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Analyzing the Insider Data for NVIDIA Corporation (NVDA)

Recent insider trends for NVIDIA Corporation (NASDAQ:NVDA) have caught the attention of investors. Insider data is useful because it can reveal what a company’s executives and largest shareholders feel about a stock. In this case, the data has some interesting things to say about how NVDA might perform in the future.

Institutions own 67.56% of NVIDIA Corporation (NVDA)’s shares. The total value of these holdings, in millions, is $87,613. Among active positions in the latest quarter, 523 holders increased their positions by a total of 35.26 million shares, 415 holders decreased the positions by a total of 38.35 million shares, and 101 holders held their positions. This works out to a net decrease in ownership of 3.09 million shares, and suggests that institutions are feeling bearish about the stock.

Among new and sold out positions, 155 holders initiated new positions by a total of 6.07 million shares and 73 holders exited their positions by a total of 3.69 million shares. This nets out to an increase of 2.38 million shares and is a bullish sign for NVDA.

In the last three months, insiders executed a total of 19 trades. 4 of these were buys and 15 were sells. Insider ownership decreased by a total of 744927 shares, which suggests that NVDA’s key executives are feeling less optimistic about the outlook for the stock. The data from the past twelve months tells a similar story: insiders executed 23 buys and 60 sells, and ownership decreased by a net of 2.1 million shares.



The analysis of insider buying and selling trends can be extended to the aggregate level. Short interest, which represents the number of a stock’s shares currently being shorted, captures what the market as a whole feels about a stock. NVIDIA Corporation (NASDAQ:NVDA)’s short interest is 12.8 million shares, or 2.28% of the float. This represents a decrease of -13% in the number of shares being shorted compared to the previous reading, and implies that investors felt less pessimistic about the stock during the past two weeks.

Ownership trends and trading patterns can be useful tools for predicting a stock’s performance, but it’s also important to consider the technicals in order to form a more comprehensive view. A composite of 13 technical indicators that includes measures such as moving averages and momentum oscillators suggests that NVDA is a Strong buy, which implies that NVDA is expected to outperform the market based on prior trading patterns.

Conclusion




Institutional ownership trends suggest that the stock is cheap and the insider trading data indicates that insiders are bearish. Technical indicators (also) suggest that NVIDIA Corporation (NASDAQ:NVDA) is undervalued.

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