Tesla, Inc.
TSLA pulled back over 6% intraday on Friday before recouping some of those losses and yet settled over 3% lower for the day. The downside catalyst was a Reuters report that said the electric-vehicle giant could be pulling the plug on its sub-$30,000 EV, although CEO Elon Musk took to social media to refute the report.
Amid the stock plunge, Cathie Wood’s Ark Invest accumulated another tranche of Tesla shares.
Ark Invest’s Move: Ark through two of its actively-managed exchange-traded funds bought 133,975 Tesla shares valued at $22.09 million (based on the closing price of $164.90). The details of the purchases are as follows:
- Ark Innovation ETF ARKK: 109,206 shares
- Ark Next Generation Internet ETF ARKW: 24,769 shares
Wood is a firm believer in Tesla and Musk and her firm has a $2,000 price target for the stock by 2027. Much of the celebrity stock picker’s optimism regarding Tesla is premised on the huge potential the planned robotaxi services offer.
The Significance of Ark’s Move: Friday’s sell-off reflected investor worries over a further volume weakness in the absence of a low-end model, especially as the economic conditions remain challenging. Future Fund’s Gary Black, who has been very vocal about the need for a low-end EV, said shelving the low-end platform and doubling down on the full self-driving (FSD) software would be “very risky and institutions would dump the stock since there would be little growth and high pricing risk until the robotaxi materialized — or not.”
But Deepwater Asset Management’s Gene Munster said this was the right move for Tesla. “Being the first to do full autonomy at scale is huge first mover advantage. While the event is in August, my guess is we see Robotaxi’s on the road in 2027,” he said.
Ark added more Tesla shares to its portfolio this week. Ahead of the deliveries update on Monday, the firm bought $14.75 million shares and following the update, it added another $39.16 million shares. It paused Tesla buying in the next two sessions before adding more shares on Friday.
With this Ark beefed up its Tesla holdings by $76 million in value terms this week alone.
Tesla is Ark’s flagship ETF ARRK’s second biggest holding, with a portfolio weighting of about 9.5%.
Ark’s Liquidations: Friday, Ark continued selling two of its crypto-linked portfolio stocks, namely Coinbase Global, Inc. COIN and Robinhood Markets, Inc. HOOD. It sold 62,615 Coinbase shares, valued at $15.08 million, and 925,585 Robinhood shares valued at $17.03 million.
ARKK closed Friday session down 0.32% at $47.12, according to Benzinga Pro data.
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