Ark Invest’s chief executive Cathie Wood believes that the application of artificial intelligence that is underappreciated most is “healthcare”.
She said that the use of AI will help cure diseases over time in an interview with CNBC on Tuesday.
Wood expects that gene sequencing and drug discoveries will benefit in particular as artificial intelligence continues reshaping healthcare as we know.
Here are the top two biotech stocks that she believes will benefit from AI by 2025.
Recursion Pharmaceuticals Inc. (NASDAQ: RXRX).
Cathie Wood is bullish about Recursion Pharmaceuticals, as its use of artificial intelligence increased “the number of hypotheses for new drugs per researcher by tenfold within just one year.”
She also recommends that you own the biotech stock because AI could bring more love to Phase 1 and 2 studies by lowering failures and speeding up the time to market.
She said on “Squawkbox” today that she believes the most profound application for artificial intelligence in healthcare is healthcare.
Wood is still bullish on Recursion Pharmaceuticals despite the fact that it has come in below Street expectations in its most recent reported quarter.
In November, RXRX announced a loss per share of 34 cents on revenue of $26.08 millions.
Comparatively, analysts had predicted a loss of 33 cents per share on revenue of $34,87 million.
Recursion shares also do not pay a dividend at the moment.
Cathie Wood says that the company is well positioned to improve financials by integrating artificial intelligence into their operations.
Recursion Pharmaceuticals is a positive company for analysts at Needham, according to her.
The investment firm believes that the EV stock could rise to $11, which would indicate a potential gain of another 45% from current levels.
Illumina Inc (NASDAQ: ILMN)
Illumina shares fell sharply on Tuesday, after China added the company to its list as unreliable entities.
Beijing could announce sanctions against the biotech company soon, including fines, the revocation of work permits for overseas staff, or punitive measures.
Cathie Wood, however, dubbed today’s sale as a buying opportunity. She is convinced that Illumina will play an important role in curing disease in the future by leveraging artificial intelligent for gene sequencing.
Illumina is a leading short read sequencing company. This will be important for the blood tests we use to determine if we have cancer, or if it’s recurring.
Illumina’s quarterly earnings in November exceeded Street expectations.
Illumina stock could be worth buying at current levels, also because Wall Street has a consensus “overweight rating” on it.
Analysts expect ILMN to rise by 30% from its current price of $162.
This post Cathie wood names AI’s most overlooked application may be updated as new information unfolds.
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