Bulls vs. bears: SA analysts speak out before Nvidia earnings
BING-JHEN HONG
The Bulls
"The firm is the undisputed leader in AI chips, and despite a sky-high valuation and an incredible runup this year, the stock appears poised to beat earnings on Wednesday after the bell," Christopher Robb declares in Nvidia Is Poised For Another Earnings Blowout, citing a few key reasons why Nvidia (NASDAQ:NVDA) can "repeat something comparable to the fireworks achieved last quarter." Also check out Investing Group Leader Tom Lloyd's technical analysis update in Nvidia: Buying Starts Ahead Of Earnings.
"By applying a ~33x multiple, the stock should trade around $625," SA analyst Ajay Singh notes in Nvidia: Why I Believe The Recent Dip Is An Opportunity. "The introduction of DGX Cloud, a gateway to an AI factory in the cloud, is gaining traction and driving migration of workloads to the cloud. Nvidia's (NVDA) native support for FP8 in its H100 product gives it a competitive edge in AI processing, offering higher performance and accuracy."
"Despite solid demand for its AI chips, certain analysts and investors are preparing for an underwhelming earnings guidance from Nvidia (NVDA) following disappointing forecasts from its key suppliers," Nexus Research writes in Nvidia Q2 Earnings: Don't Be Too Fearful. "Investors need to understand that Nvidia (NVDA) was much better prepared for the AI revolution than any of its rivals and suppliers."
The Bears
"There's no denying that Nvidia (NVDA) has done well for itself in spite of a global macroeconomic slowdown in recent quarters, but I contend that its streak of outperformance is likely to fizzle out soon," Business Quant says in Nvidia Q2: Party May Be Over. "Pay close attention to its purchase obligations, segment revenue and its management's guidance."
"My last two bearish articles about Nvidia (NVDA) stock did not age well because I underestimated the strength of the momentum caused by the AI frenzy," SA analyst Dair Sansyzbayev explains in Nvidia: Don't Be The Greatest Fool. "Nvidia (NVDA) stock is overvalued even with wildly optimistic assumptions, and the current market cap is higher than the cumulative revenue over the next decade."
"Nvidia's (NVDA) value proposition, returns on management, and enterprise downside risks suggest a long-term hold or watch," adds Investing Group Leader David J. Waldron in Nvidia Stock: Near-Term Sell Or Avoid On Present Value. "However, Nvidia (NVDA) stock's shareholder yields, valuation multiples, and share price downside risks indicate a sell or avoid."
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