TLDR
- Tesla’s stock rose 3.5% to close at $321.67, pushing its market value back above $1 trillion
- Cathie Wood’s ARK Invest bought 115,400 Tesla shares across two funds on Tuesday
- Tesla is set to report Q2 earnings on July 23, with Wall Street expecting 39 cents per share
- Vehicle deliveries fell 13.5% year-over-year to 384,000 cars in the second quarter
- ARK maintains a $2,600 price target for Tesla stock by 2029
Tesla stock jumped 3.5% on Wednesday, closing at $321.67 and pushing the electric vehicle maker’s market value back above the $1 trillion mark. The rally came after Cathie Wood’s ARK Invest disclosed additional purchases of Tesla shares.
ARK bought 115,400 Tesla shares on Tuesday across two funds – the ARK Innovation ETF and the ARK Next Generation Internet ETF. This marked the third Tesla purchase by ARK in July.
The timing of these purchases is interesting. ARK sold some Tesla stock in May when shares were trading around $350, ahead of Tesla’s June robotaxi service launch in Austin, Texas.
CATHIE WOOD BOUGHT $36M OF $TSLA STOCK TODAY pic.twitter.com/36aatHchtI
— Shay Boloor (@StockSavvyShay) July 16, 2025
The recent buys occurred with Tesla stock trading closer to $310 per share. This suggests ARK may be managing portfolio weights rather than making dramatic strategy changes.
Tesla remains the largest position in ARK’s Innovation ETF, accounting for almost 10% of the fund’s assets. When positions get this large, funds often need to trim holdings to avoid excessive concentration.
Wood maintains her bullish long-term view on Tesla. Her price target remains $2,600 by 2029, reflecting confidence in the company’s autonomous driving and energy storage potential.
Earnings Expectations
Tesla is scheduled to report second-quarter earnings on July 23. Wall Street analysts expect earnings per share of 39 cents, down from 52 cents in the same quarter last year.
The earnings decline reflects weaker vehicle deliveries. Tesla delivered approximately 384,000 cars in the second quarter, representing a 13.5% drop compared to the previous year.
Baird analyst Ben Kallo sees risks to Tesla’s estimates. He points to concerns about full-year volume outlook and potential margin compression in the energy segment.
Tesla originally hoped to increase volumes in 2025 from the 1.8 million cars sold in 2024. This growth was partly based on a new lower-priced model that hasn’t arrived yet.
Kallo projects second-quarter earnings of 41 cents per share, slightly above consensus. He rates Tesla stock at Hold with a $320 price target.
Recent Performance and Challenges
Tesla’s stock performance has been mixed this year. Coming into Wednesday’s trading, shares were down 23% year-to-date but up 21% over the past 12 months.
The company has faced several headwinds in recent quarters. Softening U.S. demand and fierce competition from Chinese EV makers like BYD have pressured sales.
Tesla has responded with price cuts of up to $7,500 on Models 3 and Y to counter lost EV tax credits. These cuts have helped maintain some volume but pressured margins.
The energy storage business has provided a bright spot. Tesla deployed a record 9.6 GWh in the second quarter, underscoring growth in the renewable energy sector.
Autonomous Driving Focus
Tesla’s robotaxi pilot in Austin has generated investor interest despite early traffic violations. The company uses Model Y vehicles equipped with Full Self-Driving technology for the service.
Tesla’s camera-based FSD approach differs from rivals like Alphabet’s Waymo, which uses lidar technology. Tesla’s method could prove more cost-effective if it achieves reliability.
The company plans to expand robotaxi services to California and other markets. Success in autonomous driving could unlock billions in potential revenue by 2026.
Tesla’s financial position supports continued investment in autonomous technology. The company maintains $23.8 billion in net cash, providing flexibility during market downturns.
Tesla’s current valuation of 10.6 times expected sales and 173 times expected earnings reflects investor optimism about autonomous driving potential rather than traditional automotive metrics.
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