In a bold move defying the prevailing skepticism on Wall Street, Cathie Wood, founder of Ark Invest Management, has actively embraced the recent downturn in Tesla Inc. stock. Amidst a challenging month for the electric-vehicle giant, Wood strategically acquired nearly 690,000 shares in January across ARK’s flagship funds.
The two primary exchange-traded funds (ETFs) under cathie wood ark management, the ARK Innovation ETF (ARKK) and the ARK Next Generation Internet ETF (ARKW), reportedly invested an estimated $141 million in Tesla shares during this buying spree. Despite widespread concerns over the auto industry’s outlook and Wall Street’s lukewarm sentiment toward Tesla, Wood’s conviction in the company remains unwavering.
This buying spree marks a notable shift in Wood’s recent stance on Tesla. After selling shares for three consecutive quarters, the fund manager has demonstrated renewed confidence in the electric-vehicle maker. Tesla, currently facing a 25% drop in its stock price this month, experienced additional pressure after a fourth-quarter earnings report hinted at a slower expansion in 2024.
Despite Tesla’s recent challenges, cathie wood’s long-standing bullish sentiment persists. The ARK Innovation ETF and ARK Next Generation Internet ETF continue to hold Tesla as their third and sixth largest holdings, respectively. Wood’s admiration for Elon Musk’s company extends to her firm’s research team, which projects a lofty target of $2,000 for Tesla shares by 2027, with the robotaxi business cited as a key driver.
The recent buying activity followed Tesla’s disappointing earnings report, revealing the company’s tempered growth expectations for the coming year. Wood’s acquisition of over 360,000 shares immediately after the report suggests a strategic move to capitalize on what she perceives as a temporary downturn.
Garrett Nelson, Vice President and Senior Equity Analyst at CFRA Research, interprets wood cathie actions as a sign of conviction in Tesla’s long-term narrative. He notes, “We think it shows conviction in the long-term story, and we believe a lot of investors were waiting for a buying opportunity after TSLA shares more than doubled last year. They are getting that opportunity now with the stock’s year-to-date selloff.”
As the market closely watches catherine wood ark invest latest moves, her commitment to Tesla underscores a belief in the transformative potential of the electric-vehicle industry and the company’s role in shaping the future.