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Nancy Pelosi, the Congressional representative from the 11th district in California and former House Speaker, is more than just a dabbler when it comes to stocks. She is known for pouring millions into her favorite companies, while at the same time being fairly ruthless in selling names from her portfolio, as well. There's even an ETF whose ticker symbol is a nod to the San Francisco Democrat, the Unusual Whales Democratic ETF (NANC) - a clear testament to her influence in the market.
So, any big investing moves by the high-powered Democratic Party member are quick to attract the attention of market participants. Most recently, Pelosi made headlines for renewing her bet on AI chip leader Nvidia (NVDA) amid the stock's pullback, and simultaneously unloading shares of software giant Microsoft (MSFT).
Pelosi Buys Nvidia, Sells Microsoft
According to a new disclosure form, Pelosi purchased 10,000 shares of Nvidia on July 26, with the stock trading in a range of about $111 to $116 on the day. Pelosi also disclosed the sale of 5,000 shares of Microsoft valued between $1 million and $5 million.
This appeared to be a smart trade by Pelosi ahead of earnings from Microsoft this week. Following concerns over its Azure numbers for fiscal Q3, Microsoft's shares ended more than 1% lower on Wednesday. At the same time, Microsoft's assertion that it would continue to ramp up capex through fiscal 2025 to meet higher AI demand sent Nvidia shares higher on the session, as Microsoft is a large buyer of Nvidia chips.
Nvidia also got a boost on Wednesday from rival AMD's (AMD) solid Q2 results, which made it even more obvious that AI demand remains strong for the foreseeable future. While NVDA trimmed some of that day's massive 12.8% rally during Thursday's broad-based selling, the shares still settled above their July 30 near-term lows.
So far, it's hard to question Pelosi's timing on the Nvidia dip buy. But the representative's affinity for Nvidia stock is hardly a recent phenomenon.
Pelosi's bullish bet on the chip designer last November reportedly yielded a payoff that more than doubled her government salary in just a couple of months. Then, in June, Pelosi purchased another 10,000 shares of Nvidia.
Significantly, Politico reports that Nvidia is now the target of a Justice Department investigation over its Run:ai acquisition, as well as its chokehold over the AI chip market. Checking the calendar, the timing of Pelosi's purchase of NVDA shares would have coincided with a burst of momentum for the nascent Harris campaign, with the California-based VP expected to take a friendly stance toward Big Tech.
So, with NVDA down 22% from record highs, should you take a cue from Pelosi's vote of confidence in the chipmaker? Let's have a closer look.
About Nvidia Stock
For the uninitiated, Nvidia (NVDA) is a leader in specialized AI semiconductors, and the company also supplies software to support the hardware it provides. More specifically, Nvidia designs and sells graphics processing units (GPUs) for the gaming and professional markets, and system-on-a-chip (SoC) units for the mobile computing market.
Nvidia’s chips are used for various purposes such as data centers, edge-to-cloud computing, the powering of automotive driving technology, cryptocurrency mining, and professional applications. Nvidia's H100 Tensor Core GPU is used as the foundation for AI usage on the data center level. This GPU was the fastest available in the market, and therefore in particularly high demand among companies that require a fast tackling of AI and HPC workloads. Nvidia is currently the leading AI processor manufacturer, with its AI accelerator MI300X to support machine learning set to be made available to users soon.
Trading under a dollar as recently as 2016, the stock recently completed a 10-for-1 stock split to bring its share price back down to earth after a massive two-year rally of about 492%.
Even accounting for its recent correction, NVDA stock is up a whopping 120% on a YTD basis. The stock also offers a modest dividend yield of 0.04%, and is valued at a gargantuan market cap of $2.87 trillion.
In June, Nvidia even briefly took over the No. 1 spot as the most valuable company in the world, elbowing past Big Tech titans like Microsoft (MSFT) and Apple (AAPL).
Although the speed and magnitude of Nvidia's recent pullback might feel alarming, the company's core fundamentals and operational strength appear to be firmly intact.
Nvidia Crushes Earnings Expectations
With expectations on the rise for this month's second-quarter earnings report, it's worth revisiting Nvidia's recent history in the earnings spotlight. In Q1 2025, Nvidia continued its impressive run of beating revenue and earnings expectations.
Specifically, the company reported record quarterly revenues of $26 billion, up a whopping 262% from the previous year, as its core data center revenues shot up by 427% to $22.6 billion. Adjusted EPS rocketed by 461.5% on a YoY basis to $0.61, comfortably beating estimates.
The company generated net cash from operating activities of $15.34 billion, compared to just $2.91 billion in the year-ago quarter. Moreover, Nvidia closed the quarter with a cash balance of $31.44 billion, much higher than its debt levels of $14 billion.
Nvidia has been on a tear for the past five quarters. Not only have they consistently beaten analyst expectations, but they've also delivered impressive quarterly earnings growth.
For Q2 2025, set to be reported on Aug. 28, the company expects revenues of $28 billion. Analysts are forecasting forward revenue growth of 80.21% for Nvidia, compared to the tech sector median of 6.57%.
Overall, the past 10 years have seen the company grow its revenue and EPS at a CAGR of 33.99% and 56%, respectively.
What's Next for Nvidia?
Nvidia unveiled its Blackwell platform of chips in March, and the company is betting big on it. Touted as an improvement over its Hopper architecture, launched two years ago, the Blackwell platform boasts significant improvements in cost and energy efficiency compared to its predecessor. (As context, each of Nvidia's H100 chips consumes 700W of energy at peak operation, which is more than the annual electricity consumption of countries like Georgia, Costa Rica, and Guatemala.)
Blackwell promises to slash costs by up to 25x for tasks like training giant AI models, saving significant power for the same performance. And Nvidia isn't resting; Blackwell's successor, Rubin, is already in the works for a 2026 launch.
Notably, the company has transitioned Blackwell to full production, positioning it as the foundation for trillion-parameter generative AI. Building on Grace CPUs, Blackwell GPUs, NVLink, Quantum, Spectrum, and related technologies, the company aims to develop full-stack hardware. A robust software ecosystem, enhanced by the Nvidia AI Foundry, provides a competitive edge. The company seeks to expand its partner ecosystem across the stack to support AI-driven digital transformation initiatives.
Additionally, Nvidia is reportedly working on an export-compliant version of its most powerful GPU for the Chinese market, which could address a key uncertainty acting as an overhang on the stock right now.
Looking ahead, management is confident in continued growth through 2025 and beyond. This optimism is fueled by the shift to accelerated computing, an explosion of generative AI applications, strong growth in enterprise and consumer internet sectors, and the development of sovereign AI.
Additionally, Nvidia is looking into humanoid AI robots as the next frontier of growth, and has been preparing to serve this market, as well. CEO Jensen Huang has said that there are over 1 million robotics developers in the Nvidia CUDA ecosystem.
Bullish Analysts Are Buying the Dip, Too
Just like Pelosi, Morgan Stanley analyst Joseph Moore and his team are as bullish as ever on the Santa Clara-based company. In a Wednesday note, they said that the recent stock pullback “presents a good entry point" for investors, and added NVDA to its Top Pick list for clients. The brokerage left its price target of $144 and “Overweight” rating unchanged.
Overall, analysts have a consensus rating of "Strong Buy” for NVDA, with the mean target price of $141.29 indicating an upside potential of about 29.4% to current prices. Out of 39 analysts covering the stock, 33 have a “Strong Buy” rating, 2 have a “Moderate Buy” rating, and 4 have a “Hold” rating.
