Cathie Wood Engages in Discount Shopping: Three Stocks She Recently Purchased
In the current market climate, while numerous indexes are reaching record highs, several stocks aren't sharing in the bullish trend. Two notable examples are Pinterest (PINS -2.04%) and GitLab (GTLB), which are more than 30% below their 52-week highs. PayPal (PYPL 3.80%) also hovered at its 52-week high, but it would need a substantial leap to match its all-time peak. All three of these companies are part of Cathie Wood's Ark Invest collection of ETFs, and she added to these investments on Monday.
Let's delve into these three new additions to Wood's Ark Invest portfolio.
1. Pinterest
Pinterest's fortunes have been a mixed bag. On the positive side, Pinterest has successfully overcome the post-pandemic slump that many users experienced in 2022. In fact, growth is picking up pace for a second consecutive year. The platform's year-over-year revenue growth has climbed in five out of the past six quarters, with top-line gains exceeding 20% in the first half of 2025. Pinterest's global audience has swelled by 12% to a record 522 million active users. Meanwhile, adjusted earnings per share rose an impressive 38% in its latest earnings report.
However, the most recent guidance from Pinterest was underwhelming. The company expects revenue in the current quarter to range from $885 million to $900 million, marking a decline in year-over-year growth to between 16% and 18%. This fell short of analysts' expectations. However, Pinterest has a history of underestimating its growth potential. During the second quarter of 2022, Pinterest projected a 15% increase in revenue, but it actually delivered a 21% jump instead. Additionally, Pinterest seems to be making strides in addressing its monetization challenges, as evident in the 8% growth in average revenue per user in its latest earnings report.
2. PayPal
PayPal has been in the headlines for the wrong reasons. In 2024, rumors swirled that the fintech giant was considering purchasing Pinterest for $70 per share. The move was met with disapproval from PayPal shareholders, which led to the company announcing that it would no longer be pursuing a Pinterest acquisition. With Pinterest trading at around $30 per share today, it appears that a missed opportunity may have cost Pinterest dearly. Still, PayPal's stock has experienced a significant decline since the initial rumors, with shares falling by more than two-thirds in the past three years.
PayPal's recent performance has been lackluster, posting seven consecutive quarters of marginal growth. But the silver lining is that PayPal is increasingly appealing to value investors due to its reasonable stock valuation, with an earnings multiple in the teens. Other fintech companies may be growing faster, but PayPal's established presence and $5 billion in annual free cash flow ensure it will persist as a force in the market, with 429 million active users and growing total payment volume.
3. GitLab
Considering GitLab's recent financial performance, it's surprising to see its shares trading near their 52-week lows. On March 8th, 2025, the cloud-based software development platform operator delivered a strong quarterly earnings report, surpassing Wall Street targets by 50%. Despite revenue growth slowing slightly, it is still growing at an impressive annual rate of better than 30%.
Although GitLab's stock isn't cheap, trading at more than 100 times its projected fiscal-year earnings, the company's healthy momentum and promising offerings in AI-assisted software development are attracting interest. Wood has shown her confidence in GitLab, as she recently added to her position.
In conclusion, while PayPal is currently underperforming and trading at a discount, its loyal user base and substantial free cash flow make it an appealing target for value investors. Pinterest and GitLab, on the other hand, have shown impressive growth and strong quarterly results, making them ripe for long-term investors looking for high-growth opportunities.
- To manage their investments efficiently, Cathie Wood might consider analyzing the financial performance of her holdings, such as GitLab, which recently reported a strong quarter with revenue growth exceeding 30%, despite its stock trading at a high multiple.
- For those interested in diversifying their portfolio and focusing on investing in high-growth opportunities, Pinterest and GitLab could be attractive choices. Despite Pinterest's recent guidance falling short of analyst expectations, its user base and revenue growth have shown signs of recovery, while GitLab's strong quarterly earnings report and focus on AI-assisted software development have maintained investor interest.
