NVIDIA's 'Faith Divide': Before the Sharp Drop, Citadel and DE Shaw Reduced Positions, While Renaissance Increased Its Stake

How long can the 'AI faith' endure? On this 'gold mine'—NVIDIA—Wall Street giants are engaged in a fierce tug-of-war: some are buying frantically, while others rush to sell. Prominent hedge funds—including Citadel and DE Shaw—reduced their NVIDIA holdings ahead of the company’s recent sharp stock price decline this month, whereas Renaissance Technologies and Marshall Wace increased theirs. Such starkly divergent actions signal profound disagreement across the market regarding NVIDIA’s valuation and growth potential. A high-stakes 'bet' on NVIDIA is unfolding on Wall Street. According to U.S. regulatory filings, Citadel—the most successful hedge fund in history—sold approximately 500,000 shares of NVIDIA in Q2 this year, cutting its stake from $60 million at the end of March to $19 million by the end of June. DE Shaw slashed its holdings by more than half, reducing its position to $1.4 billion in value. Elliott Management, led by billionaire Paul Singer, also exited its entire 50,000-share position and warned investors that NVIDIA is in a 'bubble' and that artificial intelligence is 'overhyped.' While some investors proceed with caution and sell NVIDIA shares, others double down with fervor. Renaissance Technologies—the quantitative investment firm founded by billionaire Jim Simons—bought 1.5 million shares, raising its total stake to 7 million shares, valued at $867 million by end-June. London-based Marshall Wace purchased roughly 3.7 million shares, bringing the value of its holding to $1.5 billion. These investors’ aggressive bets helped propel NVIDIA’s share price up 150% in the first half of this year. Last night, following the release of strong U.S. retail sales and employment data—which significantly bolstered market confidence in the U.S. economy—NVIDIA’s U.S.-listed shares rose 4.05%.

(30) 'Real Records of Value Investing': Case Study on a Business with an Economic Moat—WD-40: A Retrospective Investment Analysis

(Long-term sustainability is unlikely), so assuming a 20% tax rate is appropriate for estimation purposes. ・Estimated 2018 profitability: $62 million ($409 million × 19% × 80% after-tax) ・Assume profits are either distributed to shareholders or actively reinvested (excluding organic growth portion); such active reinvestment yields returns equal to WD-40’s cost of capital. ・Organic growth: ・Aligned with broader macroeconomic trends; as economic growth slows across both developed and developing countries, organic growth has declined from 4% annually to 3%. ・At a 3% organic growth rate, WD-40’s sales growth should amount to $12.3 million annually ($409 million × 3%). ・Since each additional dollar of revenue requires $0.15 in net investment, $2 million in retained earnings is needed to support organic growth. ・Thus, the remaining $60 million in sustainable earnings is available for distribution to investors. ・As of end-September 2018, the acquisition cost of WD-40’s core business comprised $2.392 billion in equity ($172.10 × 13.9 million shares) plus $37 million in net debt, resulting in a total enterprise value of $2.429 billion. ・The $60 million in sustainable annual distributions to shareholders equates to a 2.5% cash yield ($60 million ÷ $2.429 billion). ・Total return = 3% organic growth + 2.5% cash yield (active reinvestment is negligible).

Renaissance Technologies Reduces Stake in WD-40 Company

Jul 28, 2026

Renaissance Technologies reduced its holding in WD-40 Company by 19.3%, while the company reported strong quarterly results beating EPS and revenue expectations with analysts maintaining a Buy rating.

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