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5 Cathie Wood Stocks Analysts Expect to Rally

Barchart - Fri Jan 19, 12:13PM CST

Any new stock purchase or sale by charismatic stock picker Cathie Wood draws plenty of headline attention from financial media and market participants. The maverick fund manager, known for making outsized bets on “disruptive” tech companies, has garnered her fair share of followers and critics over the years. However, investors attempting to reproduce Wood's momentum-driven investing strategy should brace for volatility; for every breakout stock like Nvidia (NVDA) or Tesla (TSLA), there is a dud like Unity Software (U) or Invita (NVTA)
Given Wood's focus on momentum-driven growth stocks, her flagship Ark Innovation ETF (ARKK) tends to be prone to wild price swings. Although ARKK has underperformed the returns of the broader Nasdaq-100 Index ($IUXX) over the past 52 weeks, ARKK's highs and lows over this time frame have been considerably more extreme.

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While some of Wood's signature stock holdings - including Coinbase (COIN) and Robinhood Markets (HOOD) - aren't exactly on the top of Wall Street's “buy” list, there are still some growth stocks in her flagship ARKK fund which analysts believe have sizeable upside potential from current levels. Let's have a closer look at each of them. 

1. Archer Aviation Stock

Founded in 2018 and based out of San Jose, Calif., Archer Aviation (ACHR) develops electric vertical takeoff and landing (eVTOL) aircraft for urban air taxi services. These are essentially electric-powered flying vehicles designed to whisk passengers through city skies, offering a faster and potentially more eco-friendly alternative to traditional ground transportation.

With a market cap of $1.5 billion, Archer Aviation stock has rallied 77% over the past year.

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Analysts have deemed the stock a “Strong Buy” with a mean target price of $9.36, implying an upside potential of about 89.8% from current levels. Out of 7 analysts covering ACHR, 5 have a “Strong Buy” rating, 1 has a “Moderate Buy” rating, and 1 has a “Hold” rating.

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2. Exact Sciences Stock

Founded in 1995, Exact Sciences (EXAS) is a molecular diagnostics company that develops and markets non-invasive tests for the early detection of cancer. The company's flagship product is Cologuard, a non-invasive DNA test that detects colorectal cancer (CRC), the second leading cause of cancer death in the United States.

Its total market cap currently stands at just below $12 billion. Over the past year, Exact Sciences stock has declined by 0.7%.

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Analysts remain quite upbeat about the stock, which has an average rating of “Strong Buy” with a mean target price of $98.18. This indicates an upside potential of roughly 49% from current levels. Out of 19 analysts covering the stock, 16 have a “Strong Buy” rating and 3 have a “Hold” rating.

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3. Trade Desk Stock

Trade Desk (TTD) is a digital advertising company that focuses on real-time programmatic marketing automation technologies, products, and services, designed to personalize digital content delivery to users.

Founded in 2009, the Ventura, Calif.-based company has 225 partners worldwide, employing more than 2,800 people in 25 locations globally.

With a market cap of $31.8 billion, Trade Desk stock has rallied 48.3% over the past year.

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Overall, analysts are optimistic about the stock, with an overall rating of “Strong Buy” and a mean target price of $81.61. This implies an upside potential of 24.5% from current levels. 

Out of 27 analysts covering TTD, 20 have a “Strong Buy” rating, 2 have a “Moderate Buy” rating, 4 have a “Hold” rating, and 1 has a “Strong Sell” rating.

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4. Block Stock

Block (SQ), formerly known as Square, is a financial services company that offers payment processing, point-of-sale, and other business services. Founded by Twitter (now X) co-founder Jack Dorsey in 2009, Block currently commands a market cap of about $40 billion.

On the charts, Block stock is down 8.5% over the past year.

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Analysts remain optimistic about the fintech stock, giving it an overall rating of “Moderate Buy” with a mean target price of $78.82. This denotes an upside potential of about 21.5% from current levels. 

Out of 38 analysts covering SQ, 23 have a “Strong Buy” rating, 3 have a “Moderate Buy” rating, 11 have a “Hold” rating, and 1 has a “Strong Sell” rating.

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5. DraftKings Stock

Founded in 2012, Boston-based DraftKings (DKNG) has quickly emerged as a preeminent player in the online sports betting industry, with a 32% market share as of May 2023 - second only to FanDuel. Commanding a market cap of $32.25 billion, DraftKings allows betting across the MLB, NHL, NFL, NBA, Premier League, and UEFA Champions League, among others.

DraftKings stock has been on a tear over the past year, rising 175%.

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Despite the steep rally, analysts continue to remain upbeat about DKNG, deeming it a “Strong Buy” with a mean target price of $42. This denotes an upside potential of 13.3% from current levels. 

Out of 26 analysts covering the stock, 21 have a “Strong Buy” rating, 2 have a “Moderate Buy” rating, and 3 have a “Hold” rating.

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On the date of publication, Pathikrit Bose did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.

Provided Content: Content provided by Barchart. The Globe and Mail was not involved, and material was not reviewed prior to publication.

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