Billionaire investor Ron Baron predicted that Tesla Motors Inc. will become one of the biggest companies in the world over the next decade or two, growing twentyfold to a market value of about $700 billion.
His comments on Tuesday sent shares up 6.2 percent, the most since February. Baron, chairman and chief executive officer of Baron Capital Management, is one of Tesla's biggest investors. His firm has amassed a stake in the electric-car company worth about $325 million, or 1 percent of its total market value. He spoke about the investment on financial news network CNBC.
Baron, 73, said there's a "very good chance" he'll own the Tesla stake for 10 to 20 years, expecting returns of $6 billion to $7 billion over that time. Having purchased shares at about $210 on average, that would imply a market value of from $640 billion to $722 billion and an annual return ranging from 15 percent to 30 percent for the foreseeable future.