Cathie Wood trims $11.2 million in longtime favorite stock
Tesla (TSLA) stock has been performing exceptionally well lately.
Shares have surged nearly 50% over the past six months, driven by optimism surrounding autonomous driving, AI, and the EV giant’s long-term growth prospects.
For most, the rally is a confirmation that the worst might be over, despite the sluggishness in the company’s underlying business.
That’s exactly what makes Cathie Wood’s latest move stand out.
Even with Tesla’s climb, the ARK Invest boss trimmed positions, selling roughly $11.2 million worth of shares in a single day (Dec. 18).
Naturally, with Tesla being a longtime favorite for Wood, it’s the kind of decision that sparks instant speculation.
However, selling doesn’t necessarily point to surrender.
It also reflects discipline, valuation-related troubles, or simple portfolio management following a superb run-up.
Also, Wood isn’t the only one at a crossroads.
Wall Street’s view of Tesla stock is largely divided, with optimism over AI pitted against concerns over margins, execution, and how much the good news has already been priced in.
Wood’s ARK Invest sold off 23,110 shares of Tesla, valued at nearly $11.2 million on Dec. 18.
The move fits a pattern that has become clear over the past two to three months.
ARK’s approach appears to be more akin to position sizing and profit-taking following a massive rally, rather than a change in long-term conviction. Tesla remains ARK’s largest holding, even with multiple cuts over the past few months.
More Tesla:
The selling has shown up in distinct waves:
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Q2 2025 (filed July 30): ARK disclosed 3,077,464 TSLA shares, down 181,294 from Q1.
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Dec. 12, 2025: ARK sold 87,993 shares, valued at roughly $39.3 million.
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Dec. 15, 2025: Another 124,867 shares were sold, worth nearly $57.3 million.
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Smaller trims on Nov. 7 (71,638 shares) and Nov. 26 (27,102 shares) reinforce the same message.
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Tesla: 10.09%
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Shopify: 4.61%
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Roku, Inc.: 4.57%
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Coinbase: 4.27%
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Palantir Technologies: 3.98%
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CRISPR Therapeutics: 3.88%
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Robinhood: 3.71%
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Advanced Micro Devices: 3.49%
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Tempus: 3.41%
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Teradyne: 2.94%
Source: Cathiesark.com
Tesla has been riding the renewed wave of optimism surrounding autonomy and AI, but a sizeable chunk of Wall Street has become a lot more valuation-sensitive.
A lot of it is about timing and how much of the non-auto upside investors are already paying for at this point.
Morgan Stanley analyst Andrew Percoco summed that shift up perfectly, warning that most non-auto catalysts appear priced in at this point.
Related: Morgan Stanley sets jaw-dropping Micron price target after event
According to Seeking Alpha, Tesla stock trades at more than 375 times forward earnings (GAAP), which is 1,777% higher than the sector median.
Additionally, Goldman Sachs has maintained a neutral stance, keeping its price target on Tesla stock comfortably below its current price.
Barclays also maintained an equal weight stance, signaling that the narrative alone might be tough to justify a higher multiple.
For perspective, Tesla closed Friday, Dec. 19, at $481.20 a share, down 0.45% on the day.
Where cautious targets stand:
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Morgan Stanley: Equal weight, $425
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Truist: Hold, $444 (raised from $406)
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Goldman Sachs: Neutral, $400
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Barclays: Equal weight, $350
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Wells Fargo: Underweight, $120
Tesla’s roughly at 10% of Wood’s combined ARK portfolio, according to Cathiesark.com, but remains an anchor. Historically, though, it has been even bigger.
Tesla’s weighting in ARK’s flagship ARK Innovation ETF (ARKK) reached a peak of 15.4% back in July 2024, following a stellar run-up in value, Bloomberg reported.
Wood has consistently framed the business as more than “just an automaker,” saying it’s more like a platform operating at the intersection of a variety of megatrends (including robots, energy storage, and AI).
Related: Top-rated analyst drops curt 8-word take on Tesla stock
Over the years, Wood has demonstrated a willingness to rebalance around sizing and choppiness in a particular stock while maintaining her long-term view.
Wood remains mighty aggressive on autonomy with Tesla stock.
In a Bloomberg interview cited by Business Insider, she said that Tesla’s Robotaxi business may “account for 90% of the value of the company in five years.”
Moreover, even with rivals such as BYD pressuring EV market share, Wood remains steadfast in her defense of Tesla’s core product edge.
Related: Elon Musk just won back his $56 billion Tesla pay package
This story was originally published by TheStreet on Dec 20, 2025, where it first appeared in the Investing section. Add TheStreet as a Preferred Source by clicking here.