After months of cutting and waiting, Ark Invest is once again growing its holding in Elon Musk’s Tesla (TSLA) – Get Free Report.
The investment firm snapped up a total of 105,201 shares of Tesla Wednesday, a purchase valued at around $25 million. The move was spread across Ark’s Next Generation Internet ETF (ARKW) – Get Free Report and Ark’s flagship Innovation ETF (ARKK) – Get Free Report, which alone picked up 91,194 shares of the stock.
Ark Innovation’s Tesla holding, the second largest name in the portfolio, is made up of 2.81 million shares, valued at $670.9 million and weighted at 7.96% of the fund.
Related: Cathie Wood buys into a favorite stock for the first time in months
This is the second time in recent weeks that Ark Invest moved to boost its Tesla holding, previously buying around 111,000 shares of the stock on Dec. 21.
Still, Ark’s Tesla holding is far off where it was in June, when the ETF owned roughly 3.5 million shares of the company.
Shares of Tesla, which more than doubled in 2023, closed Wednesday down around 4%.
The company is set to report fourth-quarter earnings results after the bell Jan. 24.
Related: What’s stopping Tesla from achieving Level 3 self-driving
Tesla’s 2023
Ark’s purchase comes in the wake of the release of Tesla’s 2023 delivery and production numbers; the automaker sold 1.81 million vehicles in 2023, and 484,507 in the previous quarter alone, roughly in line with Wall Street expectations.
Wedbush analyst Dan Ives called the numbers a “win” for Tesla.
At the same time, electric vehicle competition is increasing, particularly in China.
Chinese automaker BYD sold 1.6 million EVs and 1.4 million hybrids in 2023, notably beating out Tesla for EV sales in the fourth quarter.
But Musk isn’t too concerned — he wrote in a Wednesday post that Tesla is an “AI/robotics company that appears to many to be a car company,” a sentiment that Ives, Ark Invest and several other Tesla bulls have expressed before.
Morgan Stanley analyst Adam Jonas wrote in a Wednesday note that Tesla’s car business is merely an “accelerator laboratory” for the company’s development of related technology and software.
“We believe the stock will increasingly be driven by other factors, particularly as the company’s business model diversifies away from selling cars over time,” he said.
Only 23% of Jonas’ $380 price target is based on Tesla’s auto business.
Tesla, according to TipRanks, has an average price target of $246, slightly above its current levels.
Ark Invest said in April that shares of Tesla will be trading at $2,000 by 2027, a valuation powered by the mass adoption of the company’s currently nonexistent robotaxi.
Related: Investment bank agrees with Elon Musk on the true driver of Tesla’s stock
Get exclusive access to portfolio managers’ stock picks and proven investing strategies with Real Money Pro. Get started now.
