ARKG Top Holding Signify Reported to Be Acquisition Target by CVS

CVS Health Corp (CVS) is seeking to buy Signify Health Inc. (SGFY) as it looks to expand in-home health services, the Wall Street Journal reported on Sunday, citing sources.

Signify Health is exploring strategic alternatives including a sale, the Wall Street Journal reported this past week. Initial bids are due this coming week, and CVS is planning to enter one, some sources said. Others are reportedly also in the mix, and CVS could face competition from other managed care providers and private equity firms, according to the Wall Street Journal. 

Signify is a top three holding in the ARK Genomic Revolution ETF (ARKG), weighted at 5.17% as of August 8, according to ARK Invest. In the fund’s portfolio as of August 8, Signify is trailing only Exact Sciences Corp. (EXAS, 7.16% weight in ARKG) and Ionis Pharmaceuticals Inc. (IONS, 5.76%), according to the fund’s website.

“One of the benefits of active ETFs is to tap into management’s ability to identify underappreciated companies,” Todd Rosenbluth, head of research at VettaFi, said. “In this case, ARK has done so with Signify Health, which should help drive the ETF higher.”

Signify has a market value of around $4.7 billion. Shares of the healthcare company were up nearly 16% in premarket trading on Monday.

ARKG is an actively managed equity strategy that aims to provide exposure to DNA sequencing technology, gene editing, CRISPR, therapeutics, agricultural biology, and molecular diagnostics. 

Companies within ARKG are focused on and are expected to substantially benefit from extending and enhancing the quality of human and other life by incorporating technological and scientific developments and advancements in genomics into their businesses, according to the firm.

ARKG typically holds between 40 and 60 securities and charges an expense ratio of 75 basis points. 

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