Confounding Trade? Cathie Wood Dumps $50M In Nvidia Shares Just 2 Weeks After Major Buy And A Day Ahead Of Earnings

Cathie Wood-led Ark Investment Management dumped over 293,000 shares of NVIDIA Corporation NVDA on Tuesday via two of the firm’s exchange-traded funds. This comes just two weeks after Ark bought 366,982 shares of NVIDIA Corporation NVDA and a day ahead of the tech company's second-quarter earnings release.

Nvidia was the 23^rd largest holding in the firm’s flagship ARK Innovation ETF ARKK with a weight of 1.49% ahead of Tuesday's trade, according to data on the firm’s website.

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The Context: The stock has lost over 7% in one month and closed at $171.81 on Tuesday. KeyBanc analyst John Vinh reiterated his ‘Overweight’ rating on NVIDIA and a price target of $230. Vinh expects the second quarter results to align with the company's negative pre-announcement on Aug. 8 and expects the quarter to mark the bottom.

Nvidia is expected to report earnings for the second quarter on Wednesday after the bell. Analyst consensus is for Nvidia to post revenue of $8.1 billion and earnings per share of $1.25, according to data from Benzinga.

Major Purchase: Cathie Wood also bought 839,301 shares of Zoom Video Communications Inc ZM, via two of the firm’s ETFs, valued at over $68 million based on Tuesday’s closing price. Zoom Video is the 2^nd largest holding of ARK Innovation ETF valued at over $684 million with a weight of 8.43%.

Zoom reported second-quarter revenue of $1.1 billion, which saw an 8% year-over-year increase.

The company reported second-quarter earnings per share of $1.05, beating the Street estimate of 93 cents per share. Morgan Stanley analyst Meta Marshall has an ‘Overweight’ rating and lowered the price target from $140 to $130, according to Benzinga Pro.