Cathie Wood Explains Why the Bulls Believe in Tesla
Our price target for Tesla in 2030 is $2,600, and our confidence has gone up now that Tesla is commercializing robotaxis.
— Cathie Wood
Wood’s optimism never travels light. In 2014, when she founded ARK Invest, she was laughed at by former colleagues. Yet, today, her fund has nearly $7 billion under management and her personal net worth is estimated in the hundreds of millions of dollars.
In today's quote, from May 2025, Wood explains the bull case for Tesla. Here's the full thought:
Our price target for Tesla in 2030 is $2,600, and our confidence in that number has gone up now that Tesla is commercializing robotaxis. What we don’t have in that number, and what is happening faster than we expected, is humanoid robots. Elon has been talking about that market being bigger ultimately than the robotaxi market, and he talks about Tesla being number 1 globally when it comes to humanoid robots. We think that’s a $26 trillion dollar revenue opportunity, split between home and industrial, in the next five to 10 years. It’s going to be a huge market.
And the reason Tesla is ahead of the game is we’re talking about the three platforms it’s already innovating on: robots because robotaxis are robots, energy storage because they will be electric, and AI. Those are the three technologies in the humanoid robot movement, as well.
— Cathie Wood
In the month she made the $2,600 prediction for Tesla, the company's share price peaked at about $363. Since then, it has slid about 11 percent, dragged down by a 13.5 percent year-on-year drop in Q2 car sales. Wood believes that car sales don't matter much as they are just a warm-up act for self-driving taxis and humanoid robots.
Wood may very well be right about Tesla's future. Yet, I prefer businesses that already deliver steady returns, have valuable assets on their books, and are trading below what I think they are worth. Tesla may one day dominate robotaxis and humanoid helpers; the question is whether today’s price still grants a margin of safety to protect investors if those futures arrive late, or not at all.
Rule No. 1: Never lose money. Rule No. 2: Never forget Rule No. 1.
— Warren Buffett
Buffett’s rule explains my hesitation. If things work out for the company, there may be tremendous upside in Tesla stock. The oracles of investment with whom I most identify, however, prefer to limit their potential losses rather than take gambles with high odds. They prefer businesses that already deliver steady returns or have assets on the books, and that trade below what we think they are worth.
None of this is a grudge against Tesla. Counting downside risk first is a philosophical approach. Speculative leaps can generate windfalls, but they are also more likely to fail. Careful ownership feels slower, yet as Li Lu likes to say, it is “self-defence.”
For readers who want more from Wood, she contributed a chapter to Faith Driven Investing: Every Investment Has an Impact—What’s Yours? The volume encourages Christians to see their investments 'from God’s perspective' and learn to 'steward their investments for His kingdom.'
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