ARK Invest Continues Buying Tesla TSLA, Adds Around $20M of Shares

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ARK Invest continues to buy Tesla shares in 2023. On Tuesday, the Cathie Wood fund added 177,142 shares to its portfolio, worth about $20 million.

Cathie Wood continues to ignore the wailings of some analysts covering Tesla and continues to add to its portfolio shares of the manufacturer, taking advantage of a unique opportunity. On Tuesday, ARK Invest ETFs bought another 177,142 Tesla shares worth about $20 million. 144,776 Tesla shares were bought by the flagship ETF ARK Innovation and another 32,366 ETF dedicated to autonomous technology and robotics.

Speaking to Barron's just before New Year, Wood told the publication that the stock could rise to $1,500 in the next five years, reaffirming her confidence in Tesla. Despite the current weakness in the stock, investors, who were worried about the demand for the company's cars, will return. Tesla is able to boost demand for its cars because it is so profitable that it can afford to cut prices just to lure customers back.

Wood believes that in the next few years, the company can drop the entry point on the Model 3 to just $25,000 from its current $45,000 and still make big profits.

“I think there are people who won’t buy his cars now,” she told Barron’s in an interview published late on Tuesday. “But if he does what we think he's going to do on the cost side, there are a lot of people who will use economics as their guide […] and I think there are a lot more of those people than there are of the naysayers around Twitter.”

According to Wood's estimate, Tesla will eventually earn over 80% margins thanks to its Full Self-Driving (FSD) software for Robotaxi, which is currently sold in the US for $15,000. “Combine that with their electric vehicle margins, which are 25%-30%, and we’ve got a 60%-plus company,” Wood explained. “No one's got that in their models. We do.”

© 2023, Eva Fox | Tesmanian. All rights reserved.

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