Ark Invest CEO Cathie Wood is doubling down on genomics.
What Happened: Pacific Biosciences of California Inc. (NASDAQ:PACB), known as PacBio, is biotech's new kid on the block. The company's Vega sequencer might be the spark that reignites the genomics flame in Ark Invest's portfolios.
ARK Invest has been consistently increasing its stake in PacBio since mid-November. Most recently, the fund added over 24,000 shares on Dec. 3.
While the stock is down 75% over the past year, Ark's conviction shows no signs of wavering. Wood believes in the sector's long-term growth potential, particularly with genomics merging with AI advancements.
During eToro's "Digest & Invest" podcast, Woods emphasized that investors need to look beyond conventional benchmarks. She noted that declining AI training costs enable breakthroughs in gene editing and genome sequencing.
Despite market headwinds like high interest rates, Wood remains bullish, suggesting those ignoring the genomics sector risk missing out on transformative opportunities.
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Why It Matters: PacBio carved out its niche in long-read sequencing, an advanced technology that maps entire genomes with unparalleled accuracy.
The Menlo Park, California-based company's latest launch, the Vega benchtop sequencer, combines affordability ($169,000) with precision. It aims to democratize access to PacBio's HiFi sequencing tech.
PacBio has steadily enhanced its technology, incorporating Sequencing by Binding (SBB) chemistry after acquiring Omniome in 2021. The result? A unique offering that bridges short-read and long-read sequencing needs.
Financially, PacBio is tightening its belt. Non-GAAP operating expenses dropped to $62.4 million in the third quarter 2024, down from $90.9 million a year ago. Meanwhile, consumables sales hit $18.5 million, marking a record for the company's Onso system.
PacBio's story isn't without challenges, considering short interest is over 20%. Yet Wood's Ark holds a 12.26% stake (as of Sept. 30), solidifying her vote of confidence in PacBio.
Biotech's broader market surged by over 29% this year. PacBio's shares have struggled, but Wood's accumulation suggests she sees this as a buying opportunity rather than a red flag.
What's Next: Vega's launch is slated for early 2025.
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Image: Courtesy of Cathie Wood
