Cathie Wood and her Ark Invest company on Tuesday Tesla (TSLA) shares to invest in emerging drone manufacturer Archer Aviation (ACHR). Tesla shares rose early Wednesday morning, sending ACHR shares soaring as well.
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Cathie Wood’s ARKK Stock Selection Strategy Explained
Wood and Ark Invest sold 62,867 Tesla shares on Tuesday, worth $14.538 million, at a closing price of $231.26, according to the company’s daily trading update. Wood sold more than 56,000 shares from the ARK Innovation ETF (ARKK) and the rest from the ARK Next Generation Internet ETF (ARKW).
Tesla shares surged 10.2% on Tuesday after Elon Musk’s electric vehicle company reported better-than-expected second-quarter deliveries despite a 4% drop in deliveries compared to last year.
Looking up at the sky
Meanwhile, Wood and ARK bought 406,912 Archer Aviation shares for $1.51 million on Tuesday, based on the closing price of 3.72.
San Jose-based Archer is developing electric vertical take-off and landing aircraft (eVTOL) for urban environments with the goal of building a robust aerial taxi service.
Archer Aviation announced on Tuesday Stellantis Stellantis has entered into a strategic funding agreement with Archer, Inc. (STLA), to invest $110 million in Archer in 2023 through a series of open market share purchases and investments through the strategic agreement. The investment comes after Archer completed a critical test flight of its Midnight aircraft on June 8.
The company announced on June 5 that it had received FAA approval to begin commercial airline operations, and on June 17, it reached an agreement with Signature Aviation, giving it access to the world’s largest network of commercial air terminals. Under the agreement, Archer will begin air taxi services. United Airlines Archer Airlines will also establish UAL hubs at Newark International Airport and Chicago O’Hare Airport in late 2025. The deal also gives Archer Airlines access to airfields in New York, Los Angeles, San Francisco and Texas.
Signature Aviation operates more than 200 private terminals around the world, and the company said Archer plans to expand its network as aircraft availability increases.
Following its June 20 announcement, Archer revealed plans to build an air mobility network in five locations in the San Francisco Bay Area.
Wood and Ark also added 3,788 shares on Tuesday. Blade Air Mobility (BLDE) is another company working to build an urban air mobility network. BLADE offers a combination of helicopters and charter jets, rather than eVTOLs, but the company says it is preparing to introduce electric vehicles.
Other eVTOL drone manufacturers include: Eve Air Mobility EVEX, a spin-off from a Brazilian jet aircraft manufacturer Embraer (ERJ). And China-based EHang Holdings (EH) is developing an unmanned aerial taxi service.
Tesla Stock and ACHR Actions
Tesla shares rose more than 3.2% on Wednesday morning. TSLA shares are on track to post their seventh consecutive day of gains if the early gains hold.
Tesla shares were down 6.9% in 2024 through Tuesday.
Archer shares surged 6.2% early Wednesday morning. On Tuesday, Archer shares rose 8.8%, rebounding above their 50-day moving average.
But ACHR shares had fallen 39.4% this year through Tuesday’s close.
BLDE shares were up slightly on Wednesday after rising 2.7% on Tuesday. BLADE shares have fallen 3.9% this year.
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