We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
ETFs to Watch as Tesla Sees Worst Weekly Slump Post Q2 Earnings Miss
Read MoreHide Full Article
Key Takeaways
Tesla shares fell 18% last week after mixed Q2 results, despite record deliveries and a revenue beat.
TSLA missed earnings estimates, while FSD adoption and Cybercab production advanced in the quarter.
ETFs like WATS hold notable Tesla weightings, offering diversified exposure to the stock.
Shares of electric vehicle (EV) giant Tesla (TSLA - Free Report) have plunged nearly 18% over the past week, marking their worst weekly slump since 2022 and continuing the trend seen over the past several quarters. This follows the stock’s slip of nearly 4% in extended trading on July 22 (as cited in CNBC), after the company reported mixed second-quarter results.
Tesla failed to meet Wall Street expectations for its earnings but managed to comfortably beat its revenue estimates.
Impressively, the company achieved record deliveries globally in the second quarter, with sequential growth witnessed across all its geographical regions. It ended the quarter with its largest order backlog since 2023.
Such robust backlog figures strengthen revenue growth visibility for product-oriented giants like Tesla, and the recent share pullback may tempt dip-buyers. However, investor caution remains warranted. As Tesla shifts its core narrative from volume EV sales to autonomous tech and humanoid robotics, its primary revenue engine still faces pressure. With Robotaxis yet to reach commercial mass scale, deteriorating gross margins and declining average selling prices (ASPs) may keep more conservative investors on the sidelines for now.
Against this backdrop, a risk-averse investor may prefer to avoid direct single-stock exposure and instead consider exchange-traded funds (ETFs) with significant weightings in Tesla. By holding a diversified basket of industry leaders alongside Tesla, these funds help mitigate the idiosyncratic risks tied to a single company’s strategic pivot, spreading exposure across broader sectors.
Before highlighting such ETFs, it would be helpful to assess Tesla’s second-quarter performance across key metrics.
A Brief Analysis of TSLA’s Q2 Results
Tesla reported second-quarter 2026 earnings per share of 33 cents, which missed the Zacks Consensus Estimate by 34%. Its total revenues of $28.24 billion, however, surpassed the Zacks Consensus Estimate by 9.4%.
The company achieved record second-quarter vehicle deliveries, which improved 25% on a year-over-year basis. It is imperative to mention in this context that a large portion of Tesla’s vehicle demand has been backed by increased adoption of full-self driving (FSD) features in its cars.
About 55% of new vehicle deliveries in North America included enabled FSD subscriptions at purchase, while global active FSD users reached a record 1.48 million for TSLA during the second quarter.
As far as its Robotaxi business is concerned, Tesla started production of Cybercab, its purpose-built autonomous EV, in the second quarter. Engineering test drives of production Cybercabs on public roads have also begun during the quarter.
In its energy storage business, Tesla deployed 13.5 gigawatt-hours of energy storage, which reflected the second largest quarter for this business. However, gross margin for this business suffered a contraction of 1,910 basis points (bps), owing to legacy warranty expenses, disappearing tariff perks, and price pressure from rising industrial competition.
The company’s free cash flow turned negative in the second quarter after its capital spending more than doubled from the prior period. With Tesla’s management guiding capex to exceed $25 billion this year, with more to come over the next two to three years, one can expect the stock to continue to witness such cash burns in the near term.
Looking ahead, the company remains on track to begin production of Megapack 3 and Megablock battery systems this year at its new Megafactory Texas.
Tesla also remains actively focused on increasing production of its 4680 cells to support production ramps for both the Cybertruck and the Tesla Semi, as well as increased Model Y production. Meanwhile, first-generation production lines for Optimus are also expected to start in 2026.
Tesla-Heavy ETFs to Watch
Corgi Battery Energy Storage Systems ETF (WATS - Free Report)
This fund, with net asset value of $19.59 as of July 24, 2026, offers exposure to 25 companies across the battery storage value chain, ranging from the cell manufacturers and power electronics providers building against record deployment demand to the energy management software, grid services platforms, and project developers scaling storage from rooftops to utility-scale installations. Tesla holds the first position in this ETF, with 15.07% weightage.
This fund, with a net asset value of $35.11 per share as of July 24, 2026, offers exposure to 15-25 securities that trade on U.S. exchanges, with a goal of outperforming the S&P 500 Total Return Index over a rolling five-year period. Tesla holds the first position in this fund, with 10.8% weightage.
This fund, with a net asset value of $114.04 per share as of July 24, 2026, this fund provides exposure to companies that substantially benefit from the development of new products or services, technological improvements, and advancements in scientific research related to, among other things, energy, automation and manufacturing, materials, artificial intelligence, and transportation. Tesla holds the first position in this fund, with 9.63% weightage.
This fund, with a net asset value of $48.93 per share as of July 23, 2026, offers exposure to the seven largest NASDAQ-listed companies. Tesla holds the seventh position in this fund, with 9.21% weightage.
View the Zacks #1 Rank List
Image: Bigstock
ETFs to Watch as Tesla Sees Worst Weekly Slump Post Q2 Earnings Miss
Key Takeaways
Shares of electric vehicle (EV) giant Tesla (TSLA - Free Report) have plunged nearly 18% over the past week, marking their worst weekly slump since 2022 and continuing the trend seen over the past several quarters. This follows the stock’s slip of nearly 4% in extended trading on July 22 (as cited in CNBC), after the company reported mixed second-quarter results.
Tesla failed to meet Wall Street expectations for its earnings but managed to comfortably beat its revenue estimates.
Impressively, the company achieved record deliveries globally in the second quarter, with sequential growth witnessed across all its geographical regions. It ended the quarter with its largest order backlog since 2023.
Such robust backlog figures strengthen revenue growth visibility for product-oriented giants like Tesla, and the recent share pullback may tempt dip-buyers. However, investor caution remains warranted. As Tesla shifts its core narrative from volume EV sales to autonomous tech and humanoid robotics, its primary revenue engine still faces pressure. With Robotaxis yet to reach commercial mass scale, deteriorating gross margins and declining average selling prices (ASPs) may keep more conservative investors on the sidelines for now.
Against this backdrop, a risk-averse investor may prefer to avoid direct single-stock exposure and instead consider exchange-traded funds (ETFs) with significant weightings in Tesla. By holding a diversified basket of industry leaders alongside Tesla, these funds help mitigate the idiosyncratic risks tied to a single company’s strategic pivot, spreading exposure across broader sectors.
Before highlighting such ETFs, it would be helpful to assess Tesla’s second-quarter performance across key metrics.
A Brief Analysis of TSLA’s Q2 Results
Tesla reported second-quarter 2026 earnings per share of 33 cents, which missed the Zacks Consensus Estimate by 34%. Its total revenues of $28.24 billion, however, surpassed the Zacks Consensus Estimate by 9.4%.
The company achieved record second-quarter vehicle deliveries, which improved 25% on a year-over-year basis. It is imperative to mention in this context that a large portion of Tesla’s vehicle demand has been backed by increased adoption of full-self driving (FSD) features in its cars.
About 55% of new vehicle deliveries in North America included enabled FSD subscriptions at purchase, while global active FSD users reached a record 1.48 million for TSLA during the second quarter.
As far as its Robotaxi business is concerned, Tesla started production of Cybercab, its purpose-built autonomous EV, in the second quarter. Engineering test drives of production Cybercabs on public roads have also begun during the quarter.
In its energy storage business, Tesla deployed 13.5 gigawatt-hours of energy storage, which reflected the second largest quarter for this business. However, gross margin for this business suffered a contraction of 1,910 basis points (bps), owing to legacy warranty expenses, disappearing tariff perks, and price pressure from rising industrial competition.
The company’s free cash flow turned negative in the second quarter after its capital spending more than doubled from the prior period. With Tesla’s management guiding capex to exceed $25 billion this year, with more to come over the next two to three years, one can expect the stock to continue to witness such cash burns in the near term.
Looking ahead, the company remains on track to begin production of Megapack 3 and Megablock battery systems this year at its new Megafactory Texas.
Tesla also remains actively focused on increasing production of its 4680 cells to support production ramps for both the Cybertruck and the Tesla Semi, as well as increased Model Y production. Meanwhile, first-generation production lines for Optimus are also expected to start in 2026.
Tesla-Heavy ETFs to Watch
Corgi Battery Energy Storage Systems ETF (WATS - Free Report)
This fund, with net asset value of $19.59 as of July 24, 2026, offers exposure to 25 companies across the battery storage value chain, ranging from the cell manufacturers and power electronics providers building against record deployment demand to the energy management software, grid services platforms, and project developers scaling storage from rooftops to utility-scale installations. Tesla holds the first position in this ETF, with 15.07% weightage.
It charges 35 bps as fees.
The Nightview Fund (NITE - Free Report)
This fund, with a net asset value of $35.11 per share as of July 24, 2026, offers exposure to 15-25 securities that trade on U.S. exchanges, with a goal of outperforming the S&P 500 Total Return Index over a rolling five-year period. Tesla holds the first position in this fund, with 10.8% weightage.
It charges 125 bps as fees.
ARK Autonomous Technology & Robotics ETF (ARKQ - Free Report)
This fund, with a net asset value of $114.04 per share as of July 24, 2026, this fund provides exposure to companies that substantially benefit from the development of new products or services, technological improvements, and advancements in scientific research related to, among other things, energy, automation and manufacturing, materials, artificial intelligence, and transportation. Tesla holds the first position in this fund, with 9.63% weightage.
It charges 75 bps as fees.
Direxion Daily Magnificent 7 Bull 2X Shares (QQQU - Free Report)
This fund, with a net asset value of $48.93 per share as of July 23, 2026, offers exposure to the seven largest NASDAQ-listed companies. Tesla holds the seventh position in this fund, with 9.21% weightage.
It charges 98 bps as fees.