IMPORTANT POINTS:
- Cathie Wood is known on Wall Street for researching and fully trusting the stocks she buys, regardless of whether these companies are going through a bad time.
- Its main innovation fund ARKK (ARKK) is having a great time after experiencing heavy losses last year.
- The two companies he trusts despite their difficult times are: Recursion Pharmaceuticals and Roblox.
Cathie Wood‘s main innovation fund, ARKK, is up more than 46% so far this year after suffering significant losses in 2021 and 2022.
The investor is recognized on Wall Street for having a lot of trust in the companies she bets on, even if they are not going through a good time.
For example, while your fund vastly outperforms the market, there are stocks that make up the ETF that have mediocre returns.
However, far from selling, Cathie Wood has increased her positions in two companies that have “disappointed” the market to some extent. To continue; the details.
Recursion Pharmaceuticals (RXRX)
It is a biotechnology company that leverages cutting-edge artificial intelligence and machine learning technologies to accelerate the drug discovery and development process.
The company currently has a few drugs in clinical testing and there is one that stands out from the rest as it seeks to treat cerebral cavernous malformation (CCM). It is expected that next year, if all goes well, phase 2 will begin.
In July, shares reached a high of $15, before plummeting to $8 today.
Still, Wood didn’t stop buying shares. In the last three months, he acquired almost 2 million securities totaling 6.19 million, which have a price of more than 50 million dollars.
In addition, the stock is backed by other Wall Street analysts, with a price target in some cases of $35, representing a potential gain of 318%.
The average price target of analysts covering the stock is $16.8, more than double what it is currently trading at.
Roblox (RBLX)
This company founded in 2006 is dedicated to developing online gaming platforms and is one of Cathie Wood’s big bets. Especially because of the projections on the metaverse.
It is that millions of users use Roblox to create and design their own universes to play with each other in a totally virtual world.
However, recent data released by the company indicated losses in revenue and profits. Additionally, daily active users increased 25% year over year to 65 million, below expectations.
This caused the shares to accumulate a fall of more than 32% in the last three months.
The negative numbers didn’t scare Wood, who still bought 1.1 million shares in the last 60 days to expand his stake to 9.2 million shares with an approximate market value of $263 million.
On Wall Street, Roblox has a “Moderate Buy” consensus with a price target of nearly $39 for the next 12 months.
On Wednesday, the shares tumbled 7.5% to $27, posting a 5.1% loss so far this year.
