Sales of Cathie Wood’s Tesla shares hit $ 297 million this month – here’s what she’s buying instead

Top line

Joining a slew of insiders cashing in on Tesla shares, Ark Invest CEO Cathie Wood sold a growing number of company shares this month, choosing to splurge on tech stocks instead. in free fall which, according to the famous Wall Street investor, could soon recover. .

Highlights

According to Ark’s daily transaction reports, the company’s flagship ETF, Ark Innovation, sold another 41,457 shares of Tesla on Thursday, representing a stake worth around $ 31.4 million and s’ adding to separate sales of Ark’s funds totaling $ 266 million this month based on closing share prices.

While Tesla remains Ark’s largest stake, it is also the top-selling stock Ark has in September, surpassing sales by Nintendo, Swiss pharmaceutical company Roche Holding and software company Trade Desk. , which total approximately $ 50 million each.

Instead, Ark invested in New York-based automation firm UiPath, spending more than $ 185 million on roughly 3.4 million shares this month after the robotics firm’s shares plummeted. plunged 20% from an all-time high a few weeks after its IPO in April. .

The investment firm also spent around $ 96.5 million and $ 80 million to buy shares in streaming company Roku and Zoom Video Communications, two tech stocks that rebounded last year at the height of pandemic uncertainty, but have since lost up to 50% of their value.

Ark did not respond to Forbes’ request for comment, but on Tuesday Wood told an investing audience she believed the market would soon start to return to growth and innovation stocks after favoring sectors hardest hit by the pandemic earlier This year.

Ark’s other major buys this month include San Francisco cloud computing company PagerDuty, crypto exchange Coinbase, and healthcare companies Pfizer, Invitae, and Fate Therapeutics.

Surprising fact

Although she doubled her tech investments in Robinhood, Workday and Zillow, Wood actually got rid of big tech stocks in September, cutting her holdings in Alphabet, Facebook and Amazon to $ 24 million.

Tangent

Tech stocks dominated the market rally last year, generating massive returns for tech investors like Ark. However, starting this spring, accelerating economic growth and the threat of rising interest rates spurred a market rotation away from growth stocks, like tech stocks, with cyclical and market-oriented tranches. market value (such as energy and financial services). Although they have climbed around 14% in the last month, Tesla shares, priced at around $ 757, are down almost 15% from an all-time high in January, and the ETF Ark Innovation has only grown 5% since December after skyrocketing. almost 90% in the past year.

Key context

Following a surge in sales last year, Wood said Ark enjoys trading around Tesla’s inordinate volatility, taking advantage of low prices to buy and sell when she thinks prices might take a hit. “When we feel like analysts are hyperventilating about a stock, including Tesla, we naturally take profits because we know we’re going to have another controversial opportunity to buy the stock down. “Wood told CNBC. Despite its recent Tesla sales. Wood said last week that stock prices could skyrocket nearly 300% by 2025. However, Ark is not the only one among notable investors who recently pulled shares of Tesla. shares last week, according to regulatory documents.

Contra

While Wood is particularly bullish on Tesla, the consensus on Wall Street does not reflect the same high expectations. According to Bloomberg data, analysts’ average price target for Tesla shares is $ 701, which suggests prices could drop 8% over the next year.

Further reading

Cathie Wood’s Ark Invest Sells $ 110 Million In Tesla Shares As Insiders Ditch Shares Also (Forbes)

Cathie Wood of Ark Invest responds to the “Big Short” investor: he does not understand the “explosive growth” in technology (Forbes)

How Cathie Wood beat Wall Street by betting on Tesla worth over $ 1,000 billion (Forbes)

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