Ark Investment Management’s recent 13F filing reveals that as of June 30, it held about 2.76 million Tesla (TSLA) shares valued at approximately $1.16 billion. Despite slightly reducing its stake in Q2, Ark capitalized on the stock’s decline by purchasing an additional 450,000 shares between June 21 and August 5, underscoring a strong belief in the company’s potential.
As of August 19, Tesla’s stock was down about 23% year-to-date, falling behind peers in the “Magnificent Seven” stocks. While companies like Nvidia, Amazon, Apple, and Alphabet are seeing gains, Tesla’s disappointing earnings and reduced profitability have raised concerns.
However, Cathie Wood of Ark emphasizes that her investment thesis extends beyond just electric vehicles. Ark’s model projects a staggering $2,600 per share price target for Tesla by 2029, primarily driven by anticipated earnings from autonomous robotaxis. This projection aligns with Arc’s view that electric vehicles are not the core future value driver for Tesla.
Despite Tesla’s 25% increase in Q2 deliveries and the launch of its Robotaxi service, skepticism remains regarding the sustainability and profitability of its ambitious plans. Wood’s conviction is that Tesla’s long-term success hinges on its ability to scale its robotaxi operations, a critical factor that could support its lofty valuation.
In summary, Wood’s strategy reflects a belief that Tesla will evolve far beyond a conventional car company, positioning itself for significant growth in autonomous transportation. While the risks are substantial, history may prove her foresight to be justified if Tesla successfully navigates regulatory and operational challenges.
