Ark Invest Buying up Tesla Shares As Price Spikes

For three quarters in a row, Ark Invest sold its Tesla (TSLA) shares. Since December, Cathie Wood’s company has been buying them up, though.

Ark Invest might prove to be wise with its buying decision, as Tesla is now up 4.9% from Friday and could be starting to climb back up toward its previous highs. The company’s stock has done poorly over the last few months, trending down overall and dropping from $234 per share to its current price of $172 per share.

That is over the course of three months, and long-term investors of Tesla stock have been wondering if they should sell or if the company will turn things around. Tesla has lost almost a third of its market share in 2024 and a lot of investor support.

First quarter sales numbers for Tesla were dire in 2024. The company said it sold far less cars than it expected, widely missing sales margins. Bloomberg released a sales estimate for Tesla for the current 12-month period, and they lowered the sales estimates by 30% following first quarter sales figures. Tesla is suffering from its worst sales outlook in two and a half years.

Should You Buy Tesla Stock?

Ark Invest seems to think that buying Tesla stock right now is a good choice. That could be because the company has proven its resiliency before and is currently at a low, entry-friendly price. Anyone expecting the stock to do well later on this year may want to take advantage of the currently rock bottom prices before they increase.

The price-to-earnings ratio of Tesla stock is lower than it was at the start of the year- at 39.8. That makes it a tempting buy right now, especially if Tesla manages to turn things around. The company has major plans for 2024, with most of its efforts aimed at cutting costs in a variety of ways. The company recently scrapped its plans for a low cost model that could have hurt its profit margins, and they are poised to become even bigger players in the robotics industry moving forward.

We do not want to give you a definitive answer on whether to buy Tesla right now, but for those who have faith in the company’s ability to recover, it makes sense to dive in at the current low point.