Cathie Wood’s ARK exchange-traded funds purchased nearly 747,000 shares of DocuSign on Friday following the e-signature company’s steep decline.
ARK’s flagship fund, ARK Innovation ETF (ticker: ARKK), bought 461,662 of DocuSign (DOCU), while the ARK Next Generation Internet ETF (ARKW) bought 178,334 shares. The Ark Fintech Innovation ETF (ARKF) bought 106,968, according to the daily trades posted by the ARK funds.
Shares of DocuSign sank more than 42% Friday after the company issued a fourth-quarter forecast that missed estimates.
The company said it expects revenue for the fiscal fourth quarter ending Jan. 31, of $557 million to $563 million, below analysts’ expectations of $573.8 million. DocuSign expects fourth-quarter billings of $647 million to $659 million. Analysts were forecasting fourth-quarter billings of $705.4 million, according to FactSet.
Analysts at Citigroup said DocuSign “delivered one of the biggest [Software as a Service] whiffs in recent memory.”
The stock was up 4.7% to $141.39 on Monday. It is down 36.4% this year.
In a weekly commentary sent to investors in the ARK funds, Wood’s firm wrote of how DocuSign noted a weakening of demand as the growth it experienced during the pandemic has slowed. ARK expects that growth to “re-accelerate.”
“We believe the transition from paper to digital agreements is enduring and expect growth to re-accelerate in the long-term as management refocuses go-to-market efforts,” ARK said.
Meanwhile, the ARK Innovation ETF bought 176,298 of Zoom Video Communications (ZM) on Friday, and the ARK Next Generation Internet ETF purchased 46,813 shares. Zoom Video fell 4.1% on Friday and was down 0.2% on Monday.
Wood’s ARK funds also bought about 1.68 million shares of shares of Ginkgo Bioworks (DNA), a leader in the emerging field of synthetic biology, on Friday. It recently went public through a merger with a special purpose acquisition company in one of the largest SPAC combinations. Ginkgo shares fell more than 15% on Friday.
The ARK Innovation ETF itself fell 5.5% on Friday as the technology stocks it holds tumbled. The ETF was down 0.8% on Monday and has dropped 25% in 2021. The tech-heavy Nasdaq has risen 17%.
Write to Joe Woelfel at [email protected]
