Really been enjoying this Cathie Wood series so far, but also extremely well timed and highly relevant market in real time (I’ve said in many occasions that the RV team who books / sets the programming schedule are like the best market timing “predictors” of all time lol - and it’s very true).
Market Developments in the last 24-48 hours (as Cathie Wood series started):
•TSLA Q2 Earnings beat: EPS $1.45 vs $0.96 est. OP $1.3bn (3x YoY), overcoming the fundamental bear case hurdles. EV deliveries 201k vs 195k est, beating their own estimates even with China/supply chain issues. Gross margins 28.4%, which was +2pp QoQ, despite -$160mn less in gov regulatory credits QoQ ($354 in Q2 vs $514m Q1).
•China tech getting destroyed one new regulatory hit after another.
Takeaways: Cathie Wood, the noise blocker & risk manager
TSLA is ARKK largest holding at 10% allocation. Although she says in her interview that while they obviously watch every earnings quarter, they’re not QoQ focused- they’re looking YoY. And despite being well off highs, stock is still >2x YoY. The only time she sells TSLA is when it’s gone up too much and she needs to rebalance so that it doesnt become 40% of the fund. She has yet to dump TSLA as a core position, despite all the noise to do so.
That leads to people saying she’s just a bull market fund manager, no different from a Portnoy “stocks only go up.” And honestly, that might have been... (More)