Cathie Wood's ARK Space Exploration & Innovation ETF is bulking up on Honeywell and Deere, a pair of industrial giants with space-related businesses whose stocks have been slumping.
The ETF on Monday added 4,230 shares of Honeywell, a Dow Jones industrial component, according to ARK Invest's latest trading disclosures. As of Tuesday, the ETF held 21,714 shares for a market value of about $4.5 million. The holding accounts for about 1% of the $406 million fund.
Honeywell has been a supplier to NASA for nearly 60 years and makes products for military and commercial space programs. It provides components for small satellites and for the Orion spacecraft fleet for planned missions to the moon.
The Dow Jones stock broke out of a cup-with-handle base on June 30. But less than a month later, shares are below the 230.47 buy point and trending lower. On Tuesday, Honeywell stock was more than 13% below its July peak, with a Relative Strength Rating of 20 out of 99. Its Composite Rating is 60.
The 50-day moving average has crossed below the 200-day line, a bearish sign. From a valuation perspective, however, the price-to-earnings ratio of 20 is below the S&P 500's ratio, according to IBD MarketSurge.
Cathie Wood ETF Adds Deere
The Cathie Wood team also added 2,369 shares of Deere, bringing its share of the portfolio to 31,448 shares worth some $14.58 million. That's about 3.3% of the ETF, according to ARK Invest documents.
Best known for agricultural equipment, Deere last year struck an agreement with Elon Musk's SpaceX. Deere uses SpaceX's Starlink satellite network for precision guidance of agricultural equipment. The Starlink partnership will enable autonomous farming operations, according to Deere.
Deere stock also is trending lower, trading at the lowest level since May. The stock is 13% below its prior high, yet it's technically forming a flat base with a 533.78 buy point. The 50-day line also has crossed below the 200-day average.
Deere's Composite Rating is 34 and its Relative Strength Rating is 38.
The ARK Space Exploration ETF also reported adding 7,455 shares of L3Harris Technologies. It now owns a total of 104,859 shares with a value of more than $31 million, or about 7% of the fund.
L3Harris stock topped the 280.52 buy point of a flat base on Sept. 11 and is up 7% from that entry. The relative strength line is at new highs also, a good technical sign.
The electronic warfare company is developing technology for the Golden Dome antimissile program. The company's satellites for the next generation of GPS navigation, with antijamming technology, were launched in August.
In another move, fund managers sold 43,777 shares of Kratos Defense & Security Solutions, taking its stake to 10.4% of the fund. It remains the largest holding in the fund. As of Tuesday, ARK Space Exploration still owned 522,406 shares worth $46 million.
The sale appears to be profit-taking: Kratos stock is up nearly 240% year to date and up 151% from a base breakout at 35.66 in early May. The stock has bounced off support at the 10-week moving average several times since then. Its Composite Rating is 97.
