Ark Investment Management LLC, led by Cathie Wood, continues to have a positive outlook on Tesla (TSLA, Financial), predicting that the stock price could reach $2600 within five years, nearly ten times its current value. Wood highlighted Tesla's developments in autonomous robotaxis, which she expects to comprise 90% of the company's projected value. During the HSBC Global Investment Summit in Hong Kong, she also mentioned Tesla's plans in the humanoid robot space, which Ark has not even factored into its price forecast.
Despite a recent recovery over the last four trading days, Tesla shares have fallen by 31% this year. Founder Elon Musk faces political challenges, resulting in decreased sales and shipments in major markets like Europe and China. Notably, Tesla's vehicle registrations in Europe fell 40% in February compared to the previous year, according to the European Automobile Manufacturers Association. Analysts, including Joseph Spak from UBS and Chris McNally from Evercore ISI, have revised their delivery forecasts lower.
In China, Tesla faces intense competition from local rival BYD, which surpassed Tesla in sales, reaching over $100 billion last year. Wood believes that even if Tesla struggles in China, it will only be a "short-term setback" and won't affect the company's five-year price target. She points out Tesla's strong competitiveness in metrics like range and power, claiming Tesla remains a leader in electric vehicles, alongside BYD. While BYD has yet to capitalize on autonomous taxi technology, Tesla is well-positioned in this arena.
Tesla remains the largest holding in Ark's flagship ARK Innovation ETF, accounting for 10% of its $5.8 billion assets as of March 24.
