One of the biggest surprises of the recent rally in growth stocks is that Ark Invest CEO, chief investment officer, and founder Cathie Wood didn't make a lot of moves. She held firm, even completing no transactions on Friday of last week.
But Wood is buying again. Some of the more interesting additions to her portfolio on Monday were Roku (ROKU), Blade Air Mobility (BLDE), and UiPath (PATH). Let's take a closer look at her latest shopping haul.
We're streaming more than ever through Roku devices these days. There were a record 60.1 million active accounts at the start of 2022, 17% more than the number of families streaming through the country's top TV streaming operating system a year earlier. They streamed a record 19.5 million, up 15% over the past year.
Roku is a free platform, but its monetization skills keep improving at an impressive clip. Average revenue per Roku user has skyrocketed 43% over the past year.
Roku's popularity is surging, but that certainly doesn't happen to be the case with the stock. Roku shares have fallen 76% since peaking last year. Things aren't perfect at Roku. Supply chain constraints ate into its dongle production, and the push for unique content isn't cheap. Profit targets have been shaved sharply in recent months, but carving out market share is what really matters at this point in Roku's growth cycle.
Blade Air Mobility
Helicopters are taking off these days, and that's good news for Blade Air Mobility. The provider of high-end on-demand helicopter transport services saw its revenue more than triple in 2021. The $67.2 million in trailing revenue may not seem like a lot for a stock with a $578 million market cap, but its cash-rich balance sheet pushes Blade Air Mobility's enterprise value down to a modest $297 million.
Blade Air Mobility's monster growth last year was largely the handiwork of depressed 2021 results and a shrewd acquisition to establish a presence in human organ transportation. Its flagship short-distance helicopter business was actually flat last year with what it delivered two years earlier.
Is the model limited? Absolutely. However, there will always be a need for the affluent to get around quickly. Blade Air Mobility made a splash transporting folks to the Super Bowl with minimal traffic, and it's also there for remote music festivals. As long as rich people will trade money for time Blade Air Mobility will be just fine.
This would seem to be the right time for UiPath to step up. It provides enterprise software for companies to implement robotics and automation. With labor costs and other inflationary pressures on the rise one would expect more jobs to be handed to automated tech in the coming years.
The stock took a hit two weeks after the company posted disappointing fiscal fourth-quarter results. Revenue and earnings beat expectations, but guidance for the current quarter and for all of the new fiscal year fell short of what analysts were forecasting. UiPath seemed to have momentum with net new annual recurring revenue accelerating and its dollar based net retention rate clocking in at a healthy 145%. However the problematic guidance calling for a sharp sequential drop in revenue for the fiscal first quarter — and the top line expected to rise by no more than 22% for the new fiscal year after a 47% surge in the fiscal 2022 that ended in January — is difficult to ignore.
Thankfully for new investors a lot of that pessimism appears to be discounted. The shares are trading 77% below last April's all-time high of $90.
Roku, Blade Air Mobility, and UiPath were intriguing additions on Wood's shopping list on Monday. It will be interesting to see if she continues loading up on those out-of-favor growth stocks.
Should you invest $1,000 in Roku right now?
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Originally published on Fool.com
This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis – even one of our own – helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.
Rick Munarriz owns Roku. The Motley Fool owns and recommends Roku and UiPath Inc. The Motley Fool has a disclosure policy.