Markets with Madison: Tesla bull Cathie Wood sees stock at US$1500

Welcome to the NZ Herald’s new online video business show, Markets with Madison, featuring investment analysis and insights. Starting today, the new twice-weekly show - hosted by senior multimedia business journalist Madison Reidy - will feature investment experts, including local and international fund managers, analysts, traders and company executives. Markets with Madison will be available to watch on nzherald.co.nz every Monday and Friday, bolstering our indepth business content. For feedback and tips, please email marketswithmadison@nzme.co.nz

Controversial US fund manager Cathie Wood expects Tesla’s share price to reach at least US$1500 by 2026, about eight times its current value, if its electric vehicles continue to grow in popularity.

Wood is the founder and chief investment officer of Ark Invest, a US investment firm that creates exchange-traded funds and mutual funds, with holdings in companies pursuing technological advances such as robotics, space exploration and cryptocurrency.

Speaking on Markets with Madison from New York, the Tesla bull said an economic downturn caused by higher interest rates would not impact the success of the innovative companies she invested clients’ funds in.

Tesla had its largest ever share price decline last year, losing 65 per cent of its value. This year the stock has rebounded, gaining 92 per cent.

Ark’s flagship fund, Ark Innovation, ticker name ARKK, made a -60 per cent return in 2022. This year its total return was positive at 27.8 per cent on January 31.

Wood’s purchasing of Tesla early this year made it Ark’s largest holding by February, from second in January. Other top ten holdings across all Ark funds included Zoom, Square, Coinbase and Shopify.

CEO and Chief Investment Officer of ARK Invest, Cathie Wood. Photo / Hugo Amaral, SOPA Images, LightRocket via Getty Images

Ark has a partnership with Japanese firm Nikko Asset Management, which operates in New Zealand and allows Kiwisaver and retail customers to invest in Ark funds.

NZ reporting season kicks off

The New Zealand company reporting season begins this week with Contact Energy, Fletcher Building, and SkyCity among the first to release their finances.

Shane Solly, Harbour Asset Management portfolio manager, told Markets with Madison investors should brace for negative outlooks and commentary from company leaders, with cost and job cutting announcements possible.

He said there had been an “absence of confessions” from listed companies ahead of releasing full or half year financial results throughout February and March, but higher interest rates and inflation would begin to bite bottom lines.

He said Harbour was avoiding investing client funds in cyclical companies in this environment.

Get investment analysis and insights from the experts on Markets with Madison every Monday and Friday on the NZ Herald.

Disclaimer: The information provided in this programme is of a general nature, and is not intended to be personalised financial advice. We encourage you to seek appropriate advice from a qualified professional to suit your individual circumstances.