5 Stocks Cathie Wood is BUYING NOW!

Hey, welcome back subscribers to my world of stocks. My name is Ali and welcome back to our weekend institutional buyers series. This time we're going to be looking at the infamous Cathy Wood. It's a bit of a polarizing figure in the investing community because of her usually high focus on higher risk disruptive tech companies that are much more future oriented. So things like AI, robotics, advanced energy tech, gene editing, even space exploration and more. And because of it, well she often buys into businesses that do technically have a giant amount of future potential, but at the moment may be struggling with profitability and other growing pains that more traditional value oriented investors usually avoid. Well, regardless though, I find her trades to be some of the funnest to track because of all of those reasons and hey, maybe we'll even find a hidden gem among them sometimes, too. Plus, because she's one of the very few investors that immediately shares all of her trades as soon as she makes them, we can look at the biggest moves that she's made just from the past month alone, which is super fun, too. And so today we're going to run through five of the biggest purchases that she made over the past month which by the way, was worth around 200 million dollars, a giant amount of money in such a short window. And as always, I will be giving you guys my own opinion on each one of these along the way and I'll even rank them from best to worst, too, based on that opinion. So smash the like and the hype buttons down below. And by the way, if you want to get access to to my daily stock trades, then consider supporting me on Patreon. Link is down below. And for just five bucks a month, you get early commercial free videos, you get access to our community discord where you can hang out with other like-minded investors and you even get my daily stock purchase that I post every single day. So I'd love to see you on there, but thank you so much to our amazing members that do support the channel this way. Couldn't do this without you. With all that said, let's just go ahead and jump straight into this list. All right. Now, coming in at purchase number one, well, surprisingly, this one is actually not speculative at all in my opinion. In fact, it's usually considered one of the highest quality, most promising biotechs in the entire market right now. And that is Eli Lilly, ticker symbol LLY, uh which Cathie poured a staggering 96 million dollars into over the past month alone. Now, uh the interesting thing about Lilly is just how on fire their business has been with tremendous growth on both the top and bottom line that you just don't typically get from, you know, other legacy pharma giants. And because of it, really because of all of that growth that Lilly tends to experience, well, the stock has skyrocketed in price as investors flooded into it. It's actually risen by over a thousand percent uh in the past decade. And it's even uh broken north of a trillion-dollar market cap, which is pretty crazy for a biotech. Now, the reason for all of that growth is very simple. A large portion of it, for sure, is being driven by their dominance in the GLP-1 weight loss and diabetes market, which has been all the craze lately, which Morgan Stanley projects to more than double in size, maybe even triple over the next decade. Where, according to a recent Gallup poll, well, 11% of US adults are already taking GLP-1 medications, and Eli Lilly holds a massive 60% share of that US market. And just the first quarter alone, for example, their blockbuster drugs Mounjaro and Zepbound brought in a combined 12.9 billion dollars, pushing their total quarterly revenue up a mind-blowing 56% year-over-year, with management even raising their full-year guidance up to 85 billion, too. Uh but the biggest catalyst for their next leg of growth is really going to be accessibility. So, back in April, the FDA approved Zepbound, which is uh Lilly's new oral GLP-1 weight loss pill that removes many of the traditional barriers like cold chain logistics and self-injections. A patient can just take a daily pill now, which starts at around 150 bucks a month out of pocket and can ship directly through Lilly's uh It's called Lilly Direct. It's their direct-to-consumer platform. In fact, the company projects so much demand for this that they're even spending another 27 billion dollars to create four new manufacturing sites in America. And they're even negotiating new deals where Medicare users, for example, may be able to pay as little as just 50 bucks a month for these treatments, which would likely send demand soaring even higher than it already is. As for me, though, I don't personally own the stock just because I really prefer the dirt-cheap valuations and the sky-high dividends that I can get from some of the other lower-growth legacy players in the space who I also just think have more kind of rebound potential in price. Whereas Lilly, uh with them, I just think that most of the gains have likely been already realized, which most analysts agree with, by the way, on average if you look at like price targets. And I also just feel that, you know, a lot more companies are going to slowly be entering the weight loss space, too, and with Lilly being by far the market share leader, I just I could see them I could see a lot of other companies kind of stealing some of that market share. It's not to say that it they're going to dethrone Lilly or it's a huge threat to them, but I just think over time, you're going to see competition really start to ramp up in the space. Everyone wants to enter the weight loss market, all the biotechs, all the pharma giants. Uh but I have to admit that so far I have been completely wrong about Lilly's stock, and because of their explosive growth, well, their forward PEG ratio is actually still somehow cheaper than the sector, if you can believe it. Although, their more current metrics are much higher. But, for those reasons, I think I have to rank them pretty high for now at number two. At least until we see what else is on this list, the other stocks, and then maybe I'll adjust it from there. But, >> [snorts] >> uh moving on to purchase number two, though, what we have what is probably the most talked about stock in the entire market right now. It's a red-hot one. Some might argue that it's maybe the most kind of overhyped, but it's also been falling in price. Anyway, I'm talking about SpaceX, ticker symbol SPCX, which Cathie went so crazy on at over $67 million of purchases which is most recently that she was even selling many stocks around the IPO time, too, just so she could buy more of the stock. And the purchases are actually much higher than this in total, by the way. Uh but, yeah, this is a pretty crazy crazy one here, crazy stock. It was actually the largest IPO in history, soaring in price before crashing back down, where it's now lost around 35% of its value from the top, and it's even slightly negative since IPO. Uh yet, even after that fall, their market cap is still sitting at a staggering close to $2 trillion market cap, which is pretty crazy for how much kind of, you know, smaller they generate in in terms of sales and profits um that they did last year. However, those numbers should be multiplying many times over in the coming years, as SpaceX is really no longer just a space company, but rather it is quickly becoming an AI giant. One that not only owns XAI, but that also took advantage recently of all those newly minted public shares to acquire the AI coding startup Cursor in a huge $60 billion all-stock transaction. Now, for those that don't know, Cursor is basically an agentic AI coding tool. One that doesn't just auto-complete lines of code, but rather it actively generates, edits, and reviews entire blocks of software architecture. And it's capable of accelerating all their engineering at massive scale. And it's been doing a great job of that so far. In fact, it's become so popular that major tech companies like OpenAI, DataDog, Adobe, and even Nvidia all use Cursor themselves. Well, by bringing it in-house now under the SpaceX, you know, kind of corporate umbrella, well, they'll not only greatly advance their XAI operations, but they'll be able to license out much of this technology at huge scale, too. For which they estimate that their total market opportunity will be north of 28 trillion dollars, with 26 trillion alone coming from just AI, and 22 trillion of that coming specifically from enterprise applications. And while that might sound like an unrealistic figure, we are at least seeing some rising demand here, as they're even leasing out some of their land-based data centers, too, to tech giants like Google and Anthropic for 2.2 billion dollars a month, which is 26 billion annually. Guys, that data center revenue alone is more than the 18.7 billion that SpaceX generated in total sales for all of last year. In other words, AI is really where the biggest amounts of money are likely going to be coming from in the foreseeable future. And it's why Goldman Sachs themselves is projecting their AI division could grow to 322 billion by 2030, driving total company revenue to 474 billion. I mean, these numbers are just getting like pretty insane. Uh still though, it's not a stock that I've purchased myself. And most of it is tied to just the valuation, the fear of it still being a bit too high for what is projected to still come in in their future. Uh for me personally, I would either want an even bigger dip on the price or at least a couple years of public performance to track how well they're doing and um how they're executing on some of their goals before buying into the stock. But I have to admit that this is really becoming one of the most tempting stocks on the market to take a chance on. So I fully understand why some have as well. And while I'm sure many of you will call me crazy for ranking it this high on our list, I am actually going to put them above Eli Lilly for one simple reason. Look, Lilly is obviously the much safer, more stable, and probably predictable stock to be betting on here with the cheaper valuation. But given that I'm not buying either stock anyway, if I had to take shares of one of these two companies, I would actually just prefer taking the SpaceX shares for what they could potentially become in the future. I think Lilly has the higher floor, but I think SpaceX has the higher ceiling. And because I already have such a safe, well-rounded portfolio to begin with, I would just rather take a chance on the higher ceiling opportunity with the more exciting business in space exploration and AI instead of the higher floor in a more boring pharmaceuticals company that again, I already own several pharmaceuticals anyway, so. Anyway, that's just me though, but with that said, let's go ahead and move on to the next one. So, uh while we haven't come across a stock yet that I own myself, um purchase number three is in fact that. And uh that's going to be in the fintech giant, actually my favorite fintech stock in the entire market, in SoFi Technologies. Ticker symbol SOFI, uh which Cathie deployed about $7 million into this past month, too. Now, if you've been watching this one lately, uh you know that it's been a bit of a bumpy ride with shares down close to half their value from the top. And there's a few reasons for this, like some short seller allegations and even the discontinued use of their tech platform by another mobile banking fintech called Chime, which caused that specific segment to see a 27% drop in sales last quarter. And so Wall Street did what it always does as investors panicked and sold out of the stock. But in my opinion, the market completely lost perspective on the bigger picture here. For example, if you look past that single Chime speed bump, uh SoFi's total revenue actually soared still by over 40% year-over-year. And they also added a record-breaking 1.1 million new customers, causing their EPS to literally double in size. That's hardly the type of performance that you'd expect from a cash uh crashing stock price. But rather, SoFi continues to fire on all cylinders, and they're closer than ever at becoming that ultimate all-in-one platform for all finances. Uh they also have national a national bank charter uh now that is allowing them to hold their own member deposits to fund their loans, a huge deal. It greatly lowers their cost of capital compared to other fintech peers. Uh they're aggressively pushing into AI. They actually just recently acquired Composer, which is an AI-native investing agent that allows users to build and automate complex trading strategies using simple text prompts. And they're cross-selling more products and services than ever before, too, with nearly half of all their members now utilizing multiple products, making their user base incredibly sticky and highly profitable. And the result being high growth in both the top and bottom line with still a P/E ratio that sits below sector levels, too. Even though, by the way, that sector is notoriously low to begin with because of all of the low-growth legacy banks. So, for a growth-oriented fintech to actually be trading significantly lower than even that, I think it's an absolute steal in my opinion at these levels. And so I've been loading up on shares myself, and uh yeah, they're easily going to take the the one ranking on this list. All right, now we're down now to the final two pickups here. And coming in at purchase number four, well, we actually have a big AI energy play. One that even Amazon is buying up shares of two. Super interesting. And that is X-energy, ticker symbol XE, which Cathie invested about $20 million into more dollars into this month. Now, for those that don't know, this company actually just went public a few months ago, back in I think April. And so, it's actually been a pretty rough ride since then, losing over half its value during that time. Now, despite that terrible performance, though, X-energy has actually received huge backing from the biggest cloud provider in the world in Amazon, who even owns around a quarter of the entire company themselves, and are partnered to produce 5 GW of power from them over the next decade. And so, the bullish thesis, I must admit, is a pretty compelling one. That with the global explosion of AI use, well, energy demand from data centers is projected to skyrocket by more than five times larger by 2030. And with tech giants now realizing that solar and wind simply not be nearly reliable enough to provide the 24/7 power needed to run all of these massive AI superclusters, well, advanced nuclear energy is increasingly being viewed as the only viable carbon-free solution to solve this looming energy crisis. Now, for which X-energy happens to specialize in with small modular reactors, they're more versatile than the massive legacy ones, and can be deployed wherever needed at much lower cost. And these specific ones even run on their own proprietary TRISO-X fuel, which uses ceramic-coated particles that literally can't even melt, thus making nuclear meltdowns virtually impossible now. Hence why companies like Amazon, Dow, and others have been lining up to sign future contracts with them. Now, the keyword there, though, is future, because at the moment XE doesn't have a single reactor online with even their earliest products not releasing until probably 2030 the earliest. And so even though I can see the huge future potential in them, I just can't bring myself to rank this one any higher than the more proven companies that we've already seen on this list. I think it could be a great spec play though, but not so much as a very safe kind of investment. It's more of a speculative play. All [snorts] right, guys. Now believe it or not, there's actually one more stock here that I do own myself in my own portfolio too besides SoFi that also made this list. And that is the super risky, highly highly speculative Recursion Pharmaceuticals ticker symbol RXRX which Cathie purchased another 10 million more dollars of in the month for which as you can see Recursion is essentially now just a penny stock after having lost close to 90% of its entire value all time. Now to be clear, I bought my shares after most of that crash, but um that also places us in good position here to evaluate the stock at today's current levels for which again, I just think that this is a super risky speculative stock that should only be treated as such. It's not an actual investment, it's a spec play for what could be in the future. And what that technology is is in using AI for pharmaceutical development. See currently it's estimated that bringing a single drug to market usually costs an average of around one to two billion dollars. Mostly because nine out of the 10 uh drugs being developed that enter clinical trials ultimately end up failing and that's a huge burden on these companies. Well, Recursion is hoping to fix much of that by using the most powerful biotech supercomputer in the world which they actually built in partnership with Nvidia that uses over 50 petabytes of biological data to continuously run virtual experiments and identify new treatments. Obviously the upside for this is huge and it's why other pharma giants like Roche, Bayer, Merck, and Sanofi have all partnered with Recursion to actually use their AI-powered platform. However, the hesitation for many, rightfully so, comes down to their current financials. The company still does not have any approved medicines on the market quite yet. They're still burning through tons of cash to run their trials. And while there are at least some promising signs, like their recently announced clinical proof of concept for a drug candidate called REC-4881, showed a giant 43% reduction in precancerous polyps for a rare genetic disease, the fact is that if you own this stock, you're kind of left with the ultimate risk of the company potentially going bankrupt in the future if they completely run out of cash. Again, I own the stock, so I obviously don't expect that to happen. But I know the risk that I'm taking with it, which is why I only own a very tiny amount compared to the rest of my portfolio, at less than 1% weight. But I will still rank them above X Energy by default since I do actually own some shares myself. But hey, there you have it, guys. Those are my final rankings for RX's big new buying spree. Personally, I think it's a bit of a mixed bag. I really like SoFi, but the others are a bit too high risk for my taste. But I'm curious what you all think about these down below. Do you agree with my rankings? Would you make any changes to them? I'd love to hear your thoughts down in the comments and let me know if you own any of these stocks yourselves, too, and why or why not. But hey, either way, I hope you enjoyed the video and I thank you so much for stopping by and for all of your support. It means a lot to me. Hope you're all doing well and I'll catch you guys in the next one. All right, take care, my friends. Bye-bye. >> [music]