Cathie Wood Watch: Ark Buys E-Commerce, Biotech Stocks

© The Street

By Dan Weil

Ark also sold four stocks, including a defense contractor and a financial management software company.

Renowned investor Cathie Wood, chief executive of Ark Investment Management, bought shares of a biotech and a technology company focused on enabling international e-commerce.

She also sold four companies. All valuations below are as of Tuesday’s close.

Ark Fintech Innovation ETF (ARKF) - Get ARK Fintech Innovation ETF Report purchased 96,707 shares of Global-E Online (GLBE) , the e-commerce company, valued at $2.2 million.

Global-E Online's e-commerce platform, the website says, uses "localization capabilities, big-data, best-practice business intelligence models, [and] streamlined international logistics [to] enable retailers and brands to increase international traffic conversion and sales and achieve significant global online growth."

The stock leaped 18% on May 17 but is still trading around a quarter of its 52-week high near $84, set at the end of last August.

Ark funds snagged 4,049,903 shares of Ginkgo Bioworks (DNA) valued at $11.1 million.

On the selling side, Ark Genomic Revolution ETF (ARKG) - Get ARK Genomic Revolution ETF Report sold 112,333 shares of Burning Rock Biotech (BNR) , valued at $361,712.

Ark Innovation ETF (ARKK) - Get ARK Innovation ETF Report shed 158,765 shares of Singapore-based Sea (SE) - Get Sea Ltd. (Singapore) Report, a digital entertainment company, valued at $12.7 million.

Ark Fintech Innovation unloaded 7,492 shares of Intuit (INTU) - Get Intuit Inc. Report, the financial management software company, valued at $2.8 million.

And Ark Autonomous Technology & Robotics ETF (ARKQ) - Get ARK Autonomous Technology & Robotics ETF Report dumped 1,403 shares of Lockheed Martin (LMT) - Get Lockheed Martin Corporation Report, the world’s largest defense contractor, valued at $618,723.

Trailing the S&P 500

As Ark funds have tumbled in recent months, Wood has defended herself by noting that she has a five-year investment horizon.

And the five-year track record of her flagship fund Ark Innovation could indeed give investors comfort until May 9. The fund’s five-year return beat that of the S&P 500 until then. But the five-year annualized return of Ark Innovation totaled 12.59% through May 17, compared to 13.66% for the S&P 500.

Ark Innovation has slumped 55% this year as Wood’s young, disruptive technology companies have hit the skids. And it’s down 73% from its February 2021 peak. Raging inflation and soaring interest rates have helped put the kibosh on tech stocks.

Still, Wood’s investors aren’t deserting her. Ark Innovation has enjoyed a net inflow of more than $1.5 billion year to date as of the week of May 9, according to Bloomberg.

Morningstar’s View

Meanwhile, on March 29, Morningstar analyst Robby Greengold issued a scathing critique of Ark Innovation.

“ARKK shows few signs of improving its risk management or ability to successfully navigate the challenging territory it explores,” he wrote.

“Since its meteoric rise in 2020, the strategy has been one of the worst-performing U.S.-sold funds.… Wood’s reliance on her instincts to construct the portfolio is a liability.”

Wood countered Greengold’s points in a recent interview with Magnifi Media by Tifin. “I do know there are companies like that one [Morningstar] that do not understand what we're doing,” she said.

“We do not fit into their style boxes. And I think style boxes will become a thing of the past, as technology blurs the lines between and among sectors.”

The author of this story owns shares of Lockheed Martin.