Tesla, Inc. (TSLA) experienced a post-earnings sell-off recently, causing its stock to hit an eight-month low. However, Cathie Wood’s Ark Invest showed its confidence in the company by continuing to accumulate Tesla shares.
Ark Invest’s flagship exchange-traded fund, the Ark Innovation ETF (ARK), and the Ark Next Generation ETF (ARKW) acquired 182,541 Tesla shares on Friday, valued at $33.45 million. This followed a purchase of 177,870 shares or $32.48 million on the previous day when Tesla’s stock dropped by over 12%. In total, Ark Invest purchased $65.93 million worth of Tesla shares during the week.
Tesla’s stock has been on a downtrend since late October, reducing its annual gains to approximately 101%. Despite the decline, Wood remains bullish on the company and predicts that the stock will reach $2,000 by 2027. She believes that a significant portion of Tesla’s enterprise value will come from the yet-to-be-launched robotaxi service.
Ark Invest’s confidence in Tesla is evident in its holdings. The company is the second-largest holding of ARKK and the sixth-largest holding of ARKW. These investments demonstrate Wood’s belief in Tesla’s long-term growth potential.
While other mega-cap tech stocks experienced a recovery in the second half of January, Tesla continued to struggle. Traders remained cautious ahead of the company’s earnings report, uncertain about its fourth-quarter performance. Tesla reported a double miss in its earnings and also indicated a potential slowdown in volume growth in 2024, which further spooked investors.
Despite the challenges, Ark Invest’s continued accumulation of Tesla shares shows its unwavering faith in the company’s future prospects. Wood’s bullish outlook, coupled with Ark Invest’s investments, indicates that they view the recent dip in Tesla’s stock as a buying opportunity.
As of Friday’s close, ARKK was up 0.22% at $45.92. Wood’s belief in Tesla’s potential for growth remains strong, and she continues to support the company by accumulating shares.
