Investing guru Cathie Wood remains an investor favorite. Although the founder of the ARK Invest family of exchange-traded funds (ETFs) lost to the market in 2024, it was not an even performance.
Where her flagship ARK Innovation ETF (NYSEARCA:ARKK) only gained 12% last year versus the 24% rise by the S&P 500, her ARK Next Generation Internet ETF (NYSE:ARKW) trounced the index by rising 50%. It was similar across her other ETFs with some big home runs and just as large strikeouts.
That’s because Wood likes to make big swings on her big ideas. Every year the popular multi-millionaire investor lays out her roadmap on what she believes will be transformational investments in her “Big Ideas” monograph. Whether it is genomics, precision therapeutics, or artificial intelligence, her ETFs typically reflect those beliefs.
24/7 Wall St. Key Points:
- Investing guru Cathie Wood has developed a large following due to her willingness to make big bets on innovative companies across her family of ARK Invest ETFs.
- Seeking out companies that can dramatically alter our lives, Wood takes big swings. It means she will strikeout a lot, but connect for major home runs, too.
- If you’re looking for some stocks with huge potential, make sure to grab a free copy of our brand-new “The Next NVIDIA” report. It features a software stock we’re confident has 10X potential.
Many times these are often nascent technologies and paradigm shifts, so they will take time to take root. Wood is willing to take an early position and wait for them to flourish, even though her trading activity is frenetic with daily buys and sells.
Below are two stocks she went big on in the third quarter. Let’s see whether they deserve a spot in your portfolio too.
Tempus AI (TEM)
Healthcare-focused AI stock Tempus AI (NASDAQ:TEM) was the stock she went after hardest last quarter. New to the market with an IPO last June, Tempus AI is building an AI-enabled diagnostics platform for doctors, drug companies, and patients by collecting real-time clinical, molecular, and imaging data on millions of patients. Its proprietary software then uses that data from over 2,000 institutions to train its large language models (LLM). It says its platform is 50 times larger than The Cancer Genome Atlas (TCGA).
Tempus AI’s tools allow doctors to see how similar patients have been treated, lets drug companies derive insights to accelerate innovation and drug development, and can help providers find patients that match endpoint goals in clinical trials almost in real time.
The AI shop has quickly grown to a $5.9 billion market capitalization, but its stock, which went public at $37 per share, is essentially flat. There have been several spikes in the stock, with shares hitting $79 each after reporting earnings in November, but it has tumbled since. But TEM stock us up 11% so far in 2025.
Wood took a 30,000-share position in October ahead of earnings and has continued buying the stock ever since. It is now the sixth largest holding in her ARK Genomic Revolution ETF (NYSEARCA:ARKG) and the ninth biggest position in the ARK Innovation fund. She owns a combined 2.38 million shares worth almost $135 million.
Wall Street has a buy rating on Tempus AI with a $56 per share one-year price target, implying 49% upside in the stock.
Amazon (AMZN)
The second stock Wood began buying hand over fist is Amazon (NASDAQ:AMZN), and it is fairly surprising that she hasn’t owned any shares previously. But she now owns the internet retailer and cloud services giant across five of her six ETFs and it is the 16th largest holding overall.
Amazon, of course, has been the leading cloud provider based on the company’s early entry into the space. Amazon Web Services has long been the e-commerce giant’s profit center and it remains so today. The application of AI to its cloud offerings is accelerating AWS growth.
Despite enhanced competition from Microsoft‘s (NASDAQ:MSFT) Azure and Alphabet‘s (NASDAQ:GOOG)(NASDAQ:GOOGL) Google Cloud, segment sales in the third quarter increased 19% year-over-year to $27.5 billion. It remains the largest cloud services platform with a better than 50% share.
Amazon president and CEO Andy Jassy told analysts, “We’ve seen significant reacceleration of AWS growth for the last four quarters,” and pointed to Nivida (NASDAQ:NVDA) choosing AWS to partner with for its R&D supercomputer.
The internet giant only achieved in a $2 trillion valuation in June of last year, but is worth $2.3 trillion today and should readily cross the $3 trillion valuation threshold later this year, a 50% return in just a year or so..
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