Cathie Wood Sells Tesla, Invests in Key ‘Magnificent Seven’ Stock
Cathie Wood, CEO of Ark Invest, has made headlines recently for her strategic moves in the stock market. Known for her focus on innovative technology and investments in companies that drive significant change, Wood’s recent decisions involve both Tesla and Amazon, two key players in the ‘Magnificent Seven’ stock list.
Cathie Wood’s Investment Shifts
Wood’s Ark Innovation ETF recently sold approximately 181,300 shares of Tesla (TSLA), though it remains the fund’s top holding. The fund still holds over $1 billion worth of Tesla stock, representing about 12.4% of its total capital. Despite the sale, Ark continues to maintain a bullish outlook on Tesla. Wood has projected a remarkable $2,600 price target for Tesla shares by 2029, indicating significant growth potential from its current levels.
Tesla’s Growth Prospects
Tesla’s growth strategy is heavily reliant on its autonomous robotaxi fleet. Ark Invest anticipates that this fleet will generate 63% of Tesla’s estimated $1.2 trillion revenue in 2029. Additionally, revenue contributions are expected from various sectors:
- Electric Vehicles: 26%
- Stationary Energy Storage: 10%
- Insurance: Small percentage
Ark’s estimate does not yet include potential revenues from Tesla’s humanoid robots, expected to create a $24 trillion market opportunity. Wood believes these robots could drastically boost productivity by handling tedious chores.
Amazon: A Growing Position
Contrarily, Ark has increased its holdings in Amazon (AMZN). As of October 30, the Ark Innovation ETF owned nearly 554,000 shares, valued at over $127.5 million, making it the fund’s 16th largest position. Amazon has had a challenging year but recently showed signs of recovery through strong third-quarter earnings reports.
Amazon’s Business Resilience
- Market Cap: $2,675 billion
- Current Price: $243.04
- Gross Margin: 50.05%
- Cloud Revenue Growth: 20% year-over-year
Despite ongoing challenges such as tariff impacts, Amazon’s strategic investments in AI infrastructure have pleased investors. The company announced layoffs of 14,000 corporate employees, aiming to streamline operations.
Conclusion
While Cathie Wood’s recent selling of Tesla shares may have surprised some investors, her continued confidence in the company aligns with her broader vision for long-term growth in innovative technologies. Simultaneously, her increased investment in Amazon signals a strong belief in both companies as leaders in the evolving market landscape. With the AI boom on the horizon, both Tesla and Amazon are positioned to benefit significantly.
