Nvidia Gains, Beats Q4 Earnings Estimates: ETFs to Tap
Nvidia NVDA cheered investors with its solid fourth-quarter fiscal 2023 results, wherein it topped both earnings and revenue estimates. It also offered a bullish revenue outlook for the current quarter.
Following the robust results and strong guidance, Nvidia shares spiked as much as 9.1% in after-market trading on elevated volume. Investors could tap the strength with the help of ETFs having the largest allocation to NVIDIA in focus. These include AXS Esoterica NextG Economy ETF WUGI, Pacer Data and Digital Revolution ETF TRFK, The Spear Alpha ETF SPRX, VanEck Vectors Semiconductor ETF SMH and VanEck Vectors Video Gaming and eSports ETF ESPO.
Nvidia Earnings in Focus
Earnings per share came in at 88 cents, missing the Zacks Consensus Estimate of 81 cents and declining 33% from the year-ago earnings. Revenues dropped 21% year over year to $6.05 billion but edged past the consensus mark of $6.01 billion. Nvidia’s push into artificial intelligence (AI) computing chips is paying off and offestting sluggish demand for personal computer chips.
Data center revenues rose 11% year over year, while gaming revenues were down 46% from a year ago (read: 5 Stocks Powering Nasdaq ETF to Start 2023).
For the first quarter of fiscal 2024, the graphics chipmaker expects revenues of around $6.5 billion, plus or minus 2%. Nvidia believes demand for its artificial intelligence and data-center chips will remain strong though it continues to struggle with a slowdown in the personal computer market.
ETFs in Focus
Let’s delve into each ETF below:
AXS Esoterica NextG Economy ETF (WUGI)
AXS Esoterica NextG Economy ETF is an actively managed ETF that invests in stocks of companies that benefit from the ever-evolving digital economy. It holds 29 stocks in the basket, with Nvidia occupying the top position at 10.9%. AXS Esoterica NextG Economy ETF has key holdings in electronic compo-semiconductor, applications software and computer software.
AXS Esoterica NextG Economy ETF has accumulated $18.5 million in its asset base and charges 75 bps in fees per year. It trades in an average daily volume of 2,000 shares.
Pacer Data and Digital Revolution ETF (TRFK)
Pacer Data and Digital Revolution ETF aims to offer investors exposure to the globally listed stocks and depositary receipts of data and digital revolution companies. It follows the Pacer Data Transmission and Communication Revolution Index, holding 82 stocks in its basket. Out of these, Nvidia is the second firm, accounting for a 9.8% share. Semiconductors take the largest share at 31.8%, while communication equipment and system software round off the next two spots.
Pacer Data and Digital Revolution ETF debuted in the space in June and has accumulated $1 million in its asset base. It has an expense ratio of 0.60%. TRFK trades in a meager volume of under 500 shares per day on average.
The Spear Alpha ETF (SPRX)
The Spear Alpha ETF is an actively managed fund that invests in companies poised to benefit from breakthrough trends in industrial technology. The ETF’s objective is to find underappreciated opportunities across different industrial supply chains that are beneficiaries of secular themes such as environmental focus and decarbonization, manufacturing digitalization, automation & robotics, photonics and additive manufacturing, space exploration, and artificial intelligence. The Spear Alpha ETF holds 22 stocks in its basket, with Nvidia taking the second spot at a 9.8% share.
The Spear Alpha ETF has accumulated $2.5 million in its asset base and charges 75 bps in annual fees. It trades in an average daily volume of 1,000 shares.
VanEck Vectors Semiconductor ETF (SMH)
VanEck Vectors Semiconductor ETF offers exposure to the companies involved in semiconductor production and equipment. SMH follows the MVIS US Listed Semiconductor 25 Index, which tracks the most-liquid companies in the industry based on market capitalization and trading volume. VanEck Vectors Semiconductor ETF holds 25 stocks in its basket, with Nvidia occupying the second position at 9.6% (read: Semiconductor ETFs Shining Amid Mixed Numbers in Q4 Earnings).
VanEck Vectors Semiconductor ETF has managed assets worth $7.3 billion and charges 35 bps in annual fees and expenses. SMH is heavily traded with a volume of 3 million shares per day and has a Zacks ETF Rank #1 (Strong Buy) with a High risk outlook.
VanEck Vectors Video Gaming and eSports ETF (ESPO)
VanEck Video Gaming and eSports ETF offers exposure to global companies involved in video game development, e-sports and related hardware and software by tracking the MVIS Global Video Gaming and eSports Index. ESPO holds 26 stocks, with NVIDIA taking the second spot with an 8.8% share. VanEck Video Gaming and eSports ETF is inclined toward American firms, which account for 43% of the portfolio, while Japan and China round off the next two with a double-digit allocation each.
VanEck Video Gaming and eSports ETF has gathered $272.6 million in its asset base while trading in an average daily volume of 37,000 shares. ESPO charges 56 bps in annual fees from investors.
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NVIDIA Corporation (NVDA) : Free Stock Analysis Report
VanEck Semiconductor ETF (SMH): ETF Research Reports
VanEck Video Gaming and eSports ETF (ESPO): ETF Research Reports
AXS Esoterica NextG Economy ETF (WUGI): ETF Research Reports
Spear Alpha ETF (SPRX): ETF Research Reports
Pacer Data and Digital Revolution ETF (TRFK): ETF Research Reports
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