per share came in at $3.22, easily beating the Zacks Consensus Estimate of $2.15 and improving from the year-ago earnings of 93 cents. Revenues jumped 80.5% year over year to $18.7 billion and edged past the Zacks Consensus Estimate of $17.3 billion. Revenue growth was attributable to an increase in the number of cars Tesla delivered, and an increase in average sales prices.
Tesla delivered a record 310,048 (295,324 Model 3 and Y, and 14,724 Model S and X) vehicles. This represents a slight increase from Q4, and was up 68% from a year-ago quarter. The electric carmaker produced 305,407 (291,189 Model 3 and Y, and 14,218 Model S and X) vehicles during the quarter (read: 5 ETFs to Ride on Tesla's Record Q1 Deliveries).
ETFs to Buy
Simplify Volt Robocar Disruption and Tech ETF (VCAR)
Simplify Volt Robocar Disruption and Tech ETF is an actively managed ETF, seeking concentrated exposure to the leader of autonomous driving technology. It employs a call option overlay to boost performance during extreme moves up in Tesla, while holding a tech index for diversification and put options as a hedge.
Simplify Volt Robocar Disruption and Tech ETF charges investors 0.95% in annual fees. It has accumulated $8 million in its asset base while trading in an average daily volume of 11,000 shares.
Consumer Discretionary Select Sector SPDR Fund (XLY)
Consumer Discretionary Select Sector SPDR Fund offers exposure to the broad consumer discretionary space by tracking the Consumer Discretionary Select Sector Index (read: US Consumer Sentiment Improves in April: Will ETFs Gain?).
Consumer Discretionary Select Sector SPDR Fund is the largest and most popular product in this space, with AUM of $19 billion and an average daily volume of around 12 million shares. Holding 60 securities in its basket, Tesla takes the second spot with 21% of assets. Consumer Discretionary Select Sector SPDR Fund charges 10 bps in annual fees and has a Zacks ETF Rank #2 (Buy) with a Medium risk outlook.
Fidelity MSCI Consumer Discretionary Index ETF (FDIS)
Fidelity MSCI Consumer Discretionary Index ETF tracks the MSCI USA IMI Consumer Discretionary Index, holding 329 stocks in its basket. Of these, TSLA takes the second spot with a 16% share. Internet & direct marketing retail makes up for the top sector with a 26% share, followed by automobiles (18.6%), specialty retail (17.7%), and hotels, restaurants & leisure (17.1%).
Fidelity MSCI Consumer Discretionary Index ETF has amassed $1.4 billion in its asset base while trading in a good volume of around 134,000 shares a day on average. Fidelity MSCI Consumer Discretionary Index ETF charges 8 bps in annual fees from investors and has a Zacks ETF Rank #2 with a Medium risk outlook.
Vanguard Consumer Discretionary ETF (VCR)
Vanguard Consumer Discretionary ETF currently follows the MSCI US Investable Market Consumer Discretionary 25/50 Index and holds 305 stocks in its basket. Of these, Tesla occupies the second position with a 16.7% allocation. Internet & direct marketing retail takes the largest share at 25%, while automobile manufacturers, restaurants and home improvement retail round off the next two spots (read: 6 Solid Sector ETFs to Buy Now).
Vanguard Consumer Discretionary ETF charges investors 10 bps in annual fees, while volume is moderate at nearly 118,000 shares a day. The product has managed about $6.1 billion in its asset base and carries a Zacks ETF Rank #2 with a Medium risk outlook.
MicroSectors FANG+ ETN (FNGS)
MicroSectors FANG+ ETN is linked to the performance of the NYSE FANG+ Index, which is an equal-dollar-weighted index designed to provide exposure to a group of highly traded growth stocks of next-generation technology and tech-enabled companies. It holds 10 equal-weighted stocks in its basket, with Tesla accounting for a 10% share.
MicroSectors FANG+ ETN has accumulated $62.9 million in its asset base and charges 58 bps in annual fees. It trades in an average daily volume of 26,000 shares and has a Zacks ETF Rank #3 (Hold).
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Tesla, Inc. (TSLA) : Free Stock Analysis Report
Consumer Discretionary Select Sector SPDR ETF (XLY): ETF Research Reports
Vanguard Consumer Discretionary ETF (VCR): ETF Research Reports
Fidelity MSCI Consumer Discretionary Index ETF (FDIS): ETF Research Reports
MicroSectors FANG ETN (FNGS): ETF Research Reports
Simplify Volt Robocar Disruption and Tech ETF (VCAR): ETF Research Reports
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