Cathie Wood’s ARK Invest ETFs (exchange-traded funds) made a major investment in the electric vehicle (EV) space on July 24. The ace hedge fund manager’s largest trade of the day was a $47.6 million purchase of Tesla (TSLA) stock. The company recently released its second-quarter earnings report. Despite the weaker-than-expected results, Wood continues to buy Tesla shares, showing trust in the company’s long-term outlook and in CEO Elon Musk.
Elevate Your Investing Strategy:
- Take advantage of TipRanks Premium at 50% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence.
According to Thursday’s daily trade disclosures, ARK bought a total of 143,190 Tesla shares across the ARK Innovation ETF (ARKK), ARK Autonomous Technology & Robotics ETF (ARKQ), and ARK Next Generation Internet ETF (ARKW), making it one of the fund’s biggest Tesla buys in recent months.
Why Wood Is Loading Up on Tesla Stock
Wood appears to be capitalizing on the recent sharp decline in Tesla shares following its Q2 earnings. The stock dropped 23% in after-hours trading and ended the next day down 8%.
During the earnings call, Musk doubled down on Tesla’s future in robotaxis and AI. He said the company would invest over $10 billion this year in its Optimus humanoid robot and AI infrastructure. Still, he warned of a “few rough quarters” ahead as EV credits phase out and policy changes add pressure.
Despite the earnings miss and warning from Musk, several analysts maintained their ratings on the stock. Stifel analyst Stephen Gengaro kept his Buy rating and $450 price target, calling the quarter “neutral.” He highlighted positives such as the early rollout of Tesla’s robotaxi fleet in Austin and progress on the company’s low-cost vehicle. While Gengaro noted concerns around weak demand, tariffs, and slow model launches, he said Tesla’s Full Self-Driving (FSD) and robotaxi efforts are key to its long-term upside.
Wood Still Trusts Musk’s Vision
Cathie Wood remains confident in Elon Musk’s leadership. She recently pointed to his decision to personally oversee Tesla’s U.S. and European sales as a sign of renewed focus. “When he puts his mind to something, he usually gets the job done,” she said.
While Musk’s political moves, like launching the “America Party,” have drawn headlines, Wood said controversies are nothing new. ARK Invest continues to back Tesla’s board and steers clear of political matters.
Beyond Tesla, Wood has also invested in Musk’s private ventures, including SpaceX, Neuralink, and xAI. She believes Tesla stock could hit $2,600 within five years if the robotaxi business scales as expected.
Is TSLA Stock a Buy Now?
Turning to Wall Street, TSLA stock has a Hold consensus rating based on 14 Buys, 13 Holds, and six Sells assigned in the last three months. At $313.25, the average Tesla price target implies a 2.60% upside potential. The stock has declined 23% over the past six months.
Stay tuned: A breakdown of Cathie Wood’s other July 24 trades, including Iridium, Coinbase, and Roblox stocks, follows in the next article.