Cathie Wood's Ark Invest Buys Roblox, Accolade, and Intellia Shares After Sharp Declines

Cathie Wood's Ark Invest buys shares of Roblox, Accolade, and Intellia Therapeutics after their stock prices decline. The companies' recent financial results and guidance had raised concerns among investors, leading to the stock price drops.

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Aqsa Younas Rana
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Cathie Wood's Ark Invest Buys Roblox, Accolade, and Intellia Shares After Sharp Declines

Cathie Wood's Ark Invest Buys Roblox, Accolade, and Intellia Shares After Sharp Declines

On May 9, 2024, Cathie Wood's Ark Invest seized the opportunity to purchase shares of Roblox, Accolade, and Intellia Therapeutics after their stock prices experienced significant declines. Roblox, in particular, saw its shares plummet by 22% following the release of poorly received financial results.

Why this matters: This investment move by Ark Invest highlights the firm's confidence in the long-term potential of these companies, despite their current struggles, and demonstrates its commitment to investing in innovative and disruptive technologies. The success of these companies could have a significant impact on their respective industries and the broader economy.

Despite Roblox's revenue rising 22% to $801.3 million in the first quarter, fueled by a 19% surge in bookings, the company's guidance raised concerns among investors. Roblox expects bookings to decline sharply in the second quarter and has revised its full-year guidance downward. The company reported a loss of $0.43 per share, which was better than anticipated.

Accolade, a healthcare benefits specialist, has seen its shares shed nearly 40% of their value this year and more than half since peaking four months ago. The company posted disappointing fiscal fourth-quarter results, prompting at least five analysts to slash their price targets. However, Richard Close at Canaccord remains bullish on the shares, citing historical bounce-backs after sharp sell-offs.

Intellia Therapeutics, a gene editing specialist, saw its shares rise 8% after its financial update, despite having lost almost half of its value over the past year. The company reported stronger revenues and a smaller deficit than expected. Intellia closed the quarter with $953 million in cash and marketable securities, providing a solid foundation as it prepares for key Phase 3 trials.

During IntelliaTherapeutics'Q1 2024 earnings call, CEO John Leonard highlighted the company's progress, including ongoing and upcoming pivotal Phase 3 trials, the largest set of safety and clinical activity data for in vivo CRISPR-based therapies, and the potential for one-time treatments for ATTR and HAE. Leonard also emphasized Intellia's expansion of its CRISPR-based technology and the establishment of collaborations with external innovators to pursue gene editing in five new tissue types outside the liver.

Cathie Wood's Ark Invest has a history of investing in innovative and disruptive technologies, and the recent purchases of Roblox, Accolade, and Intellia Therapeutics shares demonstrate the firm's continued commitment to this strategy. By capitalizing on the short-term market volatility, Ark Invest aims to position itself for potential long-term gains in these companies, which are at the forefront of their respective industries.

As of March 31, 2024, Intellia Therapeutics had cash, cash equivalents, and marketable securities worth $953.4 million, providing a solid financial foundation for the company's ongoing research and development efforts. With multiple clinical programs in progress and collaborations with partners such as Regeneron Pharmaceuticals, Intellia Therapeutics is well-positioned to advance its pipeline and potentially bring groundbreaking gene editing therapies to patients in need.