Nvidia (NVDA 0.78%) and Chipotle Mexican Grill (CMG 0.90%) are both top companies. Nvidia is key in the AI sector, while Chipotle has a strong brand in fast-casual dining. Both recently split their stocks due to rising prices.

Despite their successes, top hedge fund managers sold Nvidia shares in the second quarter while buying Chipotle shares:

  • Cliff Asness (AQR) sold 1.3 million Nvidia shares and bought 673,292 Chipotle shares.
  • Israel Englander (Millennium) sold 672,242 Nvidia shares and purchased 3.5 million Chipotle shares.
  • Steven Cohen (Point72) sold 409,042 Nvidia shares and bought 1.4 million Chipotle shares.
  • Steven Schonfeld (Schonfeld Strategic) sold 370,349 Nvidia shares and acquired 131,715 Chipotle shares.

This doesn’t mean Nvidia is a bad investment; these managers still hold significant Nvidia shares. For example, it remains AQR’s largest investment.

1. Nvidia

Nvidia is a leader in the AI field, dominating with a market share of 80% in AI accelerators. Its GPUs are crucial for AI data processing. Analyst Vivek Arya raised Nvidia’s price target to $190, expecting its market share to remain high over the next few years.

Nvidia’s recent performance was strong, with revenue up 122% to $30 billion in Q2 2025, mainly driven by AI demands. Upcoming innovations, like their next-gen GPU, Blackwell, promise further growth, as orders are already booked for the next year.

Even though hedge fund managers sold shares earlier, Nvidia’s current valuation and strong earnings projections make it an appealing investment. The price-to-earnings (P/E) ratio is now 64.7, with significant earnings growth expected.

2. Chipotle Mexican Grill

Chipotle runs over 3,500 restaurants and is praised for its commitment to “food with integrity.” Their focus on quality ingredients has boosted sales and customer loyalty.

The company posted an 18% revenue increase to $3 billion in Q2, mainly due to higher customer traffic and larger orders. Former CEO Brian Niccol emphasized their efforts in improving service speed and efficiency.

While hedge fund managers were buying Chipotle shares recently, the current price-to-earnings ratio of 58.2 indicates it could still be pricey. A PEG ratio of 2.6 suggests investors should wait for a price drop before buying.