Cathie Wood’s Ark ETFs bought over 3 million shares of Skillz the day it reported earnings. Now the stock is down 10% after shaky results.

Skillz
Skillz website.

  • Two of Cathie Wood’s ARK ETFs bought a combined 3,071,654 shares of Skillz on Tuesday.
  • The shares were worth some $52 million before a significant drop hit the stock today.
  • Skillz reported worse than expected losses in its quarterly results, but there were a number of bright spots as well.
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Two of Cathie Wood’s ARK ETFs bought a combined 3,071,654 shares of the online mobile multiplayer video game competition platform Skillz on Tuesday.

Specifically, the ARK Innovation ETF bought 2,717,021 shares while the ARK Next Generation Internet ETF bought 354,633 shares.

Skillz is now the 43rd largest holding of the ARK Innovation ETF (8,514,573 shares) and the 20th largest holding of the ARK Next Generation Internet ETF (7,050,447 shares).

Combined, the shares were worth some $52 million based on Tuesday’s closing price of $16.94 per share.

After Wood’s buys, Skillz released its quarterly earnings results that included larger than expected losses and the stock fell as much as 10.83% on Wednesday.

Skillz more than doubled its quarterly losses versus the same period a year ago in the first quarter, losing $0.15 per share compared to analysts’ estimates for a $0.10 loss.

Still, there were plenty of bright spots in the quarterly report. First-quarter revenue jumped 92% year-over-year to $84 million and paid active users surged 81%.

Skillz also raised its full-year revenue guidance to $375 million, which equates to 63% year-over-year growth.

The company landed some analyst support from Wedbush analyst Michael Pachter post-earnings as well.

Pachter maintained his “buy” rating and $34 price target on the stock, citing the impressive growth of the company’s gaming platform.

Skillz also recently added ex-Airbnb Executive Ian Lee as its chief financial officer. Lee was the head of investor relations during Airbnb’s December, 2020 IPO. He holds an MBA in Finance from the Wharton School at the University of Pennsylvania.

Skillz launched a game developer challenge with the NFL last Wednesday as well, adding to the long-term bull case for the stock.

Shares of Skillz traded down 9.29% as of 3:38 p.m. ET on Wednesday.

Skillz stock chart
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Skillz jumps after Cathie Wood’s ARK Innovation ETF added another 1.2 million shares of the mobile gaming platform on Thursday

Skillz
Skillz website.

  • Skillz stock jumped as much as 5.84% on Friday after one of Cathie Wood’s ETFs announced it bulked up its investment.
  • The ARK Innovation ETF added over 1.2 million shares of the gaming platform on Thursday.
  • Skillz revenue increased 92% YoY in 2020, but net losses hit a record $122 million as well.
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Skillz saw its stock jump as much as 5.84% on Friday before paring gains after Cathie Wood’s ARK Innovation ETF added another 1,222,207 shares of the mobile gaming platform to its holdings on Thursday.

As of Thursday’s closing price, ARK’s roughly 1.2 million shares were worth $20.25 million.

The ARK Innovation ETF held 4,014,903 shares of Skillz prior to Thursday’s buys, making it the ETF’s 56th largest holding.

Skillz was founded in 2012 by Andrew Paradise and Casey Chafkin as a platform where ordinary gamers can compete to win real prize money.

The company boasts 2.4 million monthly active users and 9,000 registered game developers, according to its latest SEC filings. Skillz also dishes out more than $100 million in prizes to users each month.

The San-Francisco-based firm saw its revenue jump 92% year-over-year in 2020 to just over $230 million, although net losses increased to a record $122 million for the year as well.

Analysts are mostly bullish on Skillz’s prospects. The company holds four “buy” ratings, two “hold” ratings, and zero “sell” ratings from analysts.

Most recently, Jefferies analyst Andrew Uerkwitz initiated coverage on Skillz with a “hold” rating and price target of $17. Analysts’ average price target for the stock is $27.83 per share.

Skillz went public via a merger with the special purpose acquisition company (SPAC) Flying Eagle Acquisition Corp. back in December of 2020 at a valuation of $3.5 billion. The company is now worth over $6.5 billion.

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