Despite the market’s recent surge, several notable stocks are struggling to regain their footing. Shares of Pinterest, GitLab, and PayPal have plummeted over 30% from their 52-week highs. However, Cathie Wood’s Ark Invest has taken advantage of these discounted prices, adding to her positions in all three companies on Monday.
Pinterest, in particular, presents a mixed bag. On the positive side, the visual discovery platform has rebounded from its post-pandemic slump, with year-over-year revenue growth accelerating in five of the last six quarters. Its user base has expanded by 12% to a record 522 million active accounts, and adjusted earnings per share have soared 38%. However, the company’s guidance for the current quarter was disappointing, with projected revenue growth slowing to 16-18%.
Meanwhile, PayPal’s stock has also taken a hit, despite its strong fundamentals. The fintech giant has generated over $5 billion in annual free cash flow and boasts 429 million active users. Its total payment volume is accelerating, up 11% in its latest quarter. With an earnings multiple in the teens, PayPal presents a relatively affordable option in the promising fintech space.
GitLab, on the other hand, has been a consistent outperformer, with revenue growth exceeding 30% and a history of beating Wall Street profit targets. Although its stock has yet to recover from a March stumble, its latest update suggests healthy momentum, and its AI-assisted software development offerings hold promise. Wood’s confidence in these stocks at current levels is a testament to their potential for long-term growth.
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