One of the most important elements of generative artificial intelligence (AI) development is an advanced chipset called a graphics processing unit (GPU). For now, Nvidia (NASDAQ:NVDA) It completely dominates the GPU space thanks to its A100 and H100 chipsets.
These products have contributed to Nvidia’s record revenue and profit growth over the past few years, but the company’s new Blackwell series GPUs could end up being the company’s biggest product yet.
With Blackwell’s launch scheduled for later this year, is now a good time to buy Nvidia stock? Below, we reveal one tip that may help you make your decision.
Jensen is a great marketer
The CEO is more than just an executive at the top of an organization’s structure. They are often masters of marketing, and Nvidia CEO Jensen Huang is no exception.
In a recent interview with CNBC, Huang said the demand for Blackwell is “insane,” adding, “Everyone wants to have the most, and everyone wants to have the most.” I want to be,” he said.
All things considered, early signs indicate that Nvidia has no problem selling Blackwell GPUs. But with so many possibilities looming, I can’t help but notice one odd statistic.
What are Nvidia insiders doing with the stock?
The term “insider” applies to people such as members of a company’s board of directors and senior executives. Any entity or investor that owns 10% or more of a company is also considered an insider.
Many Nvidia insiders have sold their shares throughout 2024. Indeed, much of that activity derives from the terms of previously agreed vending protocols. But there’s one thing I just can’t get over when it comes to Nvidia insider activity.
The last time an Nvidia insider bought stock was in December 2020, when the company’s chief financial officer, Colette Kress, bought 200 shares on the open market, according to public records.
Should you buy Nvidia stock now?
We fully understand that the rules set by the Securities and Exchange Commission (SEC) regarding insider buying and selling are strict. At this point, it’s very likely that NVIDIA insiders know many details about Blackwell that haven’t been made public yet.
This could include production volumes, purchase orders, backlog trends, etc. So it would look a bit sinister if insiders bought a large amount of shares as Blackwell was about to launch.
But let’s zoom out now and think about the bigger idea.
The AI outlook has been a mainstay of Nvidia’s bullish thesis in recent years. Furthermore, developing a successor to the H100 was not an overnight project. Considering these points, insiders have an opportunity to scoop up stock in hopes that Nvidia’s research and development (R&D) investments will pay off at some point in the future.
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From another perspective, insiders may be bleeding money because they think Nvidia’s stock is unlikely to become an outsized multibagger again in the coming years or even years. there is. Combine that with the fact that famous hedge funds run by Ken Griffin, David Shaw, and David Tepper are also selling Nvidia stock, and I see no reason to buy the stock at this point.
I believe Blackwell will act as a near-term growth catalyst for Nvidia. I’ll be watching closely to see if insiders continue selling after the launch, or if someone finally buys the stock after years of not buying. If this happens, it could indicate that insiders think NVIDIA stock is attractively valued, with significant upside potential.
At the end of the day, I think Blackwell will ignite the short-term popularity of Nvidia stock and turn it into a lucrative trading opportunity. However, as a long-term investor, I recommend avoiding trading or buying on momentum and instead looking for stable, gradual winners that can last several years.
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Adam Spatacco holds a position at Nvidia. The Motley Fool has a position in and recommends Nvidia. The Motley Fool has a disclosure policy.
Should you buy Nvidia stock before Blackwell launches? 1 Very important detail may give you the answer. Originally published by The Motley Fool
