Nvidia cutting stake isn't a sign to sell Applied Digital stock: here's why

Applied Digital (NASDAQ: APLD) saw its momentum hit a speed bump on Wednesday as shares tanked nearly 10% following a 13F filing that revealed Nvidia has sold its entire “stake” in the AI infrastructure firm. Nvidia originally entered APLD in September 2024, participating in a $160 million funding round at just $3.24 per share. Since then, the Dallas-headquartered firm has been nothing short of a market darling. Heading into Feb. 18, Applied Digital stock was up nearly 25% year-to-date, extending a whopping 237% rally in 2025. Should you follow Nvidia and sell Applied Digital stock? On the surface, Nvidia’s exit feels like a vote of no confidence, but for seasoned investors, context should take precedence. APLD stock was trading at…