Cathie Wood Never Sold Ark's Core Stake in Tesla Despite the Stock Trailing Every Other Magnificent Seven Name in 2026. Here's Why Her Multi-Year Conviction Hasn't Wavered.

It has been a roller-coaster ride for Tesla (NASDAQ: TSLA) stock in recent years. In 2021, the stock reached a high of roughly $400 per share, only to collapse to nearly $100 per share in 2023. The stock then surged above $400 in 2025, only to collapse once again below $250 that same year.

After yet another surge and correction, Tesla stock currently hovers around $350 per share, resulting in a $1.1 trillion market cap. Through it all, Cathie Wood's firm, Ark Invest, never sold out of its Tesla stake. The position has been trimmed and added to many times over the years. But the firm has always remained a strong Tesla bull.

With a position valued at $1 billion, Tesla remains one of Ark Invest's largest holdings across all its funds. It's no wonder. Ark Invest currently has a long-term price target of $4,600 per share for Tesla stock. That's a sizable increase from its earlier price target of just $3,000 per share. In either case, Ark Invest is adamant that Tesla can deliver 1,000% gains for patient shareholders.

Ark Invest's Cathie Wood. Image source: Getty Images.

Why does Cathie Wood still believe in Tesla? It all likely comes down to one key catalyst.

This is why Cathie Wood still loves Tesla stock

Wood's firm no longer views Tesla as a simple EV (electric vehicle) stock. Instead, she believes the company will soon be a robotaxi juggernaut. With unmatched vertical integration, Tesla is positioned to scale its robotaxi fleet rapidly, at a lower cost than most competitors. The company's aggressive investments in artificial intelligence and self-driving technology, meanwhile, grant it the opportunity to convert its existing manufacturing capacity to robotaxi production while minimizing reliance on outside vendors.

"One of the biggest potential markets that we see in AI is autonomous driving and we think that all vehicles in the future, all passenger cars will be electric," a report from Ark Invest concludes. "We think $8 trillion to $10 trillion for the entire autonomous taxi opportunity throughout the world, from almost nothing," is possible, Wood adds. "That's how quickly AI is going to cause these things to happen."

The robotaxi opportunity alone accounts for 90% of Ark Invest's long-term price prediction for Tesla. In short, the firm is all-in on Tesla's robotaxi ambitions.

Image source: Getty Images.

Should you consider Tesla stock?

Should you follow Wood's lead and invest in Tesla stock? There are two important factors to keep in mind.

First, Wood's optimism for Tesla's robotaxi competitiveness is well-founded. Tesla's existing manufacturing scale and vertical integration should provide a structural near-term cost advantage. Tesla is targeting production costs between $20,000 and $30,000 for its Cybercab. Goldman Sachs estimates up-front costs between $50,000 and $100,000 for Tesla's competition, potentially granting the company a $0.05-$0.30-per-mile cost advantage.

Second, the timeline for robotaxi growth will be longer than most analysts, including Wood, suggest. Ark Invest has already needed to push out its growth timelines for Tesla's robotaxi business, as well as its ambitious price targets. A survey of experts conducted by McKinsey & Co. previously predicted that robotaxis would be available at scale by 2029. A recent update pushed that projection out to 2030.

Tesla's robotaxi opportunity is real. And Cathie Wood has plenty of reasons to get excited. But investors should be prepared for a multi-year holding period with plenty of volatility along the way.

Ryan Vanzo has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Tesla. The Motley Fool has a disclosure policy.