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UPDATE 1-Star stock-picker Cathie Wood buys the Zoom dip, invests over $56 million

reuters.com · 09/01/2021 08:52
UPDATE 1-Star stock-picker Cathie Wood buys the Zoom dip, invests over $56 million

Adds details on ARK funds, Zoom shares

- Star investor Cathie Wood's funds scooped up $56.5 million worth of shares in Zoom Video Communications Inc ZM, taking advantage of a 17% drop in the company's stock price on Tuesday after warning on slowing demand.

Wood's bet on Zoom and other pandemic winners such as online healthcare service provider Teladoc Health Inc TDOC had helped her ARK Innovation's portfolio outperform all other U.S. equity funds in 2020, although the fund has lagged this year.

Asset manager Ark Invest said it added about $45.5 million shares of Zoom to the flagship ARK Innovation ETF ARKK.P and about $11 million in the ARK Next Generation Internet ETF ARKW.O.

The video conferencing company issued a dour forecast of 31% rise in third-quarter revenue compared with the multiple-fold growth rates seen last year amid remote work and schooling.

Its shares have nearly halved in value compared to their peak in October last year as the pandemic-boom started to fade. Meanwhile, the $25.5 billion ARKK is down about 2% for the year, clawing back from losses of about 22%.

Separately, ARK Fintech Innovation ETF ARKF.P added about $11.5 million shares of Robinhood Markets Inc HOOD. Wood's interest in the popular trading app after its weak market debut in late-July partly drove a rally in the stock.

Zoom shares were up 0.9% to $292.16 in premarket trading.

(Reporting by Medha Singh in Bengaluru; Editing by Arun Koyyur)

((Medha.Singh@thomsonreuters.com; within U.S. +1646 223 8780, outside U.S. +91 80 6182 2802; Twitter: https://twitter.com/medhasinghs;))