Nvidia Stock Nears Record High as Cathie Wood Adds Shares

Nvidia stock extended its rebound and moved closer to its all-time high as Cathie Wood’s ARK Invest added shares.

NVDA traded near $220, up about 16% from its July low of $189.90. The stock reached its highest level since early June.

SpaceX’s commitment to Nvidia hardware, rising hyperscaler spending and improving technical momentum supported the rally.

However, Nvidia must clear its previous record near $236 before higher targets between $250 and $300 become relevant.

Cathie Wood is Accumulating Nvidia Stock

ARK Invest’s Cathie Wood continues to accumulate Nvidia shares, suggesting that she expects it to continue the rally. In her last transaction, she bought shares worth over $17.5 million as she offloaded other popular names like Roblox, Circle, and Palantir.

Wood owns Nvidia through several of her ETFs. For example, the Ark Innovation Fund (ARKK) owns 580,162 coins currently worth over $127 million. Similarly, the ARK Autonomous Technology & Robotics ETF (ARKQ) holds Nvidia shares worth over $68 million, while ARK Next Generation Internet ETF (ARKW) holds shares worth over $33 million.

According to Yahoo Finance, ARK Invest joins other companies such as BlackRock, Vanguard, State Street, and Geode Capital in owning large stakes in the company.

Traders follow Cathie Wood’s investments because she is one of the most prominent investors in the US. However, history shows that her flagship funds have underperformed the broader market over time. For example, ARKK ETF has dropped by double digits in the past five years, while the S&P 500 Index has jumped to a record high.

Nvidia Shares Have Bullish Catalysts

Nvidia has some of the best bullish catalysts on Wall Street. First, the recent big-tech companies continued to release strong financial results while maintaining their capital expenditure outlook. In total, the biggest companies are expected to spend over $750 billion this year, with most of these funds going to Nvidia and other chip companies. In a statement this week, SpaceX said that it will use Nvidia exclusively for its chips.

Second, there are signs that the company’s revenue growth has more room to go. Yahoo Finance data shows that its second-quarter revenue will come in at $91.85 billion, a big increase from the $46 billion it made in the same period last year. Historically, Nvidia has beaten analysts’ estimates by a wide margin. As such, it will not be a surprise if its revenue jumps to $96 billion.

Nvidia’s revenue growth is driven by both organic and inorganic aspects. Its organic business is doing well because of the quality of its products. On the other hand, its inorganic business is based on the circular finance aspect. This is where it invests in companies like OpenAI and CoreWeave, which then use the funds to buy the chips.

Additionally, the company is positioning itself for the AI agent era. It has already launched its central processing unit (CPU), which is expected to continue to thrive, as we saw in Intel’s recent earnings. Intel, a top CPU seller, said that its revenue jumped by 25% to $16.1 billion.

Additionally, Nvidia is a bargain, with its forward price-to-earnings ratio being at 24, lower than the five-year average of 43. For a company growing like this, a higher valuation multiple is likely warranted.

NVDA Stock Price Technical Analysis

Nvidia shares have been in a strong uptrend in the past two weeks. It jumped to $220 today, moving above the crucial resistance level of $214, the neckline of the double-bottom pattern at $189. A double bottom normally leads to more upside over time.

The stock has also jumped above the upper side of the descending channel. This channel is part of the formation of the bullish flag pattern. It remains above the 200-day moving average, while the RSI has continued to rise and is at its highest level since May 18. Therefore, the shares will likely continue rising as buyers target the all-time high of $236.

This article is for informational purposes only and does not constitute financial or investment advice. Equity prices remain highly volatile.