Cathie Wood Makes $13.4 Million Bet On This Social Network After Earnings Crash — But Dumps Robinhood And Reddit

Cathie Wood-led Ark Invest made significant trades on Wednesday, focusing on Pinterest Inc. (NYSE:PINS), Robinhood Markets Inc. (NASDAQ:HOOD), and Reddit Inc. (NYSE:RDDT). These trades come amid notable earnings reports and market reactions.

The Pinterest Trade

On Wednesday, Ark Invest made a substantial move by purchasing shares of Pinterest across multiple ETFs, including Ark Fintech Innovation ETF (BATS:ARKF), ARK Innovation ETF (BATS:ARKK), and ARK Next Generation Internet ETF (BATS:ARKW). In total, Ark acquired 521,867 shares of Pinterest, valued at approximately $13.43 million, given the closing price of $25.75. For the day, Pinterest’s stock dropped 21.8%.

This purchase follows Pinterest’s recent earnings release, which saw the company’s stock plunge due to missing earnings estimates despite a 17% revenue increase and record user growth. The acquisition likely suggests Ark’s confidence in Pinterest’s long-term potential despite short-term setbacks. Pinterest reported third-quarter revenue of $1.05 billion, in line with estimates, and adjusted earnings of 38 cents per share, missing expectations of 42 cents. Revenue rose as global monthly active users hit a record 600 million, up 12%. The company generated $322 million in operating cash flow and ended the quarter with $1.13 billion in cash.

The Robinhood Trade

Ark Invest reduced its stake in Robinhood Markets by selling 56,095 shares through the ARKK ETF, amounting to roughly $7.99 million based on the closing price of $142.48.

This decision comes after Robinhood reported strong third-quarter earnings, surpassing revenue and earnings expectations. The trading platform posted record third-quarter revenue of $1.27 billion, doubling year-over-year and beating Wall Street estimates of $1.19 billion. Earnings of 61 cents per share also topped expectations of 48 cents. Transaction revenue surged 129% to $730 million on strong crypto, options, and stock trading, while the platform attracted record net deposits of $20 billion and grew its customer base 10% to 26.8 million users.

The Reddit Trade

Ark Invest also trimmed its position in Reddit by selling 11,989 shares through the ARKW ETF, worth approximately $2.35 million at the closing price of $196.27.

Reddit’s shares have been on the rise following its impressive third-quarter earnings report, which exceeded both revenue and earnings estimates. Reddit reported quarterly earnings of 80 cents per share, beating estimates of 52 cents, and revenue of $585 million, above the $545.71 million consensus. Daily active uniques rose 19% to 116 million, while ad revenue jumped 74% to $549 million. Adjusted EBITDA climbed to $236 million, and free cash flow improved to $183 million for the reported period.

Other Key Trades

• Guardant Health Inc.: Purchased 33,823 shares through ARKG.
• Roku Inc.: Sold 105,576 shares through ARKK.
• SoFi Technologies Inc.: Sold 60,808 shares through ARKF.

Benzinga’s Edge Stock Rankings indicate Reedit has a Value in the 6th percentile. Here is how it compares with Wood’s other social media holding, Pinterest.

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Photo Courtesy: PJ McDonnell on Shutterstock.com

This story was generated using Benzinga Neuro and edited by Shivdeep Dhaliwal