Cathie Wood-led Ark Invest scooped up more shares in Tesla Inc TSLA on Tuesday, a day after the money managing firm resumed buying shares in the Elon Musk-led company. The stock has plunged 37% in a month in the backdrop of production issues in China and the billionaire entrepreneur’s bid to buy Twitter Inc TWTR for $44 billion.
The popular money managing firm bought 26,081 shares — estimated to be worth $16.38 million— in the Austin, Texas headquartered electric vehicle maker.
Tesla shares closed 6.9% lower at $628.16 on Monday, sinking to their lowest levels since June. The stock has declined over 37% over the past month and over 45% since April 4, when Musk revealed a significant stake in Twitter.
Ark Invest had been booking profits in its Tesla stake since late February before the EV maker was hit by strict COVID-19 curbs in Shanghai, until Monday, when it resumed buying.
Growing competition in the sector and Musk’s Twitter ‘circus show’ and ‘soap opera' too have contributed to the stock weakness, according to some analysts.
St. Petersburg, Florida-based Ark Invest owns shares in Tesla through three of its six actively traded exchange funds: Ark Innovation ETF ARKK, Ark Autonomous Technology & Robotics ETF ARKQ, and Ark Next Generation Internet ETF ARKW.
The three ETFs held 1.29 million shares worth $873 million in Tesla before Tuesday’s trade.
The value of Tesla holdings that Ark Invest owns has shrunk by more than half since the beginning of the year.
Long-time Tesla bull Daniel Ives, an analyst at Wedbush Securities, last week lowered his price target for Tesla to $1,000 from $1,400, citing the issues in China.
The analyst also believes Musk’s 'circus show' with respect to the Twitter acquisition has been a major overhang on Tesla's stock and a black eye for Musk for the way he has handled the “spiraling situation.”
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