Cathie Wood was busy last week. The CEO, co-founder, and primary stock picker for the Ark Invest family of exchange-traded funds (ETFs) made several portfolio moves. Ark publishes its portfolio transactions daily, giving investors refreshing transparency into what the widely followed money manager is doing.
What is Wood adding to her portfolios these days? She added to her stakes in UiPath (PATH 0.26%), The Trade Desk (TTD 1.67%), and Nu (NU 1.66%) last week. What does she see in these three stocks that have risen by more than 70% since the start of last year? Let's take a closer look.
UiPath
The case for embracing robotics in the workplace keeps getting louder. Human labor costs are rising. The global manpower shortages during the pandemic were a wake-up call for leaning on the efficiencies and reliability of automation. As a leader in cloud-first software solutions for robotics and automation, UiPath is a tale of two starting lines.
UiPath is technically a broken IPO, trading for less than half of the $56 a share it went public at three years ago. However, momentum has turned positive. The stock has more than doubled since bottoming out 14 months ago. Wood was a buyer of the stock in three of her ETFs on Thursday after providing a financial update, and this was after lightening her stake in two other ETFs earlier in the week.
Image source: Getty Images.
UiPath posted record financial results for its fiscal fourth quarter on Wednesday afternoon. Revenue rose a better-than-expected 31%. Its adjusted operating margin widened substantially as fiscal 2024 played out, and UiPath scored its first quarterly profit on a reported basis as a public company. The shares initially shot higher on the report, but the stock would drift to close 7% lower on Thursday. Wood was a buyer despite the downticks. It's a sharp contrast to the 27% surge in share price that shareholders experienced after its previous quarterly update.
There is still a lot to like at UiPath. Revenue growth picked up the pace in fiscal 2024 after back-to-back years of sharp deceleration. Revenue growth accelerated in each of the four quarters of the fiscal year. With a dollar-based net retention rate of 119% -- meaning that returning customers are spending 19% more than they were a year earlier -- customers find new ways to lean on UiPath's platform. Its annualized renewal run rate gets stronger the larger the customer. UiPath is also a leader in incorporating artificial intelligence (AI) in robotics and automation, an emphasis that continues to excite growth investors.
The Trade Desk
Advertising may not seem like a growth industry, but The Trade Desk's leadership position in programmatic advertising -- where algorithms help allocate marketing budgets -- is resilient. The Trade Desk has posted eight consecutive years of double-digit revenue growth, a major accomplishment in an industry that has its share of ups and downs.
The adtech bellwether saw its shares soar 17% the day it posted well-received financial results last month. Revenue rose 23%, ahead of market expectations. It was a rare miss on the bottom line for The Trade Desk, but guidance boosted investor enthusiasm in the stock. The Trade Desk sees its top line clocking in with a 25% year-over-year increase for the current quarter, a welcome sign of acceleration.
Nu
The hottest of the three stocks in this list is Nu. The parent company of Latin America's Nubank has nearly tripled since the start of last year. Nubank wasn't even around 11 years ago, and now more than half of Brazil has a financial relationship with the bankless fintech speedster.
Revenue rose 57% in its latest quarter with adjusted net income more than tripling. If you're not a fan of "adjusted" earnings, I buried the lede. Reported net income skyrocketed nearly sixfold. Despite its rapid growth, Nu has managed to post six straight quarters of reported profitability.
UiPath, The Trade Desk, and Nu were strong growth stock additions to Wood's shopping list last week. Let's see what she buys this week.
