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Three Top Tech Stocks Recommended by Cathie Wood of Ark Invest

Three top tech stocks recommended by Cathie Wood, the chief executive officer of New York-based Ark Investment Management LLC, are climbing. The three…

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4 months ago

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Three top tech stocks recommended by Cathie Wood, the chief executive officer of New York-based Ark Investment Management LLC, are climbing.

The three top tech stocks recommended by Cathie Wood are key holdings in the ARK Invest flagship fund, Ark Innovation ETF (ARKK), featuring a video streaming company, an innovative electric vehicle manufacturer and a cryptocurrency exchange platform. All are showing strong upward momentum, said Wood, who acknowledged receiving criticism from the CNBC business news television channel, CNBC, for aligning her investment firm’s focus on the long-term growth of the disruptive innovation in technology sector rather than short-term trades.

Chart courtesy of www.stockcharts.com

One of the three top tech stocks to buy is Roku Inc. (NASDAQ: ROKU), a San Jose, California-based streaming service that seeks to provide users with content they love and advertisers with unique ways to engage with consumers. The company offers Roku TV models, streaming players and TV-related audio devices that are available in various countries around the world through direct sales and licensing arrangements with original equipment manufacturer (OEM) brands.

Three Top Tech Stocks Recommended by Cathie Wood: Roku

Roku zoomed more than 30% on Thursday, Nov. 2, due to its strong earnings report that day, Wood told me when I interviewed her at the COSM Technology Summit in Seattle that evening. Roku offers a “streaming platform” and finally people are starting to understand that it does not compete with Netflix Inc. (NASDAQ: NFLX), she added.

Paul Dykewicz interviews Cathie Wood at COSM.

Roku, a digital video company, reported revenue of $912 million for third quarter 2023, ended Sept 30, beating Wall Street analysts’ estimates of $857 million. In addition, Roku’s management offered guidance of fourth-quarter revenue reaching about $955 million, a bit more than the $952 million analysts that are expecting, according to FactSet.

Roku branded televisions and Roku Smart Home products are sold exclusively in the United States, while the company operates its Roku Channel as the home of free and premium entertainment with exclusive access to Roku Originals. The Roku Channel is available in the United States, Canada, Mexico and the United Kingdom.

Three Top Tech Stocks Recommended by Cathie Wood: Tesla

Her second top technology stock right now is Austin, Texas-based Tesla Inc. (NASDAQ: TSLA), a stock she has championed for several years through good and bad times as founder Elon Musk has persevered amid adverse circumstances. Tesla has become a world leader in producing electric vehicles (EVs).

Chart courtesy of www.stockcharts.com

“We really do believe that now that GM and Ford are backing away from EVs, as they can’t make them profitably… market share is opening even more for Tesla,” Wood said. “Then, on top of that, we believe that the autonomous taxi opportunity is probably going to be theirs to win.”

Tesla has collected more “real-world driving data” than all the other vehicle manufacturers put together worldwide, Wood continued. The Musk-led company has 5,000 robots, including a Model 3 and a Model Y that Wood told me she personally is driving to help Tesla collect data about the roads that she traverses, as well as all that can go wrong on the roads.

“Tesla, we believe, is in the pole position to become the biggest investment opportunity that is out there today,” Wood told me.

Worldwide, electric vehicles will become an $8-$10 trillion-dollar revenue opportunity, Wood opined. That equals roughly 10% of the U.S. gross domestic product (GDP), she added.

“We’re really excited about that one,” Wood said.

Three Top Tech Stocks Recommended by Cathie Wood: Fast Money

Telsa produced big profits in several of the trade recommendations from Mark Skousen, PhD, and stock pick Jim Woods in the Fast Money Alert advisory service that they lead together. The tandem has recommended Tesla several times, but the best results came during 2020 when the company’s financial survival was in jeopardy.

Mark Skousen is a co-head of Fast Money Alert.

They recommended the purchase of Tesla stock and options in 2020. An average gain of 404% was attained by Fast Money Alert subscribers who followed instructions to purchase call options and then sell them in two separate segments for profits of 579.4% and 428.6%, respectively.

Jim Woods is a co-head of Fast Money Alert.

Three Top Tech Stocks Recommended by Cathie Wood: Coinbase

Coinbase Global, Inc. (NASDAQ: COIN), originally based in San Francisco, is a cryptocurrency trading platform that now describes itself as a remote-first company. It gives investors a chance to access the broader crypto economy beyond just bitcoin.

Chart courtesy of www.stockcharts.com

With $114 billion in assets, Coinbase employs more than 3,400 people and operators in 100-plus countries. With its extensive international reach, Coinbase is positioned to become involved in crypto worldwide.

“We think Coinbase is spreading its wings around the world and that it will get into everything crypto,” Wood said.

Coinbase is known as an exchange, but it also offers a digital wallet, Wood said. She continued that Coinbase should be expected to become involved in all kinds of financial services that the crypto community calls DeFi, or decentralized finance, an umbrella term for peer-to-peer financial services on public blockchains.

“We’re pretty excited about that as well,” Wood said.

Three Top Tech Stocks Recommended by Cathie Wood: Bitcoin Boost

Another driver of opportunity for Coinbase could be a rebound in bitcoin.

Interestingly this year, bitcoin became a risk-off asset as a flight to safety occurred amid market uncertainty with interest rates rising and some regional banks failing.

Seasoned Wall Street trader Bryan Perry recommended Coinbase in August for his Hi-Tech Trader subscribers and advised the sale of the shares less than three months later for a profit of 5.35%. He also recommends options in Hi-Tech Trader and still has such a Coinbase trade outstanding that has yet to close.

Bryan Perry heads the Hi-Tech Trader advisory service.

Three Top Tech Stocks Recommended by Cathie Wood: Bitcoin Bump

Bitcoin shot up earlier this year from $19,000 to $30,000 because there is no counter party risk in bitcoin like there is in the regional banking system, Wood said.

Wood expects the U.S. Securities and Exchange Commission will soon approve a bitcoin exchange-traded fund. That will be a key signal to validate bitcoin, she added.

Bitcoin still has its critics. One of them is Professor Dennis Ridley, an economist who has faculty positions at both Florida State University and Florida A&M University. Professor Ridley was a panelist at the COSM Technology Summit with George Gilder, co-founder and senior fellow at the Discovery Institute and head of the Gilder’s Technology Report investment newsletter.

“I do not trust Bitcoin,” Professor Ridley said. “I hope we can return to the gold standard.”

Gilder personally owns bitcoin, but he focuses on his passion of technology investing as one of the world’s foremost futurists. His Gilder’s Technology Report is a monthly publication but it is supplemented with updates in the weeks when the newsletter is not sent to his subscribers.

Paul Dykewicz meets with George Gilder, head of Gilder’s Technology Report.

Political Risk Mounts with Wars in the Ukraine and the Middle East

Even though the three technology investments to buy rebounded in the first part of 2023 after the sector fell more than 30% in 2022, they slid again in recent months before perking up lately. Investors need to withstand headwinds of higher-for-longer interest rates, runaway federal deficits and rising political risk with Russia’s unrelenting war in Ukraine amid escalating attacks in the Middle East following the murderous Oct. 7 rampage by Hamas inside Israel.

President Joe Biden invoked the Defense Production Act on Oct. 30 in a technology-related executive order only meant to be issued in the most urgent of moments, such as mobilizing the nation during war time or developing COVID vaccines amid a pandemic. His executive order about artificial intelligence (AI) applied the same authority to make companies prove that their most powerful systems are safe before allowing their use.

That means companies must tell the government about the large-scale AI systems they’re developing and share rigorous independent test results to prove they pose no national security or safety risk to the American people, President Biden said. At the same time, President Biden said he would direct the Department of Energy to ensure AI systems don’t pose chemical, biological, or nuclear risks.

In the wrong hands, AI can make it easier for hackers to “exploit vulnerabilities” in the software that makes American society run, President Biden said.

For that reason, President Biden said he was directing the Department of Defense and the Department of Homeland Security to develop “game-changing cyber protections” that will make computers and critical infrastructure more secure than today. As part of that response, President Biden said his administration would take “decisive steps” to prevent the use of cutting-edge AI chips that could undermine U.S. national security, he added.

Paul Dykewicz, www.pauldykewicz.com, is an award-winning journalist who has written for Dow Jones, the Wall Street Journal, Investor’s Business Daily, USA Today, the Journal of Commerce, Crain Communications, Seeking Alpha, Guru Focus and other publications and websites. Paul can be followed on Twitter @PaulDykewicz, and is the editor and a columnist at StockInvestor.com and DividendInvestor.com. He also serves as editorial director of Eagle Financial Publications in Washington, D.C. In that role, he edits monthly investment newsletters, time-sensitive trading alerts, free weekly e-letters and other reports. Previously, Paul served as business editor and a columnist at Baltimore’s Daily Record newspaper and as a reporter at the Baltimore Business Journal. Plus, Paul is the author of an inspirational book, “Holy Smokes! Golden Guidance from Notre Dame’s Championship Chaplain,” with a foreword by former national championship-winning football coach Lou Holtz. The uplifting book is a great holiday gift and is endorsed by Joe Montana, Joe Theismann, Ara Parseghian, “Rocket” Ismail, Reggie Brooks, Dick Vitale and many other sports figures. To buy signed and specially dedicated copies, call 202-677-4457.

The post Three Top Tech Stocks Recommended by Cathie Wood of Ark Invest appeared first on Stock Investor.

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February Employment Situation

By Paul Gomme and Peter Rupert The establishment data from the BLS showed a 275,000 increase in payroll employment for February, outpacing the 230,000…

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2 hours ago

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March 9, 2024

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By Paul Gomme and Peter Rupert

The establishment data from the BLS showed a 275,000 increase in payroll employment for February, outpacing the 230,000 average over the previous 12 months. The payroll data for January and December were revised down by a total of 167,000. The private sector added 223,000 new jobs, the largest gain since May of last year.

Temporary help services employment continues a steep decline after a sharp post-pandemic rise.

Average hours of work increased from 34.2 to 34.3. The increase, along with the 223,000 private employment increase led to a hefty increase in total hours of 5.6% at an annualized rate, also the largest increase since May of last year.

The establishment report, once again, beat “expectations;” the WSJ survey of economists was 198,000. Other than the downward revisions, mentioned above, another bit of negative news was a smallish increase in wage growth, from $34.52 to $34.57.

The household survey shows that the labor force increased 150,000, a drop in employment of 184,000 and an increase in the number of unemployed persons of 334,000. The labor force participation rate held steady at 62.5, the employment to population ratio decreased from 60.2 to 60.1 and the unemployment rate increased from 3.66 to 3.86. Remember that the unemployment rate is the number of unemployed relative to the labor force (the number employed plus the number unemployed). Consequently, the unemployment rate can go up if the number of unemployed rises holding fixed the labor force, or if the labor force shrinks holding the number unemployed unchanged. An increase in the unemployment rate is not necessarily a bad thing: it may reflect a strong labor market drawing “marginally attached” individuals from outside the labor force. Indeed, there was a 96,000 decline in those workers.

Earlier in the week, the BLS announced JOLTS (Job Openings and Labor Turnover Survey) data for January. There isn’t much to report here as the job openings changed little at 8.9 million, the number of hires and total separations were little changed at 5.7 million and 5.3 million, respectively.

As has been the case for the last couple of years, the number of job openings remains higher than the number of unemployed persons.

Also earlier in the week the BLS announced that productivity increased 3.2% in the 4th quarter with output rising 3.5% and hours of work rising 0.3%.

The bottom line is that the labor market continues its surprisingly (to some) strong performance, once again proving stronger than many had expected. This strength makes it difficult to justify any interest rate cuts soon, particularly given the recent inflation spike.

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Mortgage rates fall as labor market normalizes

Jobless claims show an expanding economy. We will only be in a recession once jobless claims exceed 323,000 on a four-week moving average.

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17 hours ago

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March 8, 2024

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Everyone was waiting to see if this week’s jobs report would send mortgage rates higher, which is what happened last month. Instead, the 10-year yield had a muted response after the headline number beat estimates, but we have negative job revisions from previous months. The Federal Reserve’s fear of wage growth spiraling out of control hasn’t materialized for over two years now and the unemployment rate ticked up to 3.9%. For now, we can say the labor market isn’t tight anymore, but it’s also not breaking.

The key labor data line in this expansion is the weekly jobless claims report. Jobless claims show an expanding economy that has not lost jobs yet. We will only be in a recession once jobless claims exceed 323,000 on a four-week moving average.

From the Fed: In the week ended March 2, initial claims for unemployment insurance benefits were flat, at 217,000. The four-week moving average declined slightly by 750, to 212,250


Below is an explanation of how we got here with the labor market, which all started during COVID-19.

1. I wrote the COVID-19 recovery model on April 7, 2020, and retired it on Dec. 9, 2020. By that time, the upfront recovery phase was done, and I needed to model out when we would get the jobs lost back.

2. Early in the labor market recovery, when we saw weaker job reports, I doubled and tripled down on my assertion that job openings would get to 10 million in this recovery. Job openings rose as high as to 12 million and are currently over 9 million. Even with the massive miss on a job report in May 2021, I didn’t waver.

Currently, the jobs openings, quit percentage and hires data are below pre-COVID-19 levels, which means the labor market isn’t as tight as it once was, and this is why the employment cost index has been slowing data to move along the quits percentage.  

2-US_Job_Quits_Rate-1-2

3. I wrote that we should get back all the jobs lost to COVID-19 by September of 2022. At the time this would be a speedy labor market recovery, and it happened on schedule, too

Total employment data

4. This is the key one for right now: If COVID-19 hadn’t happened, we would have between 157 million and 159 million jobs today, which would have been in line with the job growth rate in February 2020. Today, we are at 157,808,000. This is important because job growth should be cooling down now. We are more in line with where the labor market should be when averaging 140K-165K monthly. So for now, the fact that we aren’t trending between 140K-165K means we still have a bit more recovery kick left before we get down to those levels. 




From BLS: Total nonfarm payroll employment rose by 275,000 in February, and the unemployment rate increased to 3.9 percent, the U.S. Bureau of Labor Statistics reported today. Job gains occurred in health care, in government, in food services and drinking places, in social assistance, and in transportation and warehousing.

Here are the jobs that were created and lost in the previous month:

IMG_5092

In this jobs report, the unemployment rate for education levels looks like this:

  • Less than a high school diploma: 6.1%
  • High school graduate and no college: 4.2%
  • Some college or associate degree: 3.1%
  • Bachelor’s degree or higher: 2.2%
IMG_5093_320f22

Today’s report has continued the trend of the labor data beating my expectations, only because I am looking for the jobs data to slow down to a level of 140K-165K, which hasn’t happened yet. I wouldn’t categorize the labor market as being tight anymore because of the quits ratio and the hires data in the job openings report. This also shows itself in the employment cost index as well. These are key data lines for the Fed and the reason we are going to see three rate cuts this year.

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Inside The Most Ridiculous Jobs Report In History: Record 1.2 Million Immigrant Jobs Added In One Month

Inside The Most Ridiculous Jobs Report In History: Record 1.2 Million Immigrant Jobs Added In One Month

Last month we though that the January…

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March 8, 2024

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Inside The Most Ridiculous Jobs Report In History: Record 1.2 Million Immigrant Jobs Added In One Month

Last month we though that the January jobs report was the "most ridiculous in recent history" but, boy, were we wrong because this morning the Biden department of goalseeked propaganda (aka BLS) published the February jobs report, and holy crap was that something else. Even Goebbels would blush. 

What happened? Let's take a closer look.

On the surface, it was (almost) another blockbuster jobs report, certainly one which nobody expected, or rather just one bank out of 76 expected. Starting at the top, the BLS reported that in February the US unexpectedly added 275K jobs, with just one research analyst (from Dai-Ichi Research) expecting a higher number.

Some context: after last month's record 4-sigma beat, today's print was "only" 3 sigma higher than estimates. Needless to say, two multiple sigma beats in a row used to only happen in the USSR... and now in the US, apparently.

Before we go any further, a quick note on what last month we said was "the most ridiculous jobs report in recent history": it appears the BLS read our comments and decided to stop beclowing itself. It did that by slashing last month's ridiculous print by over a third, and revising what was originally reported as a massive 353K beat to just 229K,  a 124K revision, which was the biggest one-month negative revision in two years!

Of course, that does not mean that this month's jobs print won't be revised lower: it will be, and not just that month but every other month until the November election because that's the only tool left in the Biden admin's box: pretend the economic and jobs are strong, then revise them sharply lower the next month, something we pointed out first last summer and which has not failed to disappoint once.

To be fair, not every aspect of the jobs report was stellar (after all, the BLS had to give it some vague credibility). Take the unemployment rate, after flatlining between 3.4% and 3.8% for two years - and thus denying expectations from Sahm's Rule that a recession may have already started - in February the unemployment rate unexpectedly jumped to 3.9%, the highest since February 2022 (with Black unemployment spiking by 0.3% to 5.6%, an indicator which the Biden admin will quickly slam as widespread economic racism or something).

And then there were average hourly earnings, which after surging 0.6% MoM in January (since revised to 0.5%) and spooking markets that wage growth is so hot, the Fed will have no choice but to delay cuts, in February the number tumbled to just 0.1%, the lowest in two years...

... for one simple reason: last month's average wage surge had nothing to do with actual wages, and everything to do with the BLS estimate of hours worked (which is the denominator in the average wage calculation) which last month tumbled to just 34.1 (we were led to believe) the lowest since the covid pandemic...

... but has since been revised higher while the February print rose even more, to 34.3, hence why the latest average wage data was once again a product not of wages going up, but of how long Americans worked in any weekly period, in this case higher from 34.1 to 34.3, an increase which has a major impact on the average calculation.

While the above data points were examples of some latent weakness in the latest report, perhaps meant to give it a sheen of veracity, it was everything else in the report that was a problem starting with the BLS's latest choice of seasonal adjustments (after last month's wholesale revision), which have gone from merely laughable to full clownshow, as the following comparison between the monthly change in BLS and ADP payrolls shows. The trend is clear: the Biden admin numbers are now clearly rising even as the impartial ADP (which directly logs employment numbers at the company level and is far more accurate), shows an accelerating slowdown.

But it's more than just the Biden admin hanging its "success" on seasonal adjustments: when one digs deeper inside the jobs report, all sorts of ugly things emerge... such as the growing unprecedented divergence between the Establishment (payrolls) survey and much more accurate Household (actual employment) survey. To wit, while in January the BLS claims 275K payrolls were added, the Household survey found that the number of actually employed workers dropped for the third straight month (and 4 in the past 5), this time by 184K (from 161.152K to 160.968K).

This means that while the Payrolls series hits new all time highs every month since December 2020 (when according to the BLS the US had its last month of payrolls losses), the level of Employment has not budged in the past year. Worse, as shown in the chart below, such a gaping divergence has opened between the two series in the past 4 years, that the number of Employed workers would need to soar by 9 million (!) to catch up to what Payrolls claims is the employment situation.

There's more: shifting from a quantitative to a qualitative assessment, reveals just how ugly the composition of "new jobs" has been. Consider this: the BLS reports that in February 2024, the US had 132.9 million full-time jobs and 27.9 million part-time jobs. Well, that's great... until you look back one year and find that in February 2023 the US had 133.2 million full-time jobs, or more than it does one year later! And yes, all the job growth since then has been in part-time jobs, which have increased by 921K since February 2023 (from 27.020 million to 27.941 million).

Here is a summary of the labor composition in the past year: all the new jobs have been part-time jobs!

But wait there's even more, because now that the primary season is over and we enter the heart of election season and political talking points will be thrown around left and right, especially in the context of the immigration crisis created intentionally by the Biden administration which is hoping to import millions of new Democratic voters (maybe the US can hold the presidential election in Honduras or Guatemala, after all it is their citizens that will be illegally casting the key votes in November), what we find is that in February, the number of native-born workers tumbled again, sliding by a massive 560K to just 129.807 million. Add to this the December data, and we get a near-record 2.4 million plunge in native-born workers in just the past 3 months (only the covid crash was worse)!

The offset? A record 1.2 million foreign-born (read immigrants, both legal and illegal but mostly illegal) workers added in February!

Said otherwise, not only has all job creation in the past 6 years has been exclusively for foreign-born workers...

Source: St Louis Fed FRED Native Born and Foreign Born

... but there has been zero job-creation for native born workers since June 2018!

This is a huge issue - especially at a time of an illegal alien flood at the southwest border...

... and is about to become a huge political scandal, because once the inevitable recession finally hits, there will be millions of furious unemployed Americans demanding a more accurate explanation for what happened - i.e., the illegal immigration floodgates that were opened by the Biden admin.

Which is also why Biden's handlers will do everything in their power to insure there is no official recession before November... and why after the election is over, all economic hell will finally break loose. Until then, however, expect the jobs numbers to get even more ridiculous.

Tyler Durden Fri, 03/08/2024 - 13:30

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