Veteran investor Cathie Wood is enthusiastic about tech tycoon Elon Musk‘s SpaceX making Wall Street debut, and is extremely bullish about its demand.
In a Bloomberg podcast published on May 6, she said seeds planted two decades ago are now flourishing.
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Tesla will have lowest cost structure, Wood predicts
A lot of technologies at Musk’s companies are evolving and converging, Wood argued. Musk believes in a vertically integrated company model for the new world and this is exactly what’s happening, she added.
In the robotaxi market, Tesla (Nasdaq: TSLA) is vertically integrated and has created the platform for other companies to build upon—something her fund ARK Invest has been focused on from its debut, Wood emphasized.
Vertical integration translates to the lowest cost structure for Tesla; in fact, the transportation cost is going to collapse as per ARK estimates, she claimed.
The cost structure of Alphabet’s Waymo is going to be 50% higher than that of Tesla by 2030 as per ARK estimates, she added. It’s because Waymo depends on other car manufacturers and Tesla has its own supply, she explained.
ARK Invest regularly trades Tesla shares through its funds. When the auto and EV company reported its quarterly earnings last month, its Bitcoin holdings turned out to be intact at 11,509 coins.
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‘Voracious’ appetite for ‘volatile’ SpaceX IPO
Musk’s aerospace and artificial intelligence (AI) company SpaceX is looking to sell $75 billion of stock in an initial public offering (IPO), valuing the firm at a valuation of $1.75 trillion. Wood expressed high hopes for the IPO.
“There is so much demand out there.”
In fact, SpaceX holds the largest position in ARK Venture Fund (Nasdaq: ARKVX), she highlighted. As of Apr. 30, SpaceX accounted for 13.76% of the fund.
Wood said investors looking for SpaceX exposure found her fund.
“So, the demand is voracious out there,” she added. “Only $75 billion… yes, it’s a big IPO, but just think about how SpaceX has reawakened the dream of space exploration.”
In the beginning, there will be a supply-demand imbalance and it will be a “volatile” IPO, she predicted.
The deployment of orbital data centers (ODCs) could drive Tesla’s revenue higher by 10-20 times relative to ARK’s current estimate, she added. She also dismissed the excitement around the technology being a hype and touted it as a real change-maker in the data infrastructure technology.
