Nvidia Stock Declines as Critical Earnings Report Looms

Magnificent Seven stock Nvidia fell on Monday as Wall Street prepared for what one analyst called the “most significant tech income in years.” The Nvidia stock price today is currently $126.46, down -2.25% over the last day.

NVIDIA Corporation offers networking, graphics, and computing solutions both domestically in the US and internationally, including in Hong Kong, China, Taiwan, and other countries. Its Graphics segment provides Quadro/NVIDIA RTX GPUs for enterprise workstation graphics, virtual GPU (vGPU) software for cloud-based visual and virtual computing, automotive platforms for infotainment systems, and Omniverse software for creating and managing metaverse and 3D internet applications.

Additionally, NVIDIA offers the GeForce NOW game streaming platform, related infrastructure, and GeForce GPUs for gaming and PCs.

The Compute & Networking segment includes NVIDIA DRIVE, an automated driving platform, along with Jetson Robotics, automotive development agreements, and other platforms. This segment also covers NVIDIA AI Enterprise, DGX Cloud software and services, as well as data center computing. Additionally, it offers end-to-end networking platforms, including Quantum for InfiniBand and Spectrum for Ethernet.

The All Other segment encompasses expenses that don’t directly relate to Nvidia’s main product segments. This includes costs associated with stock-based compensation, corporate infrastructure and support, acquisition-related activities, legal settlements, and other one-time charges. These expenses, while not tied to specific product lines, are crucial for maintaining Nvidia’s overall operations and corporate structure.

Nvidia Stock Forecast

The Magnificent Seven stock, Nvidia trades inside the Bollinger Bands (BB) in terms of price movement, with the lower band at $76.68 and the upper band at $143.55. Given Nvidia’s recent breakout from the lower band, $100 may be a crucial level of support.

On the plus side, Nvidia might retest its earlier highs around $150 if it breaks above the resistance level of $120, validating the bullish scenario.

It’s important to remember that the massive semiconductor company has been trying to stabilise itself after going through a lot of volatility at the beginning of August. Investors predict that NVDA will see more upside before the earnings report, especially given the expectation that the tech company will meet targets.

Analysts are projecting a strong performance in line with this. The company’s earnings Per Share (EPS) should increase 138% from the previous year to $0.64. Estimates for Nvidia revenue, which would represent a 113% increase over the same quarter last year at $28.71 billion, are also expected to be impressive.

Above all, the focus will be on Nvidia’s ability to show how its artificial intelligence (AI) processor customers are making money. According to some analysts, NVDA is expected to reach $150 if the chipmaker reports positive earnings.

With a high Nvidia stock forecast of $200.00 and a low forecast of $100.00, the average price target is $149.89. The change from the previous price of $126.46 to the average price target is 18.53%.

The sentiment around Nvidia stock is cautiously optimistic. Investors expect further upside before the earnings report, driven by Nvidia’s AI processors and strong growth projections. While recent volatility is acknowledged, the stock’s potential to break key resistance levels suggests a bullish outlook.

NVDA/USD 5-Day Chart

Nvidia Stock Chart

Nvidia stock previously closed at $126.46, opened at $129.57, and traded between $124.37 and $131.26 for the day. The stock has a 52-week range of $39.23 to $140.76.

Nvidia reported revenue of $79.77 billion, with revenue per share of $3.23 and a quarterly revenue growth of 262.10%. EBITDA stands at $49.27 billion, while net income available to common shareholders is $42.6 billion, translating to a diluted EPS of $1.71 and quarterly earnings growth of 628.40%.

The company holds $31.44 billion in total cash, or $1.28 per share, and has a total debt of $11.24 billion, resulting in a debt-to-equity ratio of 22.87%. Additionally, Nvidia has a current ratio of 3.53, a book value per share of $2.00, an operating cash flow of $40.52 billion, and a levered free cash flow of $29.02 billion.

Other chart info:

Profit Margin: 53.40%
Operating Margin: 64.93%
Return on Assets: 49.10%
Return on Equity: 115.66%
Revenue: $79.77B
Revenue Per Share: $3.23
Quarterly Revenue Growth: 262.10%

Price History

Beta: 1.68
52 Week Range: 159.22%
S&P 500 52-Week Change: 24.88%
52 Week High: 140.76
52 Week Low: 39.23
50-Day Moving Average: 120.84
200-Day Moving Average: 86.48
Avg Vol (3 month): 360.72M
Avg Vol (10 days): 317.94M

Nvidia has 24.6 billion shares outstanding and an implied 25.17 billion shares, with a float of 23.61 billion. Insiders and institutions hold 4.29% and 66.75% of shares, respectively. As of July 31, 2024, there were 275.2 million shares short, with a short ratio of 0.94. The short percentages were 1.17% of the float and 1.12% of shares outstanding, down from 300.42 million shares short the previous month.

The forward annual dividend rate is $0.04, with a yield of 0.03%, while the trailing annual dividend rate is $0.02, yielding 0.01%. Nvidia has a 5-year average yield of 0.11% and a payout ratio of 0.94%. The most recent dividend date was June 28, 2024, with an ex-dividend date of June 11, 2024. The last stock split was a 10:1 on June 10, 2024.

Nvidia Stock News

Stock investors are looking forward to Nvidia’s (NVDA) upcoming earnings report on August 28. Technical indicators for the stock have identified important short-term price levels to watch.

Nvidia gained almost 5% in the last 24 hours, closing the most recent trading session at $129. The stock is up 4% on the weekly chart.

On August 26, Nvidia saw nearly a 1% increase in premarket trading, closing at $130 after ending the prior session at $129.

Over the past three quarters, Nvidia’s earnings have grown by an average of 500%, while sales growth has ranged from 206% to 265% during the same period.

On May 22, the company reported fiscal Q1 revenue growth of 262%, reaching $26 billion, with profits per share increasing by 455% to 61 cents.

Looking ahead, analysts expect Nvidia, a leader in AI, to report earnings on Wednesday after the market closes. Sales are projected to increase by 113% to $28.7 billion, while Wall Street forecasts a 139% rise in earnings, reaching 65 cents per share. For the full fiscal year, analysts predict a 109% increase in earnings to $2.72 per share.

Final Thoughts

In conclusion, as we approach fiscal 2025, Nvidia stock remains a strong buy according to analysts, with significant growth potential driven by its leadership in AI and strong financial performance. However, investors should not rely solely on technical analysis when making decisions; a comprehensive evaluation, including fundamental factors and market trends, is essential. It’s also important to consider the broader economic environment and potential risks that could impact Nvidia’s long-term outlook.

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