Cathie Wood-run Ark Invest on Friday bolstered its position in Tesla, Inc. TSLA even as the stock continued to decline.
Increasing Holdings: Ark, through its Ark Innovation ETF ARKK and Ark Next Generation Internet ETF ARKW, purchased 111,802 Tesla shares, valued at $24.47 million. Tesla closed Friday’s session down 3.67% at $218.89, according to Benzinga Pro data.
This marked a second consecutive day of purchases as Ark added 112,475 Tesla shares worth $25.56 million on Thursday. Together, the firm accumulated roughly $50 million worth of Tesla shares this week.
Tesla is the second-highest holding in Ark’s flagship exchange-traded fund, the ARKK, making up a weighting of 7.90%. The Elon Musk-led company’s stock is the top holding of the Ark Autonomous Technology & Robotics ETF ARKQ with a 11.98% weighting. It is the sixth-highest holding of ARKW with a 5.20% weighting.
Ark’s 13F, filed with the SEC in mid-October, showed that its Tesla stake stood at 4,078,651 shares valued at $1.02 billion.
Market Scenario: Tesla’s stock witnessed a 101% surge in 2023, and a substantial portion of the gains occurred predominantly in the early part of the year. A series of price cuts announced by the company last year led to reduced core auto margins, putting pressure on the stock in the second half of the year.
The weakness continued into the new year. The stock is down 11.91% so far in January amidst a sell-off in the tech space, especially the mega-caps. Tesla did not help its cause by announcing a price cut in China this week, further impacting investor confidence.
The stock could remain under pressure until the fourth-quarter earnings report due after the market close on Jan. 24. Analysts currently estimate earnings of 67 cents per share, down from $1.19 per share a year ago. Revenue may have also slipped 4.70% to $23.17 billion. Investors are eager to learn about the core auto gross margin and the 2024 deliveries guidance.