5 Tech Stocks To Sell Right Now According To Cathie Wood

4. NVIDIA Corporation (NASDAQ:NVDA)

Number of Hedge Fund Holders: 173

Percentage of Stake Discarded: 35%

NVIDIA Corporation (NASDAQ:NVDA) ranks 4th on our list of stocks to sell according to Cathie Wood. In Q4 2023, Wood sold 35% of her stake in the tech giant. During the quarter, Cathie Wood’s ARK portfolio had 148,081 shares of NVIDIA worth $73.3 million. On February 21, NVIDIA Corporation (NASDAQ:NVDA) reported a Q4 non-GAAP EPS of $5.16 and a revenue of $22.1 billion, exceeding Wall Street estimates by $0.52 and $1.55 billion, respectively. 

According to Insider Monkey’s fourth quarter database, 173 hedge funds were bullish on NVIDIA Corporation (NASDAQ:NVDA), compared to 180 funds in the earlier quarter. Rajiv Jain’s GQG Partners is a significant position holder in the company, with 13.90 million shares worth $6.8 billion. 

SaltLight Capital stated the following regarding NVIDIA Corporation (NASDAQ:NVDA) in its fourth quarter 2023 investor letter:

“We were fortunate to have some exposure to some of the ‘Magnificent Seven’ – Amazon, NVIDIA Corporation (NASDAQ:NVDA), Meta Platforms and Google (although in aggregate, we still hold a smaller weighting than the S&P500).

While we are cautious in AI infrastructure, we do think there are mispriced opportunities in areas of application software where AI can be infused to make a step change improvement. Posted in our office is this chart that ASML provides at each of its investor days. This chart is a little outdated from 2021, but we think illustrates how value (in operating profit) was distributed across semiconductors, hardware, and then software & services. It’s very clear that most of the economic value in the past has accrued to the software services (in grey) built on the backs of highly technical companies run by extremely smart people.

Why is this? We think it is due to a combination of distribution and network effects. Our working hypothesis right now is that this will likely remain a similar outcome in the AI epoch. One outlier right now is Nvidia which is capturing 80% margins..” (Click here to read the full text)