5 FinTech Stocks to Buy According to Cathie Wood

2. Robinhood Markets, Inc. (NASDAQ:HOOD)

ARK Investment Management’s 13 Portfolio: 1.71% 

ARK Investment Management’s Stake Value: $410.07 million

Number of Hedge Fund Holders: 24

Next up is Robinhood Markets, Inc. (NASDAQ:HOOD), in which Cathie Wood owns 30.35 million shares valued at roughly $410 million as of the end of the first quarter of 2022. The financial services company operates a popular platform which enables amateur investors to buy and invest in stocks, cryptocurrencies, gold and exchange-traded funds (ETFs).

On May 12, shares of Robinhood Markets, Inc. (NASDAQ:HOOD) jumped 5.03% in a single day after news broke that the CEO of crypto exchange platform FTX Sam Bankman-Fried acquired a 7.6% stake in the firm worth approximately $648 million. FTX is one of the world’s largest cryptocurrency trading platforms and is a competitor to Coinbase and Binance.

Mizuho analyst Dan Dolev on May 2 lowered the firm’s price target on Robinhood Markets, Inc. (NASDAQ:HOOD) to $14 from $19 and maintained a ‘Buy’ rating on the company shares. The analyst attributed the price target decrease to reflect lower market multiples, a cut in guidance, and disappointing execution. The company’s EPS for Q1 2022 was -$0.45, missing estimates by $0.09. Revenue of $299 million for the quarter was also under analysts’ forecasts by $58.2 million.

Hedge fund sentiment was up on Robinhood Markets, Inc. (NASDAQ:HOOD) at the close of the fourth quarter of 2021, where 24 hedge funds were long on the company shares. In comparison, 20 hedge funds held stakes in the firm a quarter ago.

Here is what Claret Asset Management had to say about Robinhood Markets, Inc. (NASDAQ:HOOD) in its Q4 2021 investor letter:

“Robinhood went public at $38 a share at the end of July of this year. After a oneday decline of 8%, it proceeded to rise to a peak of $85 in a matter of 4 days before settling down around $40 in September. Then, we found out that the company does not appear to understand the margin rules that apply to their client’s trades… and got fined by the Securities Exchange Commission. As of today, it is trading below $20, at 57 times earnings, approximately half of its IPO price. Caveat emptor… Buyer beware.”