Investors in Cathie Wood’s ARK Innovation (NYSEARCA:ARKK) the exchange-traded fund (ETF) had a great year 2020, with the fund delivering an incredible 148% return. However, the same cannot be said for 2021, as the fund has reversed course and is down 25% since the start of the year (YTD). In fact, the fund is down just 7% today, at the time of writing.
With that said, let’s take a look at some of the biggest losers in the ARKK ETF last year.
Losers of ETF ARKK: Teladoc (TDOC)
Teladoc (NYSE:TDOC) ranks second in terms of portfolio weighting in the ARKK ETF, just behind You’re here (NASDAQ:TSLA). The telehealth provider peaked at $ 308 in February before collapsing 70% to the current price of $ 91. Last year, Teladoc bought Livongo for $ 18.5 billion in a successful transaction. TDOC’s stock market cap is now trading below its purchase price of Livongo, totaling $ 14.6 billion.
Is TDOC stock worth buying now? Investors may want to analyze telecare visits and the sustainability of Teladoc’s business model before making a purchase. However, there is no doubt that Teladoc is trading at a discount to the peak valuations of Covid.
Zoom Technologies (NASDAQ:ZM) led the pandemic as a barometer of home inventory. The video communications company grew 400% in 2020. However, 2o21 is a whole different story, as Zoom is down 48% so far. ZM stock has suffered multiple cuts as investors weigh Microsoft (NASDAQ:MSFT) Teams gain market share and tendency to return to the office.
That said, Zoom’s revenue grew 35% in the third quarter and exceeded analysts’ expectations. The company is headed by a knowledgeable CEO, Eric Yuan, and will most likely continue to innovate regardless of the share price.
ARKK ETF Losers: Spotify (SPOT)
Actions of Spotify technology (NYSE:PLACE) are down 27% since the start of the year. The streaming music provider peaked at $ 305 in November before falling 26% to the current price of $ 226. Nonetheless, Spotify continues to sign deals with major artists, podcast hosts, and celebrities.
Additionally, Spotify is ranked by CNET as the best music streaming service, beating Apple (NASDAQ:AAPL) Music and Amazon (NASDAQ:AMZN) Music. The demand for streaming music isn’t going away anytime soon, so investors may want to take a close look at SPOT stocks.
Reddit favorite Palantir Technologies (NYSE:PLTR) also contributed to the fall in ARKK ETF. The data analytics firm has lost 20% of its value since the start of the year amid fears of slower growth in government and the business sector.
On the other hand, Goldman Sachs still believes PLTR stock is a buy with a target price of $ 30. Even with the risk of rising rates, Goldman remains confident as Palantir does not trade solely on the value of future cash flows. Due to Palantir’s healthy cash flow today, the stock valuation is not entirely dependent on long-term cash flow estimates.
ARKK ETF Losers: Twitter (TWTR)
Investors in Twitter (NYSE:TWTR) the stock seemed happy with Jack Dorsey’s resignation last month, but the stock is down 19% since its announcement. Worse still, the TWTR share returned -23% over the current year, compared to S&P 500 22% yield.
While the era of Jack Dorsey may be over, all eyes are now on new CEO Parag Agrawal. After a series of disappointing features this year, such as Twitter Fleets and Twitter Blue, potential investors may want to focus on the future. Specifically, investors want an increase in ad revenue and a possible change in Twitter’s ad algorithm. Ads are a major source of income for social media players, and Twitter still has a lot of work to do in this department.
At the time of publication, Eddie Pan had (directly or indirectly) no position in any of the stocks mentioned in this article. The opinions expressed in this article are those of the author, subject to the publication guidelines of InvestorPlace.com.