Cathie Wood’s Ark Invest made strategic moves this Monday, capitalizing on market volatility to increase its stakes in Nvidia, Baidu, and Iridium Communications, all of which have seen their stock prices dip significantly from recent highs.
Wood, known for her aggressive growth investment strategy, isn’t shy about buying when stocks are down; these purchases highlight her confidence in these companies’ long-term prospects despite recent market fluctuations. The market experienced its widest swing in five years the same day Wood increased her stakes in these companies.
Nvidia (NVDA)
Nvidia shares, after a period of explosive growth, have cooled off, dropping 27% this year and 36% since hitting an all-time high three months ago. Despite this, Nvidia remains the country’s third most valuable company by market cap.
While Nvidia’s revenue growth has decelerated from over 100% to 78% in recent reports, the company still dominates the AI chip market and benefits from booming trends like autonomous driving and virtual reality. The company faced a stumble in January after China’s DeepSeek announced it was able to produce AI results using older Nvidia chips.
Nvidia’s stock is trading at attractive multiples of 21 times this year’s earnings and 16 times next year’s target, making it a compelling value for growth investors. Despite potential cyclical challenges in the semiconductor industry, Nvidia is projected to maintain robust double-digit growth for the next few years.
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Baidu (BIDU)
Baidu‘s stock has fallen 31% from its October peak and a staggering 78% from its all-time high four years ago. Like Nvidia, Baidu is involved in cutting-edge industries such as autonomous driving and AI.
Baidu has struggled to achieve consistent growth, posting only one year of double-digit revenue growth in the last six years, with top-line declines in half of those years.
Despite these challenges, Wood is adding to her Baidu position, trading at just 8 times this year’s profit target and 7 times the 2026 forecast. The company’s enterprise value is just $23.5 billion, a discount from its $27.4 billion market cap, reflecting its strong net cash position.
Iridium Communications (IRDM)
Iridium, a satellite communications specialist, has seen its shares fall 35% from October highs. Similar to Baidu, Iridium has struggled to translate its market position into strong financial results, with only one year of double-digit revenue growth in the past six.
Iridium’s subscriber base has grown by 8% to 2.5 million over the past year, and the company has been profitable for the last three years while paying a quarterly dividend, yielding 2.4%. Despite competitive pressures, analysts predict continued single-digit revenue growth.
Iridium trades at less than 18 times next year’s earnings forecast, making it more expensive than Nvidia on a bottom-line multiple basis but still appealing to Wood following the recent pullback.
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