Cathie Wood goes on a bargain hunt: 3 stocks she just bought

ARK Invest CEO Cathie Wood turned heads last year after the fund manager’s outstanding performance in exchange traded funds. This year has turned out to be a little more difficult, but the volatility of some of his favorite names creates buying opportunities.

What is Wood buying these days? Well she added to her positions in DraftKings (NASDAQ: DKNG), Zillow Group (NASDAQ: Z), and Etsy (NASDAQ: ETSY) Tuesday. Let’s take a closer look at the shopping list.

Image source: Getty Images.

DraftKings

We love sports and we tend to overestimate our ability to predict game outcomes and individual performance. DraftKings is establishing itself as a leader in fantasy sports and now traditional betting.

Growth has been stellar here. Revenue climbed 320% in the second quarter of last week, accelerating from 253% year-on-year revenue for the first quarter. Monthly single payers on the DraftKings platform have climbed 281% over the past year, and it continues to make new deals with networks, leagues and individual teams to make sure the brand is alive and well. seen in the world of sport.

Despite DraftKings’ growth and dominance, the stock is still trading 30% below its spring highs. With DraftKings upping its forecast last week and making another smart acquisition earlier this week, you can’t fault Wood for placing more chips on his DraftKings bet.

Zillow Group

The real estate market is booming and the Zillow Group recorded a 70% year-over-year increase in revenue in last week’s second quarter report. A return to its Zillow home-based offerings platform played a big part in the recovery, but the 70% growth there was accompanied by a 70% increase for the rest of the business.

Zillow has never been so popular, with 229 million unique monthly visitors across all of its platforms. Zillow Offers continues to lose money, but its flagship business – the internet, media and tech segment – does more than bail out the home-rollover initiative.

While buying DraftKings at 30% off seems like a deal, the Zillow Group is still trading for less than half of its all-time high. Wood knows how to spot a good deal.

Etsy

A third stock Wood added on Tuesday was Etsy. The online arts and crafts marketplace was a superstar last year. People stuck at home have discovered the joys of the hustle and bustle in creating artistic products. Buyers looking for unique face covers as COVID-19 protection have turned to Etsy.

Comparisons are going to get tricky now, and that may be why the stock took a 12% hit in the last two trading days of last week after the company released mixed financial results. Revenue growth slowed to 23% on a mere 13% increase in gross merchandise sales, but it was actually just ahead of analyst expectations. The real dagger in last week’s report was the guidance, with Etsy forecasting a sequential drop in revenue well below Wall Street’s target.

Etsy has already clawed back about half of last week’s success, but it’s still a bell for Wood. The online marketplace isn’t going away anytime soon, and the pandemic has only helped accelerate the number of buyers and sellers who are now comfortable on the platform.