Tesla Inc (NASDAQ: TSLA) CEO Elon Musk has told its employees that he agrees with Cathie Wood-led ARK Innovation ETF (NYSEARCA: ARKK) that Tesla is worth $3,000 a share "if they execute really well".
What Happened: In a recent interview, Cathie Wood said that her base case on Tesla is $3,000 a share.
"Our estimate for Tesla's success has gone up. The main reason for that is their market share. So instead of going down from year-end 2017 to today, it has actually gone up fairly dramatically," Wood said.
However, Wood's price tag for Tesla looks outrageous. Tesla is currently trading at $733 a share, and it would have to go up above 300% to reach that price target.
Ark Invest believes that Tesla is going to deliver between 5 and 10 million vehicles as soon as 2025.
It also says Tesla will deliver a completely autonomous ride-hailing network, known as Tesla Network, that is going to bring in a lot of money with a high margin.
In an email to Tesla employee obtained by Electrek, Musk highlighted Ark's new $3,000 price target and added that he concurs with Ark's analysis. "If we execute really well, I agree with Ark Invest," Musk said.
A $3,000 share price would put Tesla's valuation at $3 trillion and make it the most valuable company in the world.
At present, the automaker is the most valuable automotive company globally at over $730 billion.
Why It Matters: Musk has often commented on Tesla's stock price. Last year when Tesla's stock was reaching a new high, Musk told his followers on Twitter, "Tesla stock price is too high...imo."
A Tesla investor sued Elon Musk and the company board, saying the CEO's "erratic" tweets violate a settlement with the U.S. Securities and Exchange Commission.
His comment resulted in a more than $13 billion loss in Tesla's market value.
Last month, Ark Invest shed less than half a percent of its position in Tesla as the shares of the electric vehicle company climbed. It sold a total of 8,100 shares, estimated to be worth about $5.76 million.
Wood's firm holds large bets in Tesla, which it predicts will hit the 3,000 mark at the end of 2025.
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