Cathie Wood, the renowned CEO and co-founder of Ark Invest, surprised investors as she made a rare move by adding to six positions in her portfolios. Wood increased stakes in The Trade Desk, Spotify, and Archer Aviation on Tuesday, indicating her confidence in these companies’ growth prospects.
The Trade Desk, a leading player in the digital advertising industry, received a significant boost when William Blair initiated coverage of the stock. The investment firm highlighted the company’s potential to capitalize on the shift to digital advertising, as well as its strong growth prospects. The Trade Desk reported a 23% increase in revenue during the second quarter, and William Blair predicts a similar 23% growth for the full year, aligning with Wall Street’s consensus.
Another company that caught Wood’s attention was Spotify, the popular music streaming platform. Despite the stock already doubling in value this year, Wood sees further potential for growth. Spotify raised prices over the summer, a move that could potentially improve its profitability. However, the company faced a challenge in maintaining revenue growth, which only reached 11% despite a 27% increase in total monthly active users. The faster growth of ad-supported users compared to paying accounts could be a factor in this disparity.
Wood’s interest in Archer Aviation highlights her belief in the future of short-range air travel. Archer specializes in electric vertical takeoff and landing aircraft, positioning itself as an innovative player in the market. Although the company has not yet generated revenue and is expected to incur continued losses, its stock has tripled this year. Archer’s success can be attributed to securing financing, forming partnerships, and clearing regulatory hurdles, all of which indicate promising prospects for the company.
The Trade Desk, Spotify, and Archer Aviation share a common trait: all three are growth stocks that have outperformed the market. Wood’s decision to increase her positions in these companies further solidifies their status as winners in her eyes. As an influential figure in the investment world, when Wood makes a move, investors take note. The market will undoubtedly closely monitor the performance of these companies as they continue to thrive under Wood’s guidance.