New: Cathie Wood calls Nvidia stock 'overpriced' after missing 2023 rally

Cathie Wood, the founder of Ark Invest, known for her investments in innovative technology, expressed skepticism about the artificial intelligence (AI) hype surrounding Nvidia. In a tweet on Monday, Wood stated that the AI-focused company is now overpriced. She acknowledged that Ark Invest has recognized Nvidia's early potential in the AI field since 2014 but believes that the stock is priced ahead of its actual value at 25 times the expected revenue for this year.

Despite Wood's previous holdings in Nvidia, which were sold in January, the company's stock has more than doubled, reaching a market cap of $1 trillion following positive earnings reports and the announcement of new AI-focused products. The AI sector has experienced a broader rally, with Marvell Technology also anticipating a doubling of AI-related revenue in the next year, leading to a significant rise in its stock price.

Wood argues that there will be multiple winners in the AI space beyond Nvidia, particularly highlighting Tesla as a standout beneficiary. She notes that Tesla, with its aim for a revenue total addressable market of $8-10 trillion in autonomous mobility by 2030, has a much lower valuation at six times revenue compared to Nvidia.

Wood believes that other companies with visionary leaders, global distribution networks, and substantial proprietary data will also be successful in the AI field, surpassing revenue and earnings expectations in the coming years. She predicts that there will be "dozens" of such winners.

While Wood's comments on Nvidia come at a time when her flagship ETF, the Ark Innovation Fund, has faced challenges in returning to its previous pandemic-era dominance, Tesla has been making positive headlines and experiencing a stock price increase amid the broader tech rally. The Ark Innovation Fund saw significant growth during the risk-on bull market of 2020, driven by investments in companies like Tesla, Zoom, and Nvidia. However, as the Federal Reserve implemented an aggressive interest rate hike campaign, investor preferences shifted away from riskier bets, leading to declines in some of Ark's top holdings and the fund's market cap.