Cathie Wood Goes Bargain Hunting: 3 Stocks She Just Bought

Cathie Wood doesn't shy away from fire sales as the CEO of Ark Invest. On Friday, her family of aggressive growth ETFs added to existing stakes in CoreWeave (NASDAQ: CRWV), Cloudflare (NYSE: NET), and Toast (NYSE: TOST), which declined 14%, 24%, and 11%, respectively.

It was not a good day for those investors. Let's see why Wood is buying at a time when the overall market was going the other way.

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1. CoreWeave

CoreWeave stock tumbled 11% on Friday, after following up mixed financial results with problematic top-line guidance. The hyperscaler is posting explosive growth as the AI revolution clamors for high-performance, low-latency GPU computing infrastructure solutions that CoreWeave excels at providing.

Revenue rose 112% to $2.078 billion through the first three months of this year. Analysts were holding out for a 101% top-line jump. That's a clear beat, but it was a different story on the other end of the income statement. The company posted a first-quarter loss of $1.40 a share, a lot more red ink than the $1.20 a share that Wall Street pros were targeting.

CoreWeave has now fallen short on the bottom line three times over the past four quarters, but that shouldn't be a problem. This isn't a bottom-line story. CoreWeave is investing in growth, spending to make sure it meets the booming AI demand. No one expects it to be profitable in the next couple of years.

But it doesn't have to be. The orders keep stacking up despite the substantial long-term debt on its balance sheet. CoreWeave secured another $40 billion in order commitments during the quarter, bringing its backlog to a whopping $100 billion at the end of March.

This does bring us to the bigger problem than the bottom-line miss. Despite a near quadrupling of the order commitments backlog over the past year, CoreWeave is eyeing only $2.45 billion to $2.6 billion in revenue for the second quarter. This is a 108% increase over the past year at the midpoint, but analysts had been modeling a larger step up. Even the $12 billion to $13 billion in revenue it's forecasting for the entire year was just shy of where the Wall Street pros were perched at the midpoint.

It was far from a perfect report, but was Friday's selling overdone? CoreWeave has done nothing but deliver triple-digit revenue growth in every quarter since going public more than a year ago. It will keep doing that in the near term. The track record for growth investors is pretty good when a company is growing this quickly with a long backlog of orders to keep the pace going for the near future.

2. Cloudflare

Cloudflare stock came within spitting distance of hitting a new all-time intraday high on Thursday. The initial skepticism for cybersecurity stocks in the AI age was subsiding for Cloudlfare as it positions itself as a vital infrastructure necessity for AI agents, edge computing specialists, and the enterprise security market. The bullish momentum went away when Cloudflare offered up its latest financial update.

The numbers were pretty good. Revenue rose 34% to $640 million. Its adjusted earnings were $0.25 per share. Cloudflare topped expectations on both fronts. Its revenue guidance for the current quarter was a tad soft, but it did lift its revenue and adjusted earnings outlook for all of 2026. Unfortunately, the top-line raise of $18 million to $20 million for the full year is essentially the $20 million beat from its initial first-quarter forecast. In short, the outlook for the final nine months of the year remains largely unchanged despite the deluge of new orders.

Cloudflare also announced it will trim its workforce by 1,100 people in the next few months. That's the next step in its push to make the company an agentic AI-first operating model. The move would shave costs in the long run, but at a time when it can't fulfill its order backlog fast enough, is shedding overhead the smartest decision?

3. Toast

All three of the stocks on this list have a few things in common.

• They each experienced double-digit percentage declines on Friday, a day when the broader market inched higher.
• Earnings season came calling, with all of them announcing results after Thursday's market close.
• They were already Ark Invest holdings, with Wood adding more to the positions.

Toast wraps up the list, with a 15% dive after its earnings-season spotlight. Its cloud-based platform for restaurant operators continues to gain traction. Toast added 7,000 net new locations through the first three months of the year. The 171,000 outlets using Toast represent a 22% increase over the past year.

This matches the 22% increase in gross payment volume of $51.3 billion for the first quarter. Net income and operating profit more than doubled. The market still wasn't impressed. Near-term concerns about the restaurant industry and margin pressures resulted in a stock selloff despite the otherwise tasty report. Wood came for seconds, again.

Rick Munarriz has positions in Toast. The Motley Fool has positions in and recommends Cloudflare and Toast. The Motley Fool has a disclosure policy.