Cathie Wood's Bold Tesla Bet: Predicting a Tenfold Surge to $2,600 Amid Market Challenges

Despite Tesla's stock nosediving over 30% this year, unwavering confidence prevails among many loyal supporters of Elon Musk. Cathie Wood, Tesla's most ardent advocate and renowned fund manager, reiterated her optimism for Tesla's future, forecasting a staggering surge to $2,600 per share within five years, representing a potential tenfold increase.

In an interview, Wood emphasized that Tesla's autonomous taxi business is poised to constitute 90% of its valuation eventually. Speaking at the HSBC Global Investment Summit in Hong Kong, she accentuated Tesla's foray into humanoid robots, which remains absent from Ark Investment's current valuation models.

Wood highlighted Tesla's competitive edge over Chinese rival BYD, based on metrics such as range and power at specific price points. Notably, last year marked a historic moment when BYD surpassed Tesla with sales exceeding $100 billion for the first time.

As of March 24, Tesla stands as the largest holding in Wood's flagship Ark Innovation Fund (ARKK), comprising 10% of its $5.8 billion allocation. This marks a decrease from nearly 16% at the end of 2024, largely due to Tesla's substantial share price decline this year.

On Monday, Tesla's shares saw a noteworthy 12% uptick among major stocks, fueled by optimism surrounding President Trump's tariff plans, which suggested less severe impacts than initially anticipated. Reports indicated a delay in auto industry tariffs starting April 2, alleviating concerns about potential profit dents for Tesla.

Nonetheless, Tesla's stock remains significantly down by over 30% year-to-date, with tepid sales in Europe and China and CEO Elon Musk's responsibilities impacting brand perception. Wood gained prominence during the pandemic by boldly investing in companies like Tesla, Zoom, and Roku, which thrived amid global disruptions.

In previous analyses dating back to 2023, Wood projected Tesla's share price reaching $2,000 by 2027, fueled by gains from traditional automakers. More recently, in July last year, she reiterated that launching an autonomous taxi platform could propel Tesla's stock tenfold, catalyzing growth.

Interestingly, Cathie Wood is not alone in her bullish stance. Amid Tesla's recent stock dips, retail investor enthusiasm has reached unprecedented levels. Strategy data reveals that retail investors have consecutively net bought Tesla stock over 13 trading days, with $80 billion funneled in, marking record highs.