雅虎香港財經 Brian's Big Idea on Nvidia (NVDA), Should You Buy Now?
Brian Bolan is the aggressive growth stock strategist at Zacks Investment Research and he has a big idea for people that are wondering if they should buy Nvidia NVDA after the most recent earnings report.
Brian takes a look at the stock following an earnings beat which is the 6th consecutive beat for the stock. Brian mentions that there are dozens of analysts that cover this name at brokerages so the consensus is a fairly deep number. Despite all of that coverage the company continues to outperform expectations.
The company reported earnings per share of $6.12 when the Zacks consensus estimate stood at $5.49. That beat of $0.63 works out to be a positive earnings surprise of 11.5%. Over the last four quarters the average positive earnings surprise has worked out to be 18.4%.
Sales came in at $26B when the expectation was calling for $24.3B. The company then guided next quarter revenue to a range of between $27.4B to $28.6B when the consensus was sitting at $26.2B. When a company guides revenue higher than expectations the stock often moves higher.
Valuation
NVDA trades at a 38x forward earnings multiple, which is a lot but not at the nifty 50 level that a lot of investors are used to seeing for companies that post year over year growth of more than 100% and are expected to show continued growth of 100% in the next quarter. The price to book multiple comes in at 55x and while that may scare off some value investors the idea here is that there is still a lot of growth before this can become a value stock. The price to sales multiple of 29x also feels like a lofty number but again the growth is really there.
Stock Split
On the earnings call the company announced a 10 for 1 stock split. This means that the price of NVIDIA stock will seem to drop dramatically on June 10th, but at the same time you will now have 10 shares for everyone that you own. Brian discusses how retail investors have a hard time stomaching very large point moves even when the stock is trading at $900 or $1000 or $1100.
Along with the stock split the company announced a 150% increase to its dividend.
Zacks Portfolio Managers Love NVDA
There are at least three portfolios run by David Bartosiak, Kevin Cook and Andrew Rocco that all have NVDA in them.
Not surprisingly, NVDA is the top performer for all three of those portfolios.
Blockchain Innovators is run by “Buy and Hold” David Bartosiak and he added shares of NVDA back in April of 2019 at $43 and change. He is sitting on a gain of more than 2300% in that position.
Kevin Cook might be our biggest NVDA bull as he bought shares back in October of 2022 at $125 and is showing a gain of 744% on those shares. Kevin runs the TAZR service which stands for Technical Analysis and Zacks Rank. He also added shares of NVDL, which is a 2x leveraged ETF on NVDA about a month ago and has a 73% return on that position as well.
Finally we have our Tech Innovators service that is managed by Andrew Rocco and he is a little more active of a trader. He added shares to the service on April 29 of 2024 at $875 and is already up 20.5% in just a month on that position.
Should You Buy NVDA
The big question that investors have is should they be buying NVDA right now. The answer, according to Brian Bolan is yes. The company Noted in the release that they are preparing for their next wave of growth. The AI build out continues and now the company is looking at accelerated computing as another growth driver. When a company posts higher than expected revenues and increased margins there is growth in earnings per share. When earnings per share grows and there still looks to be continued momentum on the top line share prices often move higher.
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