In this article, we discuss the 10 micro-cap stocks to buy according to Cathie Wood.
Cathie Wood, the ARK Investment Management CEO, has been known to leverage her hedge fund to seek out disruptive market innovations, betting aggressively on technologies that she thinks will revolutionize the world as we see it.
Even though Tesla, Inc. (NASDAQ:TSLA) remains her largest holding to date, Wood believes in constantly changing her bets according to the market dynamics, and by October, she had sold $600 million of her Tesla, Inc. (NASDAQ:TSLA) stock to invest in the crypto stocks that were in the limelight, including Coinbase Global, Inc. (NASDAQ:COIN) and Robinhood Markets, Inc. (NASDAQ:HOOD).
Wood has brushed off concerns from analysts who are skeptical of her bullish stance on disruptive tech, forecasting that Bitcoin prices could jump from current levels to more than $500,000 over the next five years. As much as she endorses Bitcoin, Wood has stated that Ethereum and NFTs could be even more undervalued and underestimated at current levels, hence they make for good investment opportunities.
Wood also sold most of her Chinese stocks in the third quarter, including Alibaba Group Holding Limited (NYSE:BABA), since she believes that the Chinese market is quite unpredictable, and with 75% of consumer savings being invested in a falling Chinese real estate sector, she thinks it’s time for her to cash out of these companies. Similarly, according to Wood, traditional banks will become obsolete quite soon, and she is directing her stakes towards cryptocurrency and digital wallets, like Block, Inc. (NYSE:SQ) and Coinbase Global, Inc. (NASDAQ:COIN), and also PayPal Holdings, Inc. (NASDAQ:PYPL).
Despite gaining 90% over the last year, ARK Innovation ETF has dipped 11% in 2021, as compared to an 18% gain for the S&P 500 Index. However, Cathie Wood remains adamant on her bullish stance on disruptive tech, and says ‘benchmark stocks’ are in a bubble, not her bets.
Cathie Wood of ARK Investment Management
Some of the notable stocks from Cathie Wood’s ARK Investment Management’s Q3 portfolio include Tesla, Inc. (NASDAQ:TSLA), Roku, Inc. (NASDAQ:ROKU), Shopify Inc. (NASDAQ:SHOP), and Zoom Video Communications, Inc. (NASDAQ:ZM).
Our Methodology
We used the Q3 portfolio of Cathie Wood’s ARK Investment Management to select the 10 best micro-cap stocks to buy according to her. Micro-cap stocks are categorized as companies with a market capitalization ranging from $50 million to $300 million.
We have ranked our list according to ARK Investment Management’s stake value in each holding.
Micro-Cap Stocks to Buy According to Cathie Wood
10. Ceragon Networks Ltd. (NASDAQ:CRNT)
ARK Investment Management’s Stake Value: $3,591,000
Percentage of ARK Investment Management’s 13F Portfolio: 0.00%
Number of Hedge Fund Holders: 8
Market Capitalization: $227.902 million
Ceragon Networks Ltd. (NASDAQ:CRNT) is a company from Israel offering wireless networking equipment to mobile operators, wireless service providers, and private businesses. Cathie Wood holds more than 1 million shares in Ceragon Networks Ltd. (NASDAQ:CRNT) as of Q3 2021, worth $3.59 million.
Ceragon Networks Ltd. (NASDAQ:CRNT), on November 1, reported third quarter earnings. EPS in the quarter totaled $0.02, beating estimates by $0.02. Revenue over the period increased 7.84% year-over-year, amounting to $76.12 million, exceeding estimates by $2.82 million. Ceragon Networks Ltd. (NASDAQ:CRNT) remains confident about revenue growth in 2021 and expects it to be on the higher end of the annual revenue guidance, which is between $275 million to $295 million.
The leading Q3 stakeholder of Ceragon Networks Ltd. (NASDAQ:CRNT) is Royce & Associates, with a $6.24 million stake in the company. Overall, 8 hedge funds in the database of Insider Monkey reported owning stakes in Ceragon Networks Ltd. (NASDAQ:CRNT), worth $13.6 million, down from 9 funds in the preceding quarter.
Ceragon Networks Ltd. (NASDAQ:CRNT) is a notable stock from Cathie Wood’s portfolio, in addition to Tesla, Inc. (NASDAQ:TSLA), Roku, Inc. (NASDAQ:ROKU), Shopify Inc. (NASDAQ:SHOP), and Zoom Video Communications, Inc. (NASDAQ:ZM).
9. PolyPid Ltd. (NASDAQ:PYPD)
ARK Investment Management’s Stake Value: $3,668,000
Percentage of ARK Investment Management’s 13F Portfolio: 0.00%
Number of Hedge Fund Holders: 4
Market Capitalization: $130.658 million
PolyPid Ltd. (NASDAQ:PYPD) is a clinical stage pharmaceutical company focused on developing and commercializing therapies to improve surgical outcomes. The signature technology patented by PolyPid Ltd. (NASDAQ:PYPD) is called PLEX, which is anchored in the surgical site to provide a stable and continuous delivery of medicines.
Cathie Wood holds 471,414 PolyPid Ltd. (NASDAQ:PYPD) shares as of September this year, valued at $3.66 million. PolyPid Ltd. (NASDAQ:PYPD) is one of the top micro-cap stocks in ARK Investment Management’s Q3 portfolio, with a market cap of $130.65 million.
On November 10, PolyPid Ltd. (NASDAQ:PYPD) announced its Q3 results, posting a loss per share of $0.53, beating estimates by $0.10.
Among the hedge funds being monitored by Insider Monkey in the third quarter, Louis Bacon’s Moore Global Investments is one of the leading PolyPid Ltd. (NASDAQ:PYPD) stakeholders, with 279,942 shares worth $2.18 million. Overall, a total of 4 hedge funds were bullish on PolyPid Ltd. (NASDAQ:PYPD) in Q3 2021, down from 6 funds in the prior quarter.
8. UroGen Pharma Ltd. (NASDAQ:URGN)
ARK Investment Management’s Stake Value: $4,107,000
Percentage of ARK Investment Management’s 13F Portfolio: 0.00%
Number of Hedge Fund Holders: 7
Market Capitalization: $245.278 million
UroGen Pharma Ltd. (NASDAQ:URGN) is a biopharmaceutical company from Israel, engaged in finding treatments for multiple cancers and urologic diseases, in addition to improving the therapeutic profiles of existing drugs. Cathie Wood, via ARK Investment Management, owns 244,165 shares in UroGen Pharma Ltd. (NASDAQ:URGN), worth $4.1 million at the end of the third quarter.
Of the 7 hedge funds that were bullish on UroGen Pharma Ltd. (NASDAQ:URGN) in Q3 2021, the leading stakeholder of the company is Jeffrey Jay and David Kroin’s Great Point Partners, with 750,000 shares worth $12.61 million.
According to earnings for the third quarter, published on November 15, UroGen Pharma Ltd. (NASDAQ:URGN) posted a loss per share of $1.35, missing estimates by $0.02. The $11.35 million revenue jumped 227.97% year-over-year, but missed estimates by $4.07 million.
Cathie Wood has been piling into relatively unknown names that could become big in the future, in addition to buying stakes in major companies like Tesla, Inc. (NASDAQ:TSLA), Roku, Inc. (NASDAQ:ROKU), Shopify Inc. (NASDAQ:SHOP) and Zoom Video Communications, Inc. (NASDAQ:ZM).
7. Enlivex Therapeutics Ltd. (NASDAQ:ENLV)
ARK Investment Management’s Stake Value: $4,523,000
Percentage of ARK Investment Management’s 13F Portfolio: 0.01%
Number of Hedge Fund Holders: 2
Market Capitalization: $119.79 million
Cathie Wood holds a $4.52 million stake in Enlivex Therapeutics Ltd. (NASDAQ:ENLV) as of September 2021, which represents 0.01% of her total Q3 investments. Enlivex Therapeutics Ltd. (NASDAQ:ENLV) is a clinical stage immunotherapy company that was founded in 2005 in Israel, focused on developing treatments for diseases such as solid cancers and sepsis.
The third quarter results were announced by Enlivex Therapeutics Ltd. (NASDAQ:ENLV) on November 19. The company posted a loss per share of $0.19, beating estimates by $0.02.
Enlivex Therapeutics Ltd. (NASDAQ:ENLV) announced that its ongoing sepsis and COVID-19 trials were recently granted authorization for expansion into sites in Spain, which positions the company to broaden its therapeutic impact while also providing important regulatory validation for its study designs and manufacturing process. Enlivex Therapeutics Ltd. (NASDAQ:ENLV) is working on the construction of a new manufacturing plant, which upon completion will allow larger clinical trials and commencement of commercial activity.
Enlivex Therapeutics Ltd. (NASDAQ:ENLV) is one of the best micro-cap stocks to buy according to Cathie Wood, with a market cap of $119.79 million.
In the third quarter of 2021, 2 hedge funds were long Enlivex Therapeutics Ltd. (NASDAQ:ENLV), with stakes valued at $5.39 million. This is compared to the same number of funds being bullish on the stock in Q2, with a total stake value of approximately $6.32 million. ARK Investment Management is the leading Enlivex Therapeutics Ltd. (NASDAQ:ENLV) stakeholder from Q3.
6. Exco Technologies Limited (OTC:EXCOF)
ARK Investment Management’s Stake Value: $5,247,000
Percentage of ARK Investment Management’s 13F Portfolio: 0.01%
Number of Hedge Fund Holders: N/A
Market Capitalization: $289.753 million
Headquartered in Markham, Canada, Exco Technologies Limited (OTC:EXCOF) is a company designing and developing components and assemblies for the automotive sector. Cathie Wood holds a $5.24 million position in Exco Technologies Limited (OTC:EXCOF) as of September this year, which represents 0.01% of her total investments for the third quarter.
Exco Technologies Limited (OTC:EXCOF) posted its Q3 results on December 1, announcing a GAAP EPS of $0.18. The quarterly revenue was up 5.6% year-over-year, amounting to $106.4 million.
Exco Technologies Limited (OTC:EXCOF)’s investors are due to receive a dividend payment of CA$0.10 per share on December 31, with the company offering a 4.3% forward dividend yield that is above the industry average.
Exco Technologies Limited (OTC:EXCOF) is a notable stock from Cathie Wood’s portfolio, in addition to Tesla, Inc. (NASDAQ:TSLA), Roku, Inc. (NASDAQ:ROKU), Shopify Inc. (NASDAQ:SHOP), and Zoom Video Communications, Inc. (NASDAQ:ZM).
5. Evogene Ltd. (NASDAQ:EVGN)
ARK Investment Management’s Stake Value: $10,653,000
Percentage of ARK Investment Management’s 13F Portfolio: 0.02%
Number of Hedge Fund Holders: 6
Market Capitalization: $84.387 million
Roth Capital analyst Brian Wright initiated coverage of Evogene Ltd. (NASDAQ:EVGN) on October 8 with a Buy rating and a $7 price target, citing the company’s robust pipeline of pre-clinical micro biome-based drug candidates in its biotech subsidiary and Evogene Ltd. (NASDAQ:EVGN) being on the cusp of commercialization of its first products in ag-biologics and cannabis.
A computational biology company engaged in product discovery and development in the life sciences industries like human health and agriculture, Evogene Ltd. (NASDAQ:EVGN) applies its technology platform, Computational Predictive Biology (CPB), leveraging big data and AI to guide the development of life sciences products by studying microbes, small molecules, and genetic elements.
Cathie Wood owns more than 4 million Evogene Ltd. (NASDAQ:EVGN) shares worth $10.65 million in the third quarter, representing 0.02% of her total 13F securities for Q3.
A total of 6 hedge funds monitored by Insider Monkey at the end of September were long Evogene Ltd. (NASDAQ:EVGN), with stakes valued at $13 million. Jim Simons’ Renaissance Technologies increased its position in Evogene Ltd. (NASDAQ:EVGN) by 155% in the third quarter, holding a $700,000 stake in the company.
On November 17, Evogene Ltd. (NASDAQ:EVGN) reported Q3 earnings, posting a loss per share of $0.19, missing estimates by $0.01. The quarterly revenue of $151,000 exceeded estimates by $39,000.
4. Conformis, Inc. (NASDAQ:CFMS)
ARK Investment Management’s Stake Value: $19,354,000
Percentage of ARK Investment Management’s 13F Portfolio: 0.04%
Number of Hedge Fund Holders: 8
Market Capitalization: $148.895 million
In the earnings results for the quarter ending September, posted on November 3, Conformis, Inc. (NASDAQ:CFMS) announced a loss per share of $0.07, missing estimates by $0.01. The $14.25 million revenue was down 11.59% year-over-year, but exceeded estimates by $108,000.
Conformis, Inc. (NASDAQ:CFMS) is a surgical and medical instrument manufacturing company from Massachusetts, specializing in customized hip and knee replacements.
Conformis, Inc. (NASDAQ:CFMS) is a new arrival in Cathie Wood’s Q3 portfolio, with ARK Investment Management holding 14.55 million shares of the company, worth $19.35 million. Conformis, Inc. (NASDAQ:CFMS) is one of the top micro-cap stocks to buy according to Cathie Wood, representing 0.04% of her total Q3 investments.
John Overdeck and David Siegel’s Two Sigma Advisors holds one of the leading positions in Conformis, Inc. (NASDAQ:CFMS) as of September this year, with 2.87 million shares worth $3.8 million. Overall, 8 hedge funds in the database of Insider Monkey were bullish on Conformis, Inc. (NASDAQ:CFMS) in the third quarter, down from 9 funds in the prior quarter.
3. Dynamics Special Purpose Corp. (NASDAQ:DYNS)
ARK Investment Management’s Stake Value: $23,132,000
Percentage of ARK Investment Management’s 13F Portfolio: 0.05%
Number of Hedge Fund Holders: N/A
Market Capitalization: $292.003 million
Dynamics Special Purpose Corp. (NASDAQ:DYNS) is a blank check company that was incorporated in March 2021, created for the purpose of carrying out multiple business combinations including mergers, share exchange, asset acquisitions, and corporate restructuring.
Cathie Wood, via ARK Investment Management, holds 3.32 million shares in Dynamics Special Purpose Corp. (NASDAQ:DYNS), worth $23.1 million at the end of September, representing 0.05% of the fund’s total Q3 portfolio.
Billionaire Daniel Sundheim’s D1 Capital Partners is one of the most prominent Dynamics Special Purpose Corp. (NASDAQ:DYNS) stakeholders from the third quarter, with 1.95 million shares worth $19.3 million.
2. AquaBounty Technologies, Inc. (NASDAQ:AQB)
ARK Investment Management’s Stake Value: $25,221,000
Percentage of ARK Investment Management’s 13F Portfolio: 0.06%
Number of Hedge Fund Holders: 6
Market Capitalization: $170.107 million
AquaBounty Technologies, Inc. (NASDAQ:AQB), one of the top micro-cap stocks to buy according to Cathie Wood, is a biotechnology company from Massachusetts known for its research and development of genetically modified fish. AquaBounty Technologies, Inc. (NASDAQ:AQB) is working to create products that increase the productivity of aquaculture.
ARK Investment Management holds a $25.2 million stake in AquaBounty Technologies, Inc. (NASDAQ:AQB) as of Q3 2021, which accounts for 0.06% of the hedge fund’s total investments for the quarter.
AquaBounty Technologies, Inc. (NASDAQ:AQB), on November 4, announced its Q3 results. The company posted a loss per share of $0.10, missing estimates by $0.03. The $455,400 revenue for the quarter also missed estimates by $242,100.
On November 9, H.C. Wainwright analyst Kevin Dede upgraded AquaBounty Technologies, Inc. (NASDAQ:AQB) to Buy from Neutral with a $4.50 price target, stating that the company addressed many questions and unknowns when reporting Q3 results.
At the end of the third quarter, 6 hedge funds reported owning stakes in AquaBounty Technologies, Inc. (NASDAQ:AQB), worth $27.5 million. This is compared to 4 funds being bullish on the stock in the preceding quarter, with the total stakes amounting to $41.2 million.
1. Surface Oncology, Inc. (NASDAQ:SURF)
ARK Investment Management’s Stake Value: $34,961,000
Percentage of ARK Investment Management’s 13F Portfolio: 0.08%
Number of Hedge Fund Holders: 12
Market Capitalization: $251.898 million
Surface Oncology, Inc. (NASDAQ:SURF) is the top micro-cap stock in Cathie Wood’s 13F portfolio for the third quarter, with Wood owning 4.61 million Surface Oncology, Inc. (NASDAQ:SURF) shares, worth $34.96 million, representing 0.08% of her total investments.
Surface Oncology, Inc. (NASDAQ:SURF) is a company focused on developing next generation immunotherapies targeting the immune-suppressive tumor microenvironment to combat cancer.
The third quarter earnings were published on November 4 by Surface Oncology, Inc. (NASDAQ:SURF), with the company reporting a loss per share of $0.44, missing estimates by $0.04.
In Q3 2021, 12 hedge funds reported owning stakes in Surface Oncology, Inc. (NASDAQ:SURF), worth $66.4 million. This is an increase as compared to 10 funds holding stakes in the company valued at $58.78 million in the preceding quarter.
Ken Griffin’s Citadel Investment Group is one of the biggest stakeholders of Surface Oncology, Inc. (NASDAQ:SURF), with 1.45 million shares worth more than $11 million.
You can also take a look at Echo Street Capital Management: Greg Poole’s Top 10 Stock Picks and 10 Dividend Stocks With the Potential to Grow.
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Disclosure: None. 10 Micro-Cap Stocks to Buy According to Cathie Wood is originally published on Insider Monkey.
