Cathie Wood Reduced Her Stake in Tesla: Is TSLA Stock a Buy, Hold, or Sell Now?

Group 1: Cathie Wood's Actions - Cathie Wood sold 23,110 shares of Tesla through ARK Invest's ARK Innovation ETF, generating approximately $11.2 million [2] - The sale was a partial profit-taking move, with ARK still holding a significant 11.9% weight in Tesla [2] - Tesla stock is up 18% year-to-date, slightly outperforming the broader market despite the sale [2] Group 2: Tesla's Recent Performance - Tesla's stock has been volatile, surging to new highs after Q3 earnings due to optimism around full self-driving, robotaxis, AI chips, and humanoid robots [3] - Revenue for Q3 rose about 12% year-over-year to approximately $28.1 billion, while vehicle deliveries increased 7.4% to just over 497,000 units [5] - Adjusted earnings per share fell 31% year-over-year, and gross margin declined to 18% due to price cuts impacting results [5] Group 3: Strategic Focus and Challenges - Tesla is positioning itself as an AI platform rather than just a carmaker, with plans to expand robotaxi operations and develop the Optimus humanoid robot [4] - Despite enthusiasm for Tesla's AI roadmap, challenges remain in its core business, particularly from low-cost Chinese EV manufacturers [5] - Tesla generated substantial free cash flow of $4 billion in Q3 and maintains a large cash balance of $41 billion for aggressive expansion [5]