Cathie Wood Says Ark Is Well Placed in AI After Nvidia Trim

(Bloomberg) — Cathie Wood said Ark Investment Management is well positioned in artificial intelligence assets, even after her company trimmed its shares of Nvidia Corp. before last year’s rally.

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Wood said his private fund was “very exposed to new entrants” during a video interview at the Greenwich Economic Forum in Hong Kong on Thursday. She added that her company still holds Nvidia in more specialized portfolios and in the flagship fund.

The Wall Street financial manager, known for her high-profile calls for disruptive technologies, said she bought shares of Nvidia in 2014, when the stock was trading at around $4 on a share-adjusted basis. actions. The flagship ARK Innovation ETF held the stock until it hit around $400.

She sold most of her position ahead of the company’s rally last year. The chipmaker, at the center of the AI ​​boom, has seen its stock price rise 15% since May 24, when its first-quarter sales beat analysts’ estimates and its second-quarter forecast fell short. also exceeded projections. Its stock price has more than quadrupled since the end of 2022 to around $1,224. Its market value has reached $3 trillion, surpassing Apple Inc.

“We figured if Nvidia was going to continue doing this, the only reason it should be worth doing is because it would benefit a lot of other companies, and we started looking at what those other companies could be.” , said Bois. “We moved away and I guess it was a bit of a statement.”

While she doesn’t think the semiconductor industry is finished, there is pause as companies evaluate their strategic approach to AI. Some other companies that Ark said expected AI-driven revenue growth this earnings season failed to do so, she added, citing Salesforce Inc. as an example the most notable.

Meanwhile, Wood said autonomous driving is the “biggest AI project in the world”, defending his bet on Tesla Inc.

Ark added to its position in Tesla again in the first quarter, when sentiment cooled on the stock amid concerns about a slowdown in electric vehicle consumption. Threats to its leadership position from cheaper models from Chinese rival BYD Co. also weighed on shares. However, Wood said Tesla is poised to capture more market share, as peers like General Motors Co. and Ford Motor Co. pull back from electric vehicle projects due to profitability concerns.

In a 2023 analysis, Ark estimated that Tesla would reach $2,000 per share in 2027, with bull and bear scenarios of $2,500 and $1,400 per share, respectively.

In late May, the Ark Venture Fund also disclosed a stake in Elon Musk’s artificial intelligence startup xAI, representing approximately 2% of its holdings. This came a month after he revealed a position in OpenAI, representing around 4% of his holdings. It also has a stake in Anthropic.

Wood became famous at the height of the pandemic for her bold calls on pandemic darlings like Tesla, Zoom Video Communications Inc. and Roku Inc. Retail traders adopted some of her views, pushing funds higher than $60…

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