Why This Investor Is Buying Tesla Stock Following Pullback

Tesla Inc's TSLA stock has been trending higher over the last month as momentum traders pile into the name. Although the stock is still up more than 20% over a one-month period, it has pulled back about 10% from recent highs.

NewEdge Wealth's Rob Sechan decided to buy Tesla shares following the pullback.

"This is going in a very specific portfolio of ours," Sechan said Friday on CNBC's "Fast Money Halftime Report."

Sechan said he bought Tesla stock for his top 10 best short-term ideas portfolio. Sechan runs the portfolio in partnership with Fundstrat's Tom Lee.

"He's managed to convince me, while I might not buy the car, I should buy the stock and I think it makes a lot of sense here being off from its highs," he said. "So it could be a short-term rental for us but we're definitely going to own it for a little bit and think we're going to make some money on it."

See Also: Cathie Wood's Ark Continues Profit-Booking In Tesla, Selling Another $39M Worth Of Shares

Tesla's battery costs are coming down and margins continue to expand. The company's opportunity is in batteries, AI and software, Sechan said.

"There's no doubt they are defining the next generation of automobiles."

TSLA Price Action: Tesla has traded as high as $1,243.49 and as low as $443.50 over a 52-week period.

The stock was up 0.96% at $1,106.92 at the time of publication.

Photo: courtesy of Tesla.