Amidst a market deluge, Cathie Wood stands resilient, ready to seize the falling daggers in a financial downpour. The co-founder, CEO, and stock-picker at Ark Invest showcased remarkable tenacity on Monday, amidst plunging markets, as she augmented her positions across two dozen stocks, capitalizing on the attractive lower entry points presented. Will her shrewd strategy prove fruitful?
Wood jumpstarted the trading week by bolstering her positions in Amazon.com (NASDAQ: AMZN), Tesla Motors (NASDAQ: TSLA), and Tempus (NASDAQ: TEM). These shares witnessed a 2% to 4% decline on Monday, mirroring the broader market sell-off. Let’s delve into the specifics.
Amazon’s Rocky Road
Amazon, the e-commerce titan, witnessed a 4% decline on Monday, adding to the woes of shareholders. The past few weeks have been far from a joyride, with Amazon slipping 20% from its recent all-time high.
The major stumble occurred the prior Friday. Amazon’s stock plummeted by 9% after unveiling financial results that failed to impress the market. Despite earnings per share nearly doubling to $1.26 in the second quarter, trumping analyst forecasts of $1.03, the company fell short on revenue expectations.
Revenues inched up by 10% to $148 billion for the three months ending in June, slightly undershooting analyst estimates. The robust 19% growth in Amazon Web Services was offset by softer growth in North American e-commerce and the smaller international segment.
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Amazon’s growth trajectory appears challenged. The company is poised for its third consecutive year of sub-12% revenue growth, marking its weakest performance in its 27-year history. As competition intensifies, and economic headwinds loom, Amazon finds itself navigating turbulent waters ahead.
Tesla’s Turbulence
Tesla, a cornerstone within Wood’s portfolio, representing 14% of assets in the Ark Innovation ETF (NYSEMKT: ARKK), has witnessed a 20% decline this year, contributing to Ark Innovation’s recent underperformance compared to the market.
Challenges loom large for Tesla. With revenues growing by a mere 2% in the latest quarter, a notable decline in vehicle deliveries and lower average selling prices have dented overall profitability. While Tesla maintains its leadership position, it faces the daunting task of reevaluating growth models, especially amidst rising prices for its products and services.
Is Tesla an overpriced automaker or a tech gem waiting to be unearthed? Wood appears to lean towards the latter, evident in her recent purchase on Monday.
The Rollercoaster Ride of Tempus AI
Since going public in mid-June, Tempus AI’s stock has been a wild rollercoaster of market exuberance. With share prices oscillating between lows and highs, the stock currently hovers around its IPO price of $37.
Tempus AI, a pioneer in applying artificial intelligence in healthcare, remains resolute in its pursuit of using AI for intelligent diagnostics, with a substantial network of U.S. academic medical centers and oncologists. Fresh financials post-market closure on Tuesday promise to shed light on the company’s maiden public quarter.