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2 Stocks in Cathie Wood's Portfolio to Watch Now

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Investors may not have the necessary acumen to make the right investment choices. So, they tend to emulate investment gurus like Warren Buffett and Peter Lynch to learn the art of investing. Another noticeable investor, Cathie Wood, lately got a lot of attention for her investing viewpoint that helped generate handsome returns.

Cathie Wood’s bellwether investment fund, the Ark Innovation ETF (ARKK), has scaled significantly upward over the past year, gaining a solid 22.2%. In reality, Cathie Wood’s Ark fund gained prominence in 2020 after notching returns of more than 100%. Ark fund mostly consists of stocks involved in disruptive innovation, something that Cathie Wood believes to be the best growth path.

Cathie Wood’s portfolio doesn’t have low-volatility, safe-haven dividend players, nor can you find Warren Buffett’s essential value picks. In its place, Cathie Wood’s stocks focus on innumerable technologies, including artificial intelligence, blockchain, DNA sequencing and robotics, to name a few, that are predicted to change the fortune of the human race and the global economy.

Having said that, astute investors must keep an eye on stocks such as Zoom Video Communications, Inc. (ZM - Free Report) and Coinbase Global, Inc. (COIN - Free Report) that Cathie Wood has added to her funds over the years. These stocks are well-poised to provide attractive returns soon. Here’s why –

The videoconferencing company Zoom, despite facing stiff competition from the likes of Cisco Systems, Inc. (CSCO - Free Report) , Alphabet Inc. (GOOGL - Free Report) and Microsoft Corporation (MSFT - Free Report) , posted encouraging quarterly results on Feb 26. The company’s net income for the fourth quarter came in at $298.8 million, in contrast to the year-ago quarter’s net loss of $104.1 million.

It’s been a remarkable turnaround for the video chat software vendor banking on an increase in enterprise customers. Zoom may be way past its prime during the pandemic but is expected to do well in the future due to its initiatives to get rid of privacy flaws and continued remote working trends.

The Zacks Consensus Estimate for Zoom’s current-year earnings has increased 0.6% over the past 90 days. Zoom’s expected earnings growth rate for the current year is 13%. Its estimated revenue growth rate for the current year is 2.7%. Zoom currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks Rank #1 (Strong Buy) stocks here.

Crypto-trading platform Coinbase also recently posted promising quarterly results. Coinbase registered a net income of $273 million in the fourth quarter against a net loss of $557 million in the year-ago quarter. Revenues increased to $954 million from the year-ago quarter’s sales of $629 million.

Coinbase has now become a fundamentally sound company on the back of the ever-increasing price of cryptocurrencies, including Bitcoin (BTC). The price of Bitcoin rallied almost close to its record high on Feb 26 as investors continued to place bets on the world’s numero uno cryptocurrency after the U.S. Securities and Exchange Commission approved the Bitcoin spot ETF. The forthcoming “halving” event has also been traditionally bullish for the price of Bitcoin (read more: 3 Crypto Stocks to Buy as Bitcoin Climbs to Kick-Off 2024).

The Zacks Consensus Estimate for Coinbase’s current-year earnings has soared 253% over the past 60 days. Coinbase’s expected earnings growth rate for the current year is 173%. Its estimated revenue growth rate for the current year is 29.3%. Coinbase, at present, has a Zacks Rank #1.


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