Ark Invest added to three existing positions on Monday, all of them down sharply from recent highs.
Ark Invest added to three existing positions on Monday, all of them down sharply from recent highs.
Cathie Wood kicked off the new trading week making just a handful of trades. The co-founder, CEO, and chief investment officer at Ark Invest added to her stakes in CoreWeave (CRWV +2.88%), Scribe Therapeutics (SCTX +3.45%), and Freenome (FRNM +9.87%) on Monday.
The three stocks are trading 28% to 57% below their previous highs. Wood loves growth stocks, but she's not a momentum player. She's not afraid of adding to existing positions on the way down. Let's take a closer look at the three potentially opportunistic purchases by Ark in October.
CoreWeave stock has been cut in half over the past year, but the 28% plunge over the past month has been particularly painful. The hyperscaler has been one of several AI plays that have corrected sharply in recent weeks, as the market resets its previously lofty valuation multiples.
CoreWeave was started by a few hedge fund friends who pooled their resources to buy GPUs to mine crypto. When that revenue stream hit a rough patch, they shifted to the AI opportunity. Their side hobby would become a business, and CoreWeave is now a leading provider of access to its data centers stocked with next-gen AI chips.
$62.88+$1.76 (+2.88%)
NASDAQ · As of 12:41 PM ET 10/20/26
Top-line growth has been spectacular. CoreWeave's revenue soared 113% in its latest quarter, accelerating in back-to-back quarters so far this year. Triple-digit revenue growth has been the default setting for CoreWeave amid the boom in demand for AI compute, but profitability has been another story.
It costs money to build out its hosting empire with costly components. Losses continue. Analysts don't expect CoreWeave to post an adjusted profit until 2028. Positive earnings on a reported basis aren't expected until 2029. If you think Wall Street pros are being conservative, consider that they have underestimated the deficit in two of the last three quarters.
The rise in interest rates has crashed the party for CoreWeave investors. It's a heavily leveraged company, so it's paying the price for rising borrowing costs. It's also now that much harder for customers to finance their lofty AI ambitions. The sell-off continues after Wood was a buyer on Monday. CoreWeave stock hit another 52-week low on Tuesday.
Averytin News Financial update.