Tesla investor Cathie Wood says she's been selling Nvidia stock for some time: 'It has become a check-the-box stock'

• Cathie Wood says Nvidia "has become a check-the-box stock."
• Wood says she's been selling the stock because "expectations could be getting ahead of themselves."
• The semiconductor giant's market capitalization surpassed Amazon's and Alphabet's last week.

Ark Invest's Cathie Wood says she's been selling Nvidia stock because she thinks it's become overvalued.

"It has become a check-the-box stock," Wood said in a podcast with The Wall Street Journal's Dion Rabouin that aired Sunday. "It's surprising hugely on the high side of expectations. And we do think that expectations could be getting ahead of themselves."

Wood's investment fund sold over $4.5 million worth of Nvidia stock this year. The company is set to announce its earnings for the last quarter of 2023 on Wednesday.

"I've watched Nvidia all my career actually since it's gone public. It's a very cyclical stock," she told Rabouin.

Representatives for Nvidia declined to comment when approached by BI.

Wood acknowledged Nvidia had "created the AI age in a sense," but there was also "hyperactivity" surrounding its stock.

"Everyone's excited, trying to get in at the same time, so there's double ordering, triple ordering, quadruple ordering, and then there is an inventory correction," Wood said. "We think that will happen again."

The AI boom has greatly boosted the semiconductor giant's fortunes.

Last week, Nvidia's market capitalization reached $1.8 trillion, surpassing Amazon's and Alphabet's. The 400% surge over the past year meant that Nvidia is now worth just as much as the entire Chinese stock market.

"If AI is the next industrial revolution, then absolutely we could see Nvidia's valuation surge continuing," online broker XTB's Kathleen Brooks told BI in an interview last week.