Tesla (NASDAQ: TSLA) Battery Day didn’t have the flamboyant frills or dramatic music that different firm occasions have used prior to now, nevertheless it did have a clear-cut message: cell prices are reducing, and Tesla’s lead is increasing. The occasion gave ARK Make investments sufficient of a motive to load up on extra shares of the electrical automaker’s stock, and the corporate’s analysts are satisfied that different producers may have an excessive problem with Tesla’s dominance within the sector for years to come back.
After Battery Day concluded and the following buying and selling day started, ARK bought over 166,000 shares of Tesla stock, in accordance with an electronic mail that particulars its most up-to-date trades.
Surprisingly, TSLA stock dipped significantly after Battery Day based mostly on the truth that the corporate’s launched particulars about an improved cell manufacturing course of can be a long-term challenge and would seemingly take wherever from 1 to three years to take impact. Curiously, the corporate’s launch of a 4680 battery cell, which improves energy, vary, and price, was not sufficient to persuade Wall Street to spice up the stock’s price.
Wow, @ARKInvest simply added much more $TSLA. Their observe file in these “buy the dip” alternatives is impeccable. pic.twitter.com/xYIDVuMZYJ
— Matt Smith (@MatchasmMatt) September 23, 2020
Nonetheless, ARK, together with different monetary companies, noticed the dip as a chance to buy much more holdings than earlier than. Tesla’s new tech offers ARK the indication that no automotive corporations may have the prospect to catch up, just because they’re too far behind in battery and EV tech improvement.
Tasha Keeney of ARK appeared on Bloomberg to debate Tesla’s developments.
“Tesla is changing the way that the electric vehicle industry works,” Keeney mentioned. “For any traditional automaker to catch up to Tesla now, it seems almost impossible. This $25,000 car that will probably have even greater range than previous models, maybe 400 miles, let’s say. I mean, what are you going to do if you’re a traditional OEM, and you’re still struggling to get your electric vehicle program together?”
“It’s just going to be so hard to catch up to them at this point,” she added.
The proof is within the pudding, and ARK elevated their holdings considerably following the Battery Day bulletins. However the dip in price got here to Keeney’s shock.
“People are talking about the fact that the event lacked ‘sizzle.’ You know, that is something that I’m surprised to hear.”
Some don’t perceive the long-term implications of a extra environment friendly battery cell, together with the truth that Tesla is making the cell itself. Not solely will the cell be extra highly effective, however it’ll additionally considerably scale back prices, bringing the price of the corporate’s automobiles down.
As soon as the manufacturing of the brand new cells is elevated, the prices related to creating a battery will lower, and electrical automobiles shall be extensively out there as a result of they are going to be extra inexpensive to extra folks.
Battery Day didn’t have all of the bells and whistles, nevertheless it did have a message to OEMs and ICE producers: Your time is coming to an finish.
Disclaimer: Joey Klender is a TSLA shareholder.