Beware, Nvidia stock investors. Don’t be afraid of insider selling.

nvidia (NASDAQ:NVDA) shares continue to hit split-adjusted all-time highs, yet as seen in recent headlines about Nvidia stock, there is one development that could cause some concerns right now.

We’re talking about reports of insider selling of shares of the AI ​​chip giant. The market is bidding up NVDA like it’s going out of fashion. However, take a look insider trading With Nvidia.

The company’s board and C-suite executives, including CEO Jensen Huang, appear to be hell-bent on selling the strength rather than letting it take hold.

So, is it time for us to do the same? Not so fast. As we’ll explain below, this insider selling may not be as big a red flag as it appears on the surface.

Moreover, all things considered, the long-term bullish case remains intact. Pulling money out of fear of insider selling could prove regrettable.

Nvidia Stock: $700 Million in Insider Selling

According to BloombergAs of June 18, year-to-date insider sales by Nvidia executives and board members hit $700 million,

More than a third of this selling happened right after NVDA released its quarterly earnings on May 22. Insider transactions this year have been for selling only, with insider buying being zero.

Other than stock options and other share-based compensation, insiders have not made any Nvidia stock purchases since December 2020.

That was when CFO Colette Kress made an insider purchase worth just $107,390.

Because Bloomberg According to the report, CEO Huang has sold an additional $15.8 million worth of NVDA shares. Kress sold $12.7 million worth of Nvidia shares on June 21.

Still, while these may seem like large numbers at first glance, remember a few things. With Nvidia’s multi-trillion dollar valuation, these figures are much smaller than the NVDA holdings still held by Huang, Kress, and other insiders.

Currently, Huang’s personal stake is worth about $10 billion. Kress’ stake is worth about $655.7 million. Also, while insiders buy for one reason, They sell for different reasons,

Some of these reasons, such as estate planning and diversification, have nothing to do with the fundamentals of the underlying stock.

Still on a high growth momentum

Skeptics might view this as the latest sign of a sell-off in Nvidia shares, but from what we’ve discussed above, it’s clear this is not the main signal of what’s happening.

Of course, this isn’t the first time skeptics have missed the mark by taking a negative stance on NVDA.

As we’ve discussed previously, bears have repeatedly underestimated this top-performing AI chip stock. Expect this trend to continue as Nvidia looks to build on its recent success and pave the way for further revenue and earnings growth.

Nvidia’s sales growth continues at a rapid pace. Even Wall Street analysts are having a hard time keeping a grip on this one.,

Consider also that the arrival of new, even more powerful AI-compatible chips like the Blackwell series will further boost demand, and it’s easy to see that Nvidia will continue to crush it with its quarterly results.

If the said trend continues, it is only fair that the company’s results in the two upcoming fiscal years ending January 2025 and January 2026 should top forecasts.

Two years from now, Nvidia’s revenue could exceed $205 billion, and annual earnings could reach $4.75 per share.

Verdict: Don’t give up so soon, leave it alone

Those following the insiders’ lead may think they are beating the market in terms of timing, but they may later regret that they did so. SoftBank (OTCMKTS:SFTBY) is feeling it now, to exit Nvidia prematurely in 2019,

Yes, five years ago, it was quite hard to expect the generative artificial intelligence revolution. However, the AI ​​chip technology that has come to the market so far is only scratching the surface of what is possible.

So, rather than debating what the recent insider selling means, let’s focus on the fact that the growth story continues with NVDA.

By resisting the urge to give up, and letting your position sit, you could avoid missing out on Nvidia hitting new split-adjusted highs, such as $150, $175, and maybe even $200 per share.

Nvidia stock receives an A rating at Portfolio Grader.

On the date of publication, Louis Navellier had a long position in NVDA. Louis Navellier had no other positions (either directly or indirectly) in the securities mentioned in this article.

The InvestorPlace research staff member primarily responsible for this article did not have (directly or indirectly) any positions in the securities mentioned in this article.


Disclaimer : The content in this article is for educational and informational purposes only.

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