Love her or hate her, there’s no denying that Cathie Wood is an influential investor. The founder and CEO of investment management firm ARK Invest continues to infuriate and inspire people with her take on the markets and her investment picks. Wood famously focuses the investments in her exchange-traded funds (ETFs) on stocks of companies engaged in disruptive technologies.
This is especially true of Wood’s flagship fund, the Ark Innovation ETF (NYSEARCA:ARKK). This ETF is comprised of stocks that are either hot or cold and prone to volatile trading. This has led to a good deal of volatility in the ARKK fund itself. Year-to-date, the flagship ETF is down 12% even as the three major U.S. indices are at record highs. Yet Wood remains undaunted and is sticking with her belief in companies offering new technologies.
If you can only buy one Cathie Wood stock in May, it better be one of these three names.
Coinbase Global (COIN)
The U.S. Securities and Exchange Commission (SEC) just greenlit spot Ethereum (ETH-USD) exchange-traded funds (ETFs). That decision sent the stock of Coinbase Global (NASDAQ:COIN) up 9% on the day it was announced. As with the spot Bitcoin (BTC-USD) ETFs approved in January of this year, the Ethereum funds should provide a further boost to Coinbase, which is the largest cryptocurrency exchange in the U.S.
Inflows to the spot Bitcoin ETFs were largely responsible for Coinbase reporting blockbuster first-quarter financial results that included a surge in profits. The crypto exchange reported EPS of $4.40, which was 303% higher than the $1.09 expected among analysts. Revenue in Q1 totaled $1.64 billion versus $1.34 billion that was expected on Wall Street.
A year earlier, Coinbase reported a loss of $78.9 million, or 34 cents a share. COIN stock is up 318% in the last 12 months. That’s very good news for Cathie Wood as Coinbase is the second largest position in her flagship ARK Innovation ETF.
Robinhood Markets (HOOD)
Crypto trading is also pushing the earnings and share price of Robinhood Markets (NASDAQ:HOOD) higher. The online brokerage is also benefitting from the fact that the stock market is at an all-time high and investors are feeling positive. The strength of both crypto and equity trading led Robinhood to post record Q1 financial results. The company announced Q1 EPS of 18 cents on record revenue of $618 million.
The results beat Wall Street forecasts that had called for earnings of 6 cents a share and revenue of $553 million. A year earlier, Robinhood reported a loss of 57 cents per share on revenue of $441 million. The company attributed the latest results largely to a rise in crypto trading on its platform. Cryptocurrency transaction revenue more than tripled in Q1 from a year earlier, said the company.
Robinhood also said that its assets under custody increased 65% year over year to $129.60 billion due to higher stock and crypto valuations. The company reported net deposits of $11.20 billion for the quarter and $23.90 billion for the last year. HOOD stock has risen 139% in the past 12 months, including a 66% gain so far in 2024. Robinhood Markets is Cathie Wood’s eighth largest position in the ARKK fund.
Meta Platforms (META)
It’s not one of Cathie Wood’s largest holdings, but it’s certainly one of her best. Meta Platforms (NASDAQ:META) is the 19th largest holding in the Ark Innovation ETF. But the social media and artificial intelligence (AI) giant is one of the best-performing tech stocks around. Over the last year, META stock has risen 89%. This year the shares are up nearly 40% despite some big volatility after the company’s Q1 print.
Meta’s most recent earnings report was quite strong, but the stock got knocked lower on concerns about increased spending on new ventures and technologies. Investors shouldn’t worry though as the long-term story around Meta Platforms remains intact. Plus, the company declared its first ever dividend earlier this year, paying stockholders 50 cents a share each quarter.
On the date of publication, Joel Baglole did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
