Cathie Wood is Giving Up on These 5 Tech Stocks

In this article, we discuss 5 tech stocks that Cathie Wood is giving up on. If you want to see more stocks in this list, click Cathie Wood is Giving Up on These 9 Tech Stocks. 

5. Okta, Inc. (NASDAQ:OKTA)

Number of Hedge Fund Holders: 46

Percentage Decline in the Stake: 61%

Okta, Inc. (NASDAQ:OKTA) is headquartered in San Francisco, California, offering cloud-based identity solutions. The company provides Okta Identity Cloud, which offers a suite of products and services such as Universal Directory, Adaptive Multi-Factor Authentication, Lifecycle Management, API Access Management, Access Gateway, Advanced Server Access, and Universal Login. Cathie Wood dumped 61% of her previously held Okta, Inc. (NASDAQ:OKTA) stake in the second quarter of 2022. The ARK portfolio had 83,316 shares of the company at the end of June, worth about $7 million. 

On July 19, Bernstein analyst Peter Weed initiated coverage of Okta, Inc. (NASDAQ:OKTA) with a Market Perform rating and a $94 price target. The analyst observed that Okta, Inc. (NASDAQ:OKTA) has been an “exciting” near 40% organic growth story before, during, and after the pandemic. The analyst added that this organic growth was achieved before the swift growth driven by the company’s acquisition of Auth0.

According to Insider Monkey’s data, 46 hedge funds were bullish on Okta, Inc. (NASDAQ:OKTA) at the end of Q1 2022, down from 52 funds in the prior quarter. Christopher Lyle’s SCGE Management is the leading stakeholder of the company, with 1.78 million shares worth about $270 million. 

Here is what Lakehouse Capital has to say about Okta, Inc. (NASDAQ:OKTA) in its Q2 2021 investor letter:

“The Fund held 20 positions as of the end of June and exited four during the year (including) Okta. The companies we exited were sold almost entirely on the basis of their valuations getting stretched well past their norms and to levels where the return profile no longer offered the asymmetric upside that led us to invest in the first place. We dislike selling on valuation as great growth companies are hard to find and letting winners run is an important facet of a winning growth strategy, however, we’re not gluttons for punishment either and in each of those cases we redeployed capital towards other high-quality growth companies with less demanding valuations.”