Despite Tesla's stock price having dropped more than 30% this year, some investors remain optimistic about its long-term prospects. On Monday, renowned fund manager Cathie Wood, known as "ARK's Cathy," once again expressed her firm confidence in Tesla, predicting that the stock could rise nearly tenfold over the next five years to reach $2600.
As the founder of ARK Invest, Wood stated that Tesla's autonomous taxi business will account for 90% of the company's valuation in the future. She added at the HSBC Global Investment Summit on Tuesday that the company's research and development in the "Optimus" humanoid robot has not yet been included in the current valuation models, and if it succeeds, it will provide further upside potential for Tesla's valuation.
Although BYD surpassed Tesla last year with sales exceeding $100 billion for the first time, Wood still believes Tesla maintains a relative competitive edge in terms of range, power, and cost.
As of March 24, Tesla remained the largest single holding in the ARK Innovation Fund (ARKK), accounting for 10% of its market value, although down from 16% at the end of 2024, mainly due to the drop in stock price.
Notably, Tesla's stock led gains among the "Big Seven" tech stocks on Monday, soaring nearly 12%, which marked the largest single-day gain since November. Market optimism speculated that Trump's tariff plans might be delayed, easing previous concerns over the automotive industry, especially on Tesla's profit margins.
However, even with a short-term rebound, Tesla still faces significant challenges. Its sales and deliveries in the European and Chinese markets have recently declined sharply, and some investors worry that founder Elon Musk's involvement in the government efficiency department (DOGE) may affect Tesla's brand image and market focus.
Nevertheless, Tesla's popularity among retail investors continues to rise. Data from JP Morgan shows that as of last Thursday, retail investors have been net buyers of Tesla stock for 13 consecutive trading days, with total investments reaching $8 billion, setting a record high and demonstrating ordinary investors' strong enthusiasm for the stock.
As early as 2023, Wood had predicted that Tesla's stock price would reach $2000 by 2027, expecting the company to vastly expand its market share in the coming years through its autonomous taxi platform and technological leadership. Now, despite market turbulence, she still maintains a strong bullish stance.
