Cathie Wood is known as a star stock picker and is the CEO of Ark Invest (NYSEMKT:ARKK), an investment management firm that she founded.
After last week’s sell-off, Ark Invest started this week by purchasing shares several companies, including the three listed below.
All three are considerably down on their 2021 highs, and were pushed lower last week on the back of higher than expected US inflation data.
So, what was she buying? Wood added to her existing exchange-traded fund stakes in CRISPR Therapeutics (NYSE:CRSP), Invitae Corporation (NYSE:NVTA), and Pacific Biosciences (NASDAQ:PACB).
CRISPR Therapeutics
CRISPR Therapeutics is a biotech company using gene therapy to try to correct genetic mutations to treat and cure diseases. The firm has a market cap of around $4.28bn, but is down 57.1% over the past 12 months.
CRISPR (an acronym for clustered regularly interspaced short palindromic repeats) is a technology that can be used to edit genes. It’s considered more efficient than other technologies out there.
CRISPR plans on submitting its candidate treatment for blood disorders for regulatory approval at the end of this year. The company has also partnered with Vertex Pharmaceuticals, and reported positive clinical trial data with candidate products in sickle cell disease and beta thalassemia.
It could be a big winner, however, it will carry a lot of risk until it gains regulatory approval. The business itself has noted caution on the part of regulators with regards to gene therapy treatments.
Invitae Corporation
Invitae stock reached $61 a share last year before collapsing. It now trades for just $2.32. The stock is down 92% over the past year.
The biotechnology company does genetic screening and hopes to bring its product to billions of people. Invitae’s screening looks to highlight whether individuals have higher risk profiles for hereditary cancer and rare genetic diseases, among other illnesses.
Oncology is a major part of the business, accounting for almost two-thirds of its revenue in the first quarter.
The firm is in an interesting position after its stock price crash. It has a market cap of just short of $500m, but had $885 million in cash at the end of the first quarter. However, Invitae doesn’t anticipate being cash flow positive until 2025.
Pacific Biosciences
Pacific Biosciences is a biotech firm that develops and manufactures systems for gene sequencing and real time biological observation.
This stock has also crashed over the past year, from highs of $36 to the current $4.32. The stock is down 84% over the past year.
In 2019, Pacific Biosciences launched its Sequel II genome sequencing system, that offers eight times the data output of its older model. It also brought accuracy in line with traditional sequencing methods.
One issue is that the company is spending almost all of its revenue on development at the moment. Last year, it spent $113m. In 2021, the firm generated $130m in revenue.
On my to-do list
Given Wood’s interest in these stocks, I’ll be taking a closer look myself to see if any of them would be right for my portfolio. Biotechs are a bit new to me, so I’d want to do my research to understand both the risks and opportunities in the field.