Cathie Wood, head of Ark Investment Management, expressed confidence in Nvidia’s AI assets, even though she reduced her stake in the company before the stock’s big rally last year. In a video interview from the Greenwich Economic Forum in Hong Kong, Wood highlighted Ark’s heavy investments in emerging AI companies.
Ark still holds Nvidia shares in its specialty portfolios and flagship fund, but Wood noted the firm first invested in Nvidia in 2014 when the stock was around $4 and held it until it reached about $400.
Most of Ark’s Nvidia shares were sold before last year’s surge, but the chipmaker at the center of the AI boom has seen its shares rise 15% since May 24 on the back of strong first-quarter sales and a promising second-quarter outlook.
Nvidia’s shares have soared more than eightfold since the second half of 2022, hitting about $1,224, giving it a market capitalization that surpasses Apple’s at $3 trillion. Explaining the decision to sell, Wood highlighted the potential benefits that Nvidia’s rise could bring to other companies.
Wood said the semiconductor industry’s growth isn’t over, but it will likely slow temporarily as companies shape their strategies around AI, noting that some companies that Arc had expected to benefit from AI, such as Salesforce, missed revenue expectations in their current fiscal year.
Wood called self-driving “the biggest AI project on the planet” and defended Ark’s Tesla investment, which Ark increased in the first quarter despite concerns about a slowing EV market and competition from Chinese rival BYD.
Wood remains optimistic, predicting Tesla will gain more market share as rivals such as General Motors Co. and Ford Motor Co. back away from EV plans amid concerns about profitability. Ark’s analysis predicts Tesla’s stock could reach $2,000 a share by 2027.
Additionally, Ark Venture Fund recently disclosed investments in Elon Musk’s AI startups xAI, OpenAI, and Anthropic.Wood, who has attracted attention during the pandemic for her bold tech predictions, credited the ARK Innovation ETF, which has fallen nearly 16% this year, with being buoyed by its 68% rally last year amid shifting interest rate expectations.She expects economic factors and the upcoming election to lead to significant interest rate cuts in the U.S. this year.
Also read: Binance Launches IO Launchpool for AI and Cloud Revolution
