Something old, something new.
Cathie Wood, chief executive of Ark Investment Management, bought a stock Ark hasn’t owned since 2021 and sold one of her old favorites Monday.
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Ark funds purchased 174,848 shares of Meta Platforms (META), the social media titan that owns Facebook. That stash was valued at $47.4 million as of Monday’s close.
Woods lauded the company’s artificial intelligence efforts several weeks ago. It also posted a strong earnings report for the first quarter. Meta stock has more than doubled so far this year and has climbed 55% over the past 12 months.
Meanwhile, Ark funds dumped 393,062 shares of electric vehicle colossus Tesla (TSLA), valued at $98.2 million as of Monday’s close.
The sale likely represents profit-taking, as Wood is a long-time evangelist for Tesla and its founder Elon Musk. The company remains far and away the biggest holding in her flagship Ark Innovation ETF (ARKK).
Wood's Price Target for Tesla
Wood has a five-year price target of $2,000 for the stock. It recently traded at $259. Tesla shares have soared 110% so far this year and have gained 12% over the past year. The company continues to benefit from the global transition to electric cars.
Ark funds also unloaded 20,111 of semiconductor king Nvidia (NVDA) Monday, valued at $7.9 million as of Monday’s close. That repeats trades Wood made last month. She said then that she was selling because Nvidia faces growing competition.
It has skyrocketed 177% year to date and 139% over the last year, thanks to strong earnings and optimism about its prospects with artificial intelligence.
Finally Monday, Ark Next Generation Internet ETF (ARKW) shed 82,081 shares of e-commerce host Shopify (SHOP), valued at $5.4 million as of Monday’s close.
The company’s stock has soared 38% since May 3, after it announced a sale of most of its logistics business and laid off 20% of its workforce. Shopify dumped the logistics stake to focus on its core e-commerce platform business.
Wood’s Lagging Returns
Meanwhile, Wood’s performance hasn’t exactly lit the investment world on fire over the past couple years, as her young technology stocks have slumped. Ark Innovation has descended 72% from its February 2021 peak.
Nonetheless, the fund has bounced back 42% so far this year, as tech stocks have rebounded in general. The tech-heavy Nasdaq Composite has risen 30%.
Mama Cathie, as Wood is known to her fans, defends her strategy by noting that she has a five-year investment horizon. But the five-year annualized return of $8.1 billion-asset Ark Innovation was negative 0.02% through June 12, compared with positive 11.18% for the S&P 500, according to Morningstar.
The fund’s performance also doesn’t come close to Wood’s goal for annualized returns of 15% over five-year periods.
Ark Innovation suffered a net investment outflow of $55 million during the five days through June 9, and $240 million over the last year, according to ETF research firm VettaFi.
