Cathie Wood, CEO of Ark Investment Management LLC remains optimistic about Tesla, despite the recent 45 per cent sales drop in Europe and even after shares tanked 31 per cent amid protests against owner Elon Musk.
Cathie Wood, a storied United States investor, presented a bullish view on Tesla during an interview with Bloomberg TV and predicted the auto company could reach stock price of $2,600 in five years.
Thus, while Tesla shares and sales are falling, we take a look at why Cathie Wood remains bullish on the EV major and predicts long-term new highs for the stock. The Tesla stock closed at $288.14 on March 25, data on Nasdaq showed.
Cathie Wood Predicts Tesla Stock Price to Jump 10x in Five Years
Cathie Wood expects Tesla stock to hit a $2,600 high in five years — that’s 10x its current share price. Her company Ark Investments continues to be a major investor in Elon Musk’s electric vehicle company — 10 per cent of ARK Innovation ETF’s $5.8 billion assets till 24th March was Tesla. This is notable 16 per cent less than December 2024.
Why the optimism? Robotaxis, she told Bloomberg TV. Cathie Wood believes that Tesla’s robotaxis will drive 90 per cent of its value over the next five years. Further, she also bet on innovation such as Tesla’s humanoid robots, that are not yet factored into calculations.
“If you look at metrics like range and power for a given price, Tesla is very competitive, if not the most competitive, depending on the model of car. Tesla and BYD are both in the lead from an EV point of view alone. If you are layering in robotaxi, of course BYD is not seizing the moment there, at least not yet,” Cathie Wood said.
Why Are Analysts Bearish on Tesla?
Cathie Wood’s prediction is in contrast to analysts, UBS Group AG’s Joseph Spak and Evercore ISI’s Chris McNally, who earlier in March cut their full-year estimate for vehicle deliveries by Tesla.
Notably, till March this year, Tesla has seen its shares slide 31 per cent, with many attributing this to protests against CEO Elon Musk due to his involvment in the Donald Trump administration. DOGE, the Elon Musk led government department, has slashed federal funding and let go of thousands of workers across the US since Donald Trump assumed power in January.
Its not just the shares, sales numbers for Tesla have been dismal across Europe and China — in Europe alone sales have slumped 45 per cent in 2024. In contrast, Chinese EV maker, a Tesla’s major rival BYD Co. has overtaken the American car maker by $10 billion in revenue, at $107 billion in 2024.
BYD to Have “Short-Term Hit”?
Cathie Wood, however, told Bloomberg that the China (BYD) impact would only be “a short-term hit” to Tesla’s stock, and maintained her five-year price target for Tesla’s stock.
She feels the “refresh” and lower priced variant of Tesla’s most popular car, the Model Y, together with the upcoming commercial start of its robotaxi services in Austin, Texas, would help the stock overcome current difficulties.
This is not the first time Cathie Wood has batted for Tesla. In 2023, an Ark analysis pegged Tesla to reach $2,000 by 2027.
Cathie Wood gained interest and popularity for her calls on Tesla, Roku and Zoom stocks during the COVID-19 pandemic. In early 2021, retail traders pushed her funds to over $60 billion in assets, as per the Bloomberg report.
(With inputs from Bloomberg)
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Business NewsMarketsStock MarketsTesla shares, sales are falling, but Cathie Wood remains bullish, predicts stock could hit $2,600 in 5yrs. Here’s why…
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26 Mar 2025, 01:16 PM IST
