Ark Invest Stock Portfolio: 5 Biggest Positions

2. Zoom Video Communications, Inc. (NASDAQ:ZM)

Number of Hedge Fund Holders: 40  

Zoom Video Communications, Inc. (NASDAQ:ZM) provides a unified communications platform in the Americas, the Asia Pacific, Europe, the Middle East, and Africa. ARK Investment Management has 10.6 million shares worth $719 billion in Zoom Video Communications, Inc. (NASDAQ:ZM) which makes about 6.23 % of its total investment. 

Among the hedge funds being tracked by Insider Monkey, St. Petersburg, Florida-based investment firm ARK Investment Management is a leading shareholder in Zoom Video Communications, Inc. (NASDAQ:ZM) with 10.6 million shares worth more than $719 billion. 

In its Q1 2022 investor letter, Horos Asset Management, an asset management firm, highlighted a few stocks and Zoom Video Communications, Inc. (NASDAQ:ZM) was one of them. Here is what the fund said:

“What about the other asset class that has attracted the most attention from the investment community in recent times? Here we can distinguish three major groups. First, those companies without earnings that had convinced investors of their great future growth prospects, pushing up their valuations to irrational levels. A clear example of this, which we mentioned almost two years ago is Zoom Video Communications (“Zoom”), whose market cap exceeded that of companies such as IBM or came close to that of Cisco Systems. Well, from the time we wrote about this odd situation until today, Zoom shares have collapsed by nearly 80%.

Therefore, if interest rates rise (or are expected to rise), company valuations are negatively impacted. This is especially true for those businesses that generate little cash today and the market expects them to generate a lot of cash in the future. Hence the severe losses in companies that promised a lot of cash generation in the future (such as Zoom).”