Cathie Wood is known for making risky investment bets on fundamentally sound growth stocks. Her bets on quality tech and electric vehicle (EV) stocks have led her to market-beating returns in the pandemic era. However, since last year, Cathie Wood’s ARK ETFs have been hit hard by investors’ switch from growth to value stocks amid concerns surrounding skyrocketing inflation, the Fed’s tighter monetary policy, elevated stock valuations, and escalating war tensions between Russia and Ukraine.
Wood has been reshuffling her ETF holdings to mitigate the market headwinds. And the recent stock market turbulence provides a great opportunity for long-term investors to add quality Cathie Wood stocks to their portfolios. These stocks are trading at low prices, and we think are well-positioned to withstand the bearish market trends.
Given these factors, Wall Street analysts expect Cathie Woods stocks Coinbase Global, Inc. (COIN), Zoom Video Communications, Inc. (ZM), Unity Software Inc. (U), Roku, Inc. (ROKU), and Exact Sciences Corporation (EXAS) to surge in price in the coming months.
Coinbase Global, Inc. (COIN)
San Francisco-based COIN offers financial infrastructure and technology for the crypto-economy in the U.S. and internationally. The company provides the primary financial account in the crypto-economy for retailers and a marketplace with a pool of liquidity for transacting in crypto assets for institutions. In addition, it offers technology and services that enable partners to build crypto-based applications. The stock has a 4.88% weighting across all Ark ETFs.
In its fiscal year 2021 fourth quarter, ended Dec. 31, 2021, COIN’s total revenue increased 327% year-over-year to $2.50 billion. The company’s operating income grew 307.1% year-over-year to $922.32 million. And its adjusted EBITDA increased 318.8% from the prior-year period to $1.20 billion. COIN’s net income rose 375.3% year-over-year to $840.21 million. And its net income per share attributable to common shareholders grew 403% year-over-year to $3.32.
The company has an impressive earnings surprise history; it surpassed the consensus EPS estimates in three of the trailing four quarters.
COIN shares have slumped 39.3% in price year-to-date. However, the 12-month median price target of $304.93 indicates a 99.1% potential upside from yesterday’s closing price of $153.19. Among the 15 Wall Street analysts that rated COIN, 12 rated it Buy, two rated it Hold, and one rated it Sell. The price targets range from a low of $200.00 to a high of $405.00.
Zoom Video Communications, Inc. (ZM)
ZM in San Diego, Calif., provides a unified communications platform in the Americas, Europe, the Asia Pacific, the Middle East, and Africa. The company offers applications and platforms including Zoom Meetings, Zoom Phone, Zoom Chat, Zoom Rooms, Zoom Hardware-as-a-Service, Zoom Events, Zoom Webinars, and Zoom App Marketplace. It serves individuals, education, entertainment, enterprise infrastructure, finance, government, healthcare, manufacturing, and software. The stock has a 3.89% weighting across all Ark ETFs.
Last December, ZM partnered with oVice, Inc. to allow oVice’s customers to seamlessly access its Zoom meetings without switching from one tool to another. This business partnership is expected to boost ZM’s revenue streams.
ZM’s total revenue increased 21.4% year-over-year to $1.07 billion in its fiscal year 2022 fourth quarter, ended Jan. 31, 2022. ZM’s gross profit increased 32.3% year-over-year to $814.03 million. Its income from operations improved 16% year-over-year to $420.3 million. ZM’s net income grew 7.7% year-over-year to $393.58 million and the company’s net income per share rose 5.7% year-over-year to $1.29.
The $1.07 billion consensus revenue estimate for its fiscal year 2023 first quarter, ending April 30, 2022, represents 12.3% year-over-year growth from the same period in 2021. The company has an impressive earnings surprise history; it surpassed the consensus EPS estimates in each of all the trailing four quarters.
ZM stock has declined 48.5% in price year-to-date and 48% over the past three months. However, the 12-month median price target of $176.43 indicates a 76% potential upside. Among the 26 Wall Street analysts that rated ZM, 13 rated it Buy, while 13 rated it Hold. The price targets range from a low of $100.00 to a high of $295.00.
Unity Software Inc. (U)
U operates a platform for creating and operating interactive, real-time three-dimensional content. Its platform provides software solutions to create, run, and monetize interactive real-time 2D and 3D content for mobile phones, PCs, consoles, augmented and virtual reality devices. The San Francisco company serves creators, developers, designers, artists, engineers, and architects and offers solutions directly through online stores, field sales operations, distributors, and resellers. U has a 3.06% weighting across all Ark ETFs.
On March 11, 2022, U announced a new partnership with Insomniac Events, the world’s leading live music experience creator, to bring a brand new metaverse world to the community. This partnership might expand the company’s customer reach and profitability.
On Dec. 2, 2021, U completed the acquisition of Weta Digital’s tools, pipeline, technology, and engineering talent. “By bringing this team and technology to Unity, we can enable more storytellers to reach their creative potential by giving them access to the diamonds of all diamonds of VFX tools, underpinned by the power of real-time 3D,” said Marc Whitten, Senior Vice President, and General Manager, Create Solutions at Unity.
In its fiscal year 2021 fourth quarter, ended Dec. 31, 2021, U’s revenue increased 43.4% year-over-year to $315.86 million. The company’s gross profit grew 46.1% year-over-year to $252.25 million.
Analysts expect U’s revenue for its fiscal year 2022 first quarter, ending March 31, 2022, to come in at $321.17 million, representing a 336.8% rise year-over-year. The Street expects the company’s EPS for the current quarter to grow 18.9% year-over-year.
U stock has plunged 31.7% in price year-to-date. However, the 12-month median price target of $150.50 indicates a 99% potential upside. Among the eight Wall Street analysts that rated U, six rated it Buy, while two rated it Hold. The price targets range from a low of $100.00 to a high of $185.00.
Roku, Inc. (ROKU)
ROKU in San Jose, Calif., operates a TV streaming platform. The company operates through two segments: Platform; and Player. Its platform allows users to access various movies, TV episodes, live TV, news, shows, and others. ROKU provides digital and video advertising, content distribution subscription, and billing services. In addition, it sells and licenses smart TVs under the Roku Tv name and offers streaming players and audio products under the Roku brand name. The company has more than 60 million active accounts. ROKU has a 4.05% weighting across all Ark ETFs.
In February, ROKU launched an advertising business in Mexico, allowing brands and content providers to reach more consumers through ad-supported content in Mexico. As a part of the launch, ROKU partnered with Entravision, a leading digital marketing and media company with local operations in Mexico. The launch might promote the expansion of the company’s advertising business and boost its revenues.
ROKU’s total net revenue increased 33.2% year-over-year to $865.33 million in its fiscal year 2021 fourth quarter, ended Dec. 31, 2021. ROKU’s total gross profit improved 24.3% year-over-year to $379.64 million. The company’s cash and cash equivalents increased 96.4% year-over-year for the year ended Dec. 31, 2021, to $2.15 billion. ROKU’s total current assets grew 79.9% year-over-year to $3.05 billion.
The $720.49 million consensus revenue estimate for its fiscal year 2022 first quarter, ending March 31, 2022, represents25.5% year-over-year growth. The company has an impressive earnings surprise history; it surpassed the consensus EPS estimates in three of the trailing four quarters.
ROKU shares have declined 55.9% in price year-to-date and 71.5% over the past year. However, the 12-month median price target of $190.58 indicates an 93% potential upside. Among the 19 Wall Street analysts that rated ROKU, 15 rated it Buy, one rated it Hold, while three rated it Sell. The price targets range from a low of 95.00 to a high of $305.00.
Exact Sciences Corporation (EXAS)
EXAS provides cancer screening and diagnostic test products in the U.S. and internationally. The Madison, Wisc.-based concern focuses on the early detection and prevention of some forms of cancer. The company offers a wide range of test products, including Cologuard, Oncotype DX, Oncotype DX AR-V7 Nucleus Detect, and Oncomap ExTra. It also provides COVID-19 testing services. The stock has a 4.24% weighting across all Ark ETFs.
On Jan. 10, 2022, EXAS acquired PreventionGenetics, a genetic testing laboratory, to accelerate the availability of hereditary cancer testing (HCT) for more patients. PreventionGenetics provides the clinical lab, expertise, and foundational technology to EXAS necessary for HCT. This acquisition is expected to expand EXAS’ patient base and boost profitability.
In its fiscal year 2021 fourth quarter, ended Dec. 31, 2021, EXAS’ revenue increased marginally year-over-year to $473.81 million. The company’s net investment income grew 20.3% year-over-year to $1.25 million. And its total assets increased 35.7% year-over-year for the year ended Dec. 31, 2021, to come in at $6.68 billion.
Analysts expect EXAS’ revenue for its fiscal year 2022 first quarter, ending March 2022 to come in at $458.49 million, representing a 14% rise year-over-year.
Over the past year, EXAS stock has declined 55.1% in price. However, the 12-month median price target of $107.73 indicates an 88% potential upside from yesterday’s closing price of $58.71. Among the 11 Wall Street analysts that rated EXAS, nine rated it Buy, while two rated it Hold. The price targets range from a low of $80.00 to a high of $155.00.
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COIN shares were trading at $151.84 per share on Tuesday afternoon, down $1.35 (-0.88%). Year-to-date, COIN has declined -39.83%, versus a -11.25% rise in the benchmark S&P 500 index during the same period.
About the Author: Mangeet Kaur Bouns
Mangeet’s keen interest in the stock market led her to become an investment researcher and financial journalist. Using her fundamental approach to analyzing stocks, Mangeet’s looks to help retail investors understand the underlying factors before making investment decisions. More...
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