Cathie Wood-led Ark Investment Management said on Thursday it expects Tesla Inc TSLA stock to hit $4,600 by 2026, up from its current price of $985 a share.
The popular stock picker had last year estimated Tesla shares to hit $3,000 by 2025.
“Our 5-year price target has increased more than 50% to $4,600,” Wood said.
The 5-year forecast counts on Tesla’s recent promises to launch a dedicated robotaxi service.
The St. Petersburg, Florida-based Ark Invest in its latest report said that in the best case scenario the Elon Musk-led company’s stock could reach $5,800 a share by 2026, and in a bear case it could be around $2,900.
“Tesla’s prospective robotaxi business line is a key driver, contributing 60% of expected value and more than half of expected EBITDA in 2026,” Ark analyst Tasha Keeney wrote in the report.
“We expect electric vehicles to constitute 57% of the company’s revenue in 2026, albeit at substantially lower margins than robotaxi revenue.”
See Also: Tesla Bull Cathie Wood Shows Shifting Stance On GM After Months Of Dissing The Stock
Deliveries And Revenue Ahead: The research forecasts Tesla could sell 17 million electric vehicles by 2026 in the best scenario and only 10 million in a bearish scenario. Tesla last year sold a little less than a million cars.
Ark Invest sees Tesla’s 2021 average selling price of $49,000 slide lower to $38,000 by 2026 in a bullish scenario and about $30,000 in a bearish market.
The report has also estimated electric vehicle revenue to be between $372 billion to $513 billion by 2026, and that autonomous ride-hailing revenue would be up to $486 billion. It estimated electric vehicle gross margins would be 34%, up from 27% last year.
The model does not include other business opportunities such as Tesla’s humanoid project, energy business and its Dojo supercomputer as a service.
See Also: Tesla, Nio And More: How Cathie Wood's Ark Shuffled EV Bets In Q1
Ark Invest And Tesla: A Tesla superbull, Wood’s money managing firm counts the EV stock among its top holdings. Ark Invest held 1.46 million shares, worth $1.49 billion in Tesla, prior to Thursday's trade.
Price Action: Tesla stock closed 3.66% lower at $985 a share on Thursday and is down 18% year-to-date.
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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