Cathie Wood Goes Bargain Hunting: 3 Stocks She Just Bought

The well-known investment manager Cathie Wood made significant moves on Thursday. Her proactive approach to investing appears to be regaining traction, as she continues to actively manage the exchange-traded funds at Ark Invest. On this particular Thursday, Wood increased her holdings in three prominent companies.

1. Amazon

Wood is known for her strategy of purchasing stocks that dip in value but also isn’t hesitant to buy stocks that are performing well. In fact, Amazon's shares have risen by 13% since the company released strong financial results in late October. Ark Invest took the opportunity to bolster its investment in Amazon on Thursday.

Amazon, a leading online retailer, reported an 11% rise in net sales for the third quarter, meeting the upper end of its previous guidance. The company experienced a 9% increase in domestic sales, complemented by robust international growth as well as strong performance in its Amazon Web Services (AWS) cloud division. Most impressively, Amazon exceeded Wall Street profit expectations, with earnings per share climbing 52% to reach $1.43. This marks the fourth consecutive report where Amazon has outperformed profit targets by a significant margin.

Despite modest sales growth, Amazon’s widening margins are appealing to investors. In an economic environment marked by rising costs, the company successfully increased its profit margins, evidenced by a substantial surge in free cash flow for the quarter. This updated guidance for the holiday quarter predicts net sales growth between 7% to 11%, slightly lower than previous projections, but investors remain optimistic given the company’s recent success in meeting its upper sales targets.

2. MercadoLibre

On the same day, MercadoLibre’s shares suffered a 16% decline following disappointing financial results. While the revenue grew by 35% in U.S. dollars, its bottom line only increased by 11%, disappointing many investors who had high expectations for this Latin American e-commerce and fintech leader.

MercadoLibre’s e-commerce platform has contributed significantly to its success, but many believe its fintech solution, Mercado Pago, is just as important. The stock was trading close to its all-time high just before the earnings announcement, but Wood appears to view this drop as an opportunity for investment. Historically, MercadoLibre has shown a tendency to reward those who invest during such dips.

3. CRISPR Therapeutics

Cathie Wood has long been a supporter of gene editing technologies as viable solutions for genetic disorders. On Thursday, she decided to add more shares of CRISPR Therapeutics, just two days after the company announced mixed quarterly results. As one of the leaders in the gene-editing space, CRISPR is actively conducting clinical trials for various applications, including oncology and autoimmune disorders.

While the most recent financials showed a slight miss in revenue expectations, CRISPR’s loss was smaller than predicted, which is not concerning given its early-stage position in a long regulatory approval journey. Moreover, the company benefits from a robust cash supply, giving it the time needed to navigate through these early challenges. Some analysts did lower their price targets on CRISPR but currently hold neutral ratings, indicating they may refrain from investing until clearer paths to revenue and profitability are established. Nevertheless, Timely investments like Wood's could ultimately pay off in the long run.

investment, stocks, growth