ARK's Cathie Wood made a monster call in 2018 that Tesla stock would hit $4,000. Her prediction just came true 2 years early.
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Matthew Fox
Jan 9, 2021, 00:57 IST
ARK Invest
ARK Invest's Cathie Wood made a monster call in 2018, predicting that Tesla would hit $4,000 in five years, representing potential upside of about 1,200% at the time.
The head-turning call, which was doubted by many, came as Tesla was struggling to scale its Model 3 production and was facing a liquidity crunch.
On Thursday, Tesla surged more than 7% and hit Cathie Wood's $4,000 price target on a split adjusted basis.
Detailed below is where ARK Invest thinks Tesla stock could go next.
On Thursday, Tesla hit Wood's price target, with shares closing at $816, or $4,080 on a split adjusted basis. Last Summer, Tesla executed a 5-for-1 stock split.
The meteoric rise in Tesla came as the company successfully scaled production of its Model 3. In 2020, Tesla missed its 500,000 unit delivery goal by just a few hundred vehicles, even amid a pandemic that shut down its California production facility for more than a month.
Other factors that helped drive Tesla shares up 743% in 2020 included its December addition into the S&P 500 index and investors attaching a premium to electric vehicle manufacturers on the prospects of a Joe Biden presidency and his green energy agenda.
With Tesla hitting Wood's target two years ahead of schedule, the firm now has a $7,000 price target for Tesla, or $1,400 split adjusted, representing potential upside of 72% from Thursday's close.
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"Based on our updated expectations for electric vehicle (EV) cost declines and demand, as well as our estimates for the potential profitability of robotaxis, our 2024 expected value per share for TSLA is $7,000," ARK analyst Sam Korus said last year.
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