Can Tesla save Cathie’s ARK? 🚣♀️ Last week investors got a glimpse of just how tough the fall in high-flying ‘innovation’ shares has been on ARK Invest’s exchange traded funds (ETFs). ARK’s flagship Innovation ETF (ARKK) dropped almost 30% in the first three months of 2022, and Wood revealed that just four companies of the more than 30 companies held in the fund had mustered positive contributions. Two of the biggest losers were Zoom (ZM) and ROKU (ROKU) due to the pandemic darlings falling out of favour faster than our obsession with sweatpants. 

ARK’s one true saviour in the quarter was Tesla (TSLA). Tesla announced an electrifying first quarter result last week zooming ahead of expectations for revenue and delivering a record 310,000 cars*. 🚗🚗🚗 With Tesla comprising around 10% of ARK’s Innovation ETF, that sounds like good news. But how much are those Tesla shares really worth? ARK Invest Analyst Tasha Keeney reckons Tesla could be worth US$4,600 per share in 2026, a step up from ARK’s previous 2025 estimate of US$3,000 per share. The new target is more than 4x higher than Tesla’s current share price. But they’re a lone wolf in this thinking, and it’s a world away from the median 12-month price forecast of US$1,138 per share collated from 36 analysts tracked by CNN. 

So what’s ARK seeing that the others aren’t? ARK says it expects big things from Tesla’s prospective robotaxi business…a business that doesn’t exist yet, but which could be a significant driver of earnings in the future. Robotaxi’s could let Tesla owners put their cars to work ferrying others around when they’re not using them, like a driverless Uber (UBER). Elon Musk has pencilled in robotaxis for 2024. But given Tesla’s repeated delays in full self-driving and Cybertruck deliveries, it might take earnings from robotaxi’s a while yet to really kick into, um, gear. 🚕