Cathie Wood's Ark Invest Sheds $2.8M Worth Of Nvidia Shares Amid AI Hype, Picks Up Robinhood Stock Worth $1.3M

In a move that caught the attention of investors, Cathie Wood-led Ark Invest offloaded over $2.8 million worth of Nvidia NVDA shares on Wednesday. This trade comes amid a flurry of discussions around Nvidia’s valuation and its potential in the AI sector.

The Nvidia Trade

On Wednesday, Ark sold 4053 shares of Nvidia through ARK Autonomous Technology & Robotics ETF ARKQ, ARK Genomic Revolution ETF ARKG and Ark Fintech Innovation ETF ARKF. The transaction was valued at $2.84 million. Nvidia shares closed 2.75% higher at $700.99. Since 2024 began the shares have soared 41.55% and over 12 months they have appreciated 215.69%.

Ark Invest’s sale of Nvidia shares on Wednesday marks a significant turn in the investment firm’s strategy, especially considering the recent bullish sentiment surrounding Nvidia’s role in the burgeoning AI market. Analysts at Morgan Stanley have highlighted Nvidia’s expansive future in AI, a sentiment echoed by investors and market watchers alike.

However, concerns have been raised about the company’s soaring valuation, with some, including Cathie Wood herself, previously describing Nvidia as “really expensive.” This sale could reflect Ark Invest’s cautious stance towards Nvidia’s current market position, amidst its recognition of the company’s significant role in AI development.

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The Robinhood Trade

The Wood-led firm also acquired 120,020 shares of Robinhood Markets Inc HOOD via its flagship ARK Innovation ETF ARKK and ARK Next Generation Internet ETF ARKW. That transaction was worth $1.32 million. On Wednesday, Robinhood shares closed 2.04% higher at $11.

At the end of January, Ark loaded up on $3.3 million worth of Robinhood shares. The acquisition of Robinhood shares by the firm signifies increasing confidence in the company’s revised strategy and improving financial outlook. Recent analysis underscores Robinhood’s potential within the dynamic fintech industry landscape, indicating a positive trajectory for the company.

For example, Mizuho analyst Dolev maintains a Buy rating for Robinhood (HOOD) with a target price of $15, citing potential earnings boost from a recent 3-cent pass-through charge per option trading contract. Dolev questions if market estimates adequately account for this charge, highlighting its significance due to HOOD’s high operating leverage despite recent declines in adjusted EBITDA estimates.

Other Key Trades:

• Sold a substantial number of shares in UiPath Inc PATH, indicating a strategic shift away from the automation software company.
• Increased its stake in the genomics space with significant purchases in Pacific Biosciences of California PACB and Twist Bioscience Corp TWST, underscoring a continued focus on innovative biotechnology firms.
• Further diversified its investment approach by acquiring shares in 10X Genomics Inc TXG and Recursion Pharmaceuticals RXRX, highlighting Ark’s belief in the potential of cutting-edge genomic and pharmaceutical technologies.

Photo via Ark Invest.

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