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Investors are always eyeing Cathie Wood stocks, considering their potential in disruptive technologies and robust returns. While Wood’s flagship ARK Innovation ETF (NYSEARCA:ARKK) has faced an 8% decline year-to-date (YTD), the S&P 500 and Nasdaq 100 have shown gains of 3.9% and 4.6%, respectively. However, several companies in her portfolio present potentially lucrative long-term investment opportunities, given their attractive valuations.
Tesla (TSLA)
Although the recent TSLA stock price decline has rattled many, Cathie Wood’s optimism for Tesla (NASDAQ:TSLA) remains steadfast. She believes in the anticipated acceleration of global electric vehicle (EV) adoption and Tesla’s accelerating artificial intelligence (AI) capabilities.
While Tesla’s Q4 2023 results fell below expectations, with a mere 3% year-over-year (YOY) revenue increase to $25.17 billion and a non-GAAP net income of $2.49 billion, Wood emphasizes the broader narrative of global EV market expansion. She argues that temporary production hurdles and volume growth declines signify a cyclical trough, not a fundamental shift in the company’s trajectory.
Despite a 25% YTD plunge, TSLA shares are trading at a valuation of 57.5 times forward earnings and 6.8 times trailing sales. The 12-month median price forecast for TSLA shares is at $223, suggesting a potential 20% upside.
CRISPR Therapeutics (CRSP)
Switzerland-based CRISPR Therapeutics (NASDAQ:CRSP) holds potential as a compelling opportunity among Cathie Wood’s stock picks. Its technology to alter DNA sequences could lead to significant therapeutic advancements.
CRISPR achieved the first FDA approval for its gene-editing therapy, Casgevy, in treating sickle cell disease (SCD) and beta thalassemia, unlocking a potential multi-billion dollar revenue stream for the company. With approximately 100,000 SCD patients in the U.S., the total addressable market for Casgevy is estimated at $70 billion.
Despite initial skepticism around widespread adoption due to the anticipated high cost of treatment, CRSP shares have made a significant recovery and returned around 15% YTD, currently trading at 35.5 times sales with an average analyst price target of $79.
Unity Software (U)
Unity Software (NYSE:U), the video game software developer with a platform to monetize interactive content, has been navigating the fallout from new strict rules on video games in China. Despite operational challenges, Cathie Wood’s substantial purchase in Unity stock reflects her confidence in the metaverse and virtual reality (VR) space, which could further drive the demand for gaming platforms.
Unity stock has declined 19% YTD, currently trading at 6.3 times trailing sales. The 12-month median price forecast for U shares is at $36, signaling a potential 10% upside.
On the date of publication, Tezcan Gecgil did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Tezcan Gecgil, PhD, began contributing to InvestorPlace in 2018. She brings over 20 years of experience in the U.S. and U.K. and has also completed all 3 levels of the Chartered Market Technician (CMT) examination. Publicly, she has contributed to investing.com and the U.K. website of The Motley Fool.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
