Cathie Wood's funds bought $25 million worth of Figma stock, should we follow suit?

Cathie Wood's ARK Invest has invested in shares of Figma, an online design service, Benzinga notes. Through its key funds - ARK Innovation ETF (ARKK) and ARK Next Generation Internet ETF (ARKW) - ARK Invest bought more than 964,000 shares of the company for nearly $25 million.

The deals were made on Thursday, February 19. Their lion's share came to the flagship fund ARK Invest - ARKK (focuses on technological securities with growth potential), it replenished the portfolio with Figma shares for 823,965 securities. According to the documents on the ARK Invest website - this data describes the full position of ARKK in Figma securities, in total in the fund's portfolio shares of design-platform occupy 0.34%.

In addition, on February 19, 140,377 shares of Figma were acquired by another fund of Cathie Wood - ARKW (focused on next-generation Internet technologies), Benzinga writes. This fund has a total of 873,822 Figma securities on its balance sheet, according to its disclosure data. Figma holds 1.43% of ARKW's portfolio.

Based on the Feb. 19 closing price of Design Platform shares at $25.86 apiece, the total value of the deal was about $24.93 million, Benzinga wrote.

Cathie Wood's interest coincided with a strong growth of Figma quotations, which jumped by almost 7% at the end of the trading session on Thursday. At the pre-market on February 20, Figma securities were down by 1.3%.

The main driver for Figma's securities the day before was the company's strong quarterly report: Figma reported earnings of $0.08 per share, which exceeded market expectations. An additional growth factor was the development of the company's technological partnership with the AI-laboratory Anthropic. In particular, investors' attention was attracted by the new "Code to Canvas" feature, which integrates code generation by neural networks directly into designers' workflow, significantly speeding up the creation of digital products.

Analyst Anurag Rana from Bloomberg Intelligence believes that Figma's strong performance reduces market anxiety - the design platform's securities have lost more than 10% over the past month amid a sell-off in the software industry and investors' fears that new AI models and agents could destroy the business of some software companies. However, according to the analyst, the company's success proves that AI technologies will not destroy habitual software vendors, but will become a growth driver for them.

However, despite the latest correction, Figma's shares are still overvalued and trading at nearly 90 times projected earnings for this year, Barron's noted the day before. The design platform also faces serious competition from Canva, a startup that is expected to file for an IPO this year, the publication pointed out.

According to FactSet, only three out of ten analysts who cover Figma recommend Buy on the stock. Six gave them a Hold rating and one gave them a Sell rating.

In parallel with the purchase of Figma ARK Invest has rebalanced fund portfolios in other positions, according to Benzinga. Thus, the fund ARK Fintech Innovation ETF (ARKF, focuses on fintech) entered the capital of fintech giant Klarna Group, buying 56.5 thousand shares. On that day, Klarna's shares fell by more than a quarter, dropping to $13.85 per share - this happened against the background of the company's quarterly report, where Klarna reported a record quarterly revenue of $1.08 billion and gave a weak forecast for 2026, which did not meet analysts' expectations.

At the same time, ARKK reduced its position in the securities of the platform for sports fans and gambling Draftkings, realizing more than 480 thousand shares, and the fund ARKW got rid of large blocks of cloud service Salesforce and shares of social network Pinterest. At the close of trading on February 19, Draftkings securities fell by 3.1% to $22.49 per paper; Salesforce - by 1.3% to $185.29; and Pinterest rose by 2.3% to $16.77 per share.

This article was AI-translated and verified by a human editor