Cathie Wood Goes Bargain Hunting: 3 Stocks She Just Bought

Cathie Wood's ETF added to four existing positions Monday, including Joby Aviation, GeneDx Holdings and DraftKings. Joby (market cap ~ $10B) generated < $50M revenue last year, trades at ~184x trailing revenue, and was selected for the White House–backed eVTOL Integration Pilot Program to begin service in 10 states later this year. GeneDx reported revenue up 40% to $427.5M with net loss narrowed to $21M (vs $433M prior year), market cap ~ $3B, shares down ~45% from a three-month peak and analysts project profitability next year. DraftKings posted $6.1B revenue (+27%), serves 10.9M customers, unveiled a consolidated app, and is modeled for ~14% revenue growth over two years with adjusted earnings expected to triple, trading at ~13x next-year profit estimates.

Analysis

The recent repositioning of growth capital into eVTOL, specialty genomics, and online wagering shifts the investment debate from binary technical/regulatory milestones to execution of commercial networks and unit economics. For eVTOL, the marginal value now lives in vertical infrastructure buildout, insurance/maintenance ecosystems, and high-density battery supply rather than prototype certification; those downstream bottlenecks create multi-year optionality for vertiport developers, specialized MRO providers, and high-gravity suppliers of high-power cells.

In specialty genomics, the path to sustained profitability is driven less by incremental test volume than by payer contract dynamics and bioinformatics cost-per-test compression. If reimbursement stabilizes or consolidators seek scale, this becomes an M&A candidate with >30% adj. margin upside potential; conversely, a single national reimbursement cut or unfavorable LCD could reprice expectations within quarters.

For regulated consumer wagering, product consolidation into a single UX materially reduces CAC and raises ARPU if retention kinks are solved; regulatory or tax shocks at the state level, and adversarial advertising rules, remain the fastest mechanisms to erode forward EBITDA multiples. Second-order, rising TV/streaming ad costs and changes to fantasy-sports rules could compress acquisition efficiency across the category.

Across themes, the clearest short-term arbitrage is selection risk — which operator captures local market share and controls infrastructure — not sector-level demand. That argues for small, defined-risk structures to express convex upside while capping exposure to policy reversals and execution slippage over 6–24 months.

Key Decisions for Investors

• Long DKNG (size 1–2% NAV): buy Jan 2028 LEAP call or a 12–24 month 40–60% OTM call spread to express ARPU/margin recovery. Target +40–80% in 12–24 months; max loss = premium (defined-risk). Rationale: consolidation of product reduces CAC; downside: state-level tax or indexation of handle reduces EBITDA by >20%.
• Long WGS (size 0.5–1% NAV) with income tilt: purchase shares and sell a 12-month 25% OTM put to lower basis. Time horizon 12–24 months; upside 50%+ if payer contracts stabilize or M&A premium arrives; downside capped by equity delta and put obligation — stress-test for a 30–40% reimbursement haircut.
• Tactical JOBY defined-risk exposure (size 0.25% NAV): buy a 12-month call spread (ATM-to-~100% OTM) rather than naked equity to capture commercialization optionality while limiting downside to premium. Expect binary outcomes: 100%+ upside if network execution accelerates vs total premium loss if operational/regulatory slippage occurs.
• Volatility harvesting around JOBY headlines: sell short-dated strangles only after liquidity and hedge with underlying or calendar spreads (max 0.1% NAV). Reward = collect elevated IV post-news; tail risk requires quick delta-hedge and buy-ins if adverse certification/legal news emerges within days.