180.35 +0.14 (0.08%)
Pre-Market: 8:22AM EDT
|Bid||180.35 x 1100|
|Ask||180.34 x 2200|
|Day's Range||178.50 - 181.60|
|52 Week Range||124.46 - 292.76|
|Beta (3Y Monthly)||2.44|
|PE Ratio (TTM)||40.63|
|Earnings Date||Nov 13, 2019 - Nov 18, 2019|
|Forward Dividend & Yield||0.64 (0.35%)|
|1y Target Est||186.31|
NVIDIA stock has fallen more than 1% as of 10:21 AM ET. The stock fell after DZ Bank analyst Ingo Wermann downgraded it to a “sell” from a “hold” rating.
America's nearly two-year-old trade war with China, as well as salvos with Europe and Mexico, has battered a wide swath of stocks. President Donald Trump's tariffs (and retaliatory duties) have weighed on companies in various forms, such as higher input costs and unsold inventory.The pinch is being felt on a wide scale. Global growth was already slowing, though market analysts and foreign leaders alike think the trade war is making things worse. Here at home, manufacturing is thinning, reflecting waning demand. ISM's purchasing managers' index reading for August was just 49.1. Anything under 50 signals a contraction in activity, meaning August was the first month in three years that American manufacturing receded.The result has been a pullback in numerous stocks. Buying these tariff-assisted dips is risky because some of the companies face headwinds outside of trade uncertainty. But a resolution between the U.S. and China would bring much-needed relief to many companies, and perhaps a bounceback in their shares. You can see the potential every time the market rallies on the smallest of optimistic hints."(These) value stocks will deliver attractive returns after the tariff resolution, like a coiled spring that pops up," says Michael Underhill, chief investment officer of Capital Innovations in Pewaukee, Wisconsin. He thinks the market could continue to move higher heading into October's negotiations. If more concrete progress is made, a sustained rally will continue, he says.Here, then, are 14 stocks that have already felt the burn from President Donald Trump's tariffs (and retaliatory taxes). Some represent potential should Washington reel in its tariff threats, but they may continue to suffer any time trade tensions reignite. And a few are trying to pivot their businesses out of harm's way. SEE ALSO: 25 Dividend Stocks That Analysts Love the Most
Moody's Investors Service ("Moody's") upgraded Advanced Micro Devices, Inc.'s ("AMD") corporate family rating to Ba2 from Ba3 and senior unsecured rating to Ba3 from B1. The speculative grade liquidity rating of SGL-1 remains unchanged.
The trade war between the U.S. and China has been hard on many U.S. companies but it has been especially difficult for the semiconductor industry. Chipmakers like Nvidia (NASDAQ:NVDA) rely heavily on the Chinese market so the trade war created additional uncertainty for these companies -- and Nvidia stock. Source: Pe3k / Shutterstock.com In short, Nvidia stock has been all over the place over the past year. 2018 was a breakout year for the company and a year ago, NVDA was nearing $300 per share. The stock is down 32% since then and it started 2019 at a new 52-week low of $124.46. However, the overall sentiment from analysts seems to be mostly positive when it comes to Nvidia. According to TipRanks, Nvidia stock is considered a moderate buy. 20 analysts gave the company a buy rating and the average price target is $189.27.InvestorPlace - Stock Market News, Stock Advice & Trading Tips * 7 Discount Retail Stocks to Buy for a Recession The trade war will continue to cause headwinds for NVDA and no one knows when that situation will improve. But if you take a long-term perspective when it comes to NVDA stock, there are signs that the chipmaker can turn things around. Nvidia Stock is Recovering From Crypto-Mining CrashNvidia's rocky year can't entirely be blamed on trade war problems. The chipmaker has been recovering from the 2018 crypto-mining crash that left it with an excess of inventory and declining sales. Of all the companies affected, the crash hit Nvidia the hardest, in part because it focuses solely on graphics processing units (GPUs). The company's GPUs are used for competitive gaming, data centers, and the automotive industry. Its competitor, Advanced Micro Devices (NASDAQ:AMD) also sells CPUs so the crash didn't affect it in the same way.The most recent earnings report showed that the company's fundamentals are starting to improve. Nvidia experienced growth across all of its segments. And while revenue still isn't back to where it was a year ago, this signals that the company is beginning to turn things around. NVDA's Automotive Business Shows PromiseFor investors, one of the bright spots of Nvidia's most recent earnings report is its growing automotive segment. Its revenue grew by over 30% during the most recent quarter. This segment is still just a small percentage of the company's total business but there is significant potential there.Self-driving vehicles are inevitable and Nvidia's GPU chips can power these systems. Of course, there's still a lot of work to do before self-driving cars are ready for the road. But companies are investing a lot of money in this industry so it provides an incredible long-term opportunity for Nvidia. Nvidia's Gaming Strength is ReturningNvidia's real strength is in its gaming segment and it's where the company makes most of its revenue. Last year, the company released an updated version of its graphics cards which used a technology known as ray tracing. This technology improves the images in online gaming.Nvidia's gaming revenue is slowly starting to bounce back, though it's still down from a year earlier. This should continue to improve during the second half of the year as the holidays approach. All in all, the company isn't out of the woods just yet and the current market volatility could cause Nvidia stock to fall again. But the company has many opportunities it can capitalize on. This could make it a good long-term growth stock.As of this writing, Jamie Johnson did not hold a position in any of the aforementioned stocks. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 Big IPO Stocks From 2019 to Watch * 7 Discount Retail Stocks to Buy for a Recession * 7 Stocks to Buy Benefiting From Millennial Money The post 3 Reasons the Nvidia Stock Comeback Story Will Continue appeared first on InvestorPlace.
Is now the time to invest in Nvidia (NASDAQ:NVDA)? Nvidia stock has been on a bit of a run this month, up 12% since September 3. NVDA has gained an impressive 38% so far in 2019 -- yet remains far from the $281 highs it hit last October.Source: Hairem / Shutterstock.com The majority of analysts have it as a buy. However, despite their bullish attitude, at its current $184 level, there is little upside to buying now, when those same analysts have an average 12-month price target for NVDA of $189.27.Should you buy Nvidia stock at this point? Does it have the potential to continue growing, or has NVDA pretty much run out of steam?InvestorPlace - Stock Market News, Stock Advice & Trading Tips AI Is a Future Nvidia Stock CatalystThere is much to be said about NVDA's long term potential when it comes to AI. The company has been investing heavily in this area, looking to machine learning and autonomous vehicles as future growth areas. InvestorPlace's Chris Lau has a good read on how AI and self-driving car tech could pay off for Nvidia stock in the long term. * 10 Battered Tech Stocks to Buy Now But I want to focus on gaming because that is the area that is going to hold Nvidia back over the next year. Nvidia Missed the Gaming Console Ramp-UpMicrosoft (NASDAQ:MSFT) and Sony (NYSE:SNE) are releasing next-generation Xbox and Playstation game consoles in 2020. That is going to kick off a huge upgrade cycle, but it won't benefit NVDA. Advanced Micro Devices (NASDAQ:AMD) will be powering both of those consoles.The Nintendo Switch uses custom Nvidia silicon, but with the Switch still mid-cycle in its lifespan, an all-new version isn't expected any time soon. Nvidia stock is not going to see the sort of upside from Switch sales that it did when Nintendo's console first launched.Nvidia is also left in the cold on the most prominent experiment in video game streaming. Alphabet's (NASDAQ:GOOG, NASDAQ:GOOGL) Google is launching its Stadia cloud game streaming service in November. Stadia is a double-blow against Nvidia.Subscribers will be able to play AAA PC video game titles on a wide range of devices without the need for a powerful gaming PC equipped with a graphics card. Instead, cloud data centers will do the heaving lifting, with custom AMD GPUs delivering 4K graphics at 60 fps (with 8k and 120 fps on the horizon).If Google's Stadia is a success, AMD will get orders for more of those custom GPUs. Nvidia will likely see the demand for graphics cards to power gaming PCs take a hit. Putting Together the Pieces for Nvidia StockIf you look at the two factors spiked out here, the somewhat puzzling analyst positions make sense. Why would do many analysts have NVDA rated as a Buy, yet have 12-month price target that has only around 3% upside? The next year doesn't have a lot of revenue growth potential for Nvidia. It's largely missing out on the next-generation game console cycle, it's missing out on the biggest cloud gaming initiative, and it could see its graphics card sales take a hit should cloud gaming take off.At the same time, its investment in AI and autonomous driving technology is seen as likely to pay off in a big way, but that payday is further in the future. Putting all the pieces together, it seems probable that NVDA stock is approaching a ceiling. Buying now, you are unlikely to see major gains over the next year. But if you intend to hold onto it -- with AI ramping up and autonomous cars inching closer to mainstream -- that NVDA investment will pay off in the long term. As of this writing, Brad Moon did not hold a position in any of the aforementioned securities. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 Big IPO Stocks From 2019 to Watch * 7 Discount Retail Stocks to Buy for a Recession * 7 Stocks to Buy Benefiting From Millennial Money The post Keep Nvidia Stock If You Have It, Just Don't Jump in Now appeared first on InvestorPlace.
Shares of computer and gaming-graphics chipmaker Nvidia slip on Friday after the company receives a downgrade to sell from hold from DZ Bank.
Terms like buy range, extended and shakeout may sound foreign to new investors.But they can help you know when to buy stocks correctly and maximize gains.
In the nearly-eight years Ginni Rometty has served as CEO of International Business Machines (NYSE:IBM), IBM stock has lost 23% of its value. From the shares' peak in early 2013, while her predecessor's initiatives were still in motion, the IBM stock price has fallen 33%.Source: JHVEPhoto / Shutterstock.com The performance of IBM stock, of course, merely reflects the company's financial performance. Its revenue peaked in 2011, and its profits peaked in the following year. Although IBM has managed to occasionally grow its top and bottom lines, they have continued to decline in the longer term.There's one underlying reason why IBM has failed to grow, causing International Business Machines stock to struggle, in an environment where seemingly every other technology giant has managed to do so. That is, the company is offering the wrong products at the wrong time at the wrong price.InvestorPlace - Stock Market News, Stock Advice & Trading Tips * 10 Battered Tech Stocks to Buy Now The more nuanced answer, however, is that Rometty, its CEO, isn't getting the job done. Missed OpportunitiesGinni Rometty is a well-polished executive who says all the right things, impresses in public forums, and has avoided the type of scandals that generally lead to CEOs being removed from their position.She's also been a loyal IBM employee, starting with the company in 1981 as a ground-level systems analyst. No one can deny she's earned her way to the company's top spot, having done many of the jobs other IBM employees are doing now.But she's been calling the shots for eight years. That's an eight-year stretch during which Amazon.com (NASDAQ:AMZN) became the world's cloud-computing leader … a business the e-commerce giant arguably had no business getting into. During the same eight years, Nvidia (NASDAQ:NVDA) became a go-to provider of artificial intelligence hardware, a business it practically stumbled into, at first.In both sectors, IBM could have made a big dent. Instead, it put out more more-of-the-same mainframes, and a Watson AI platform that hasn't always been impressive. Indeed, Watson has been frequently criticized as not being "real" artificial intelligence.Rometty didn't program the AI algorithms that Watson utilizes, nor did she assemble the hardware that runs it.She absolutely could have pushed the company in different directions, though. International Business Machines Is Out of TouchThe balance between the experience that tends to come with age and the understanding of "new" that tends to come with youth is a tricky one. Both are needed in the workplace, though how much of each is needed can vary as time passes.Perhaps those critics who argue the 62-year-old Rometty isn't quite plugged into the pulse of the tech world have a valid point.Meanwhile,asWill Ashworth pointed out last month, the average age of IBM's board members is 64.The internet didn't even become popularized until more than a decade after they graduated from college. Cloud computing didn't proliferate until more than a couple of decades after they graduated from college. Smartphones weren't widely popular until nearly three decades after they got out of college.That's not to suggest that anyone over the age of 30 can't learn about newer technologies. They can, and do.But the internet and cloud computing are now the centerpieces of how we live our lives, centerpieces that most people under the age of 30 don't remember living without. It's a cultural component that a group of people in their 60s can never fully understand.Consequently, it's likely this group of older adults -- the Board of Directors and Rometty -- are guilty of collectively misunderstanding the tech world and today's companies, and then supporting one another's misunderstandings.There's also a decent-sized chance that Rometty's 38 years with IBM are more of a liability than a benefit. After almost four decades of absorbing the same corporate culture, bad habits and a misguided vision of the future become extremely ingrained.Whatever the case, the argument that IBM's leadership isn't getting the job done holds water. The Bottom Line on IBM StockThat argument is just food for thought for the owners of IBM stock, and it's certainly not the first time the idea has been floated. It's worth floating again, however, because the market seems to perpetually avoid a serious discussion of Rometty's tepid results.Or, voiced in different terms, IBM may be doing the same thing over and over again and expecting a different result, which is, of course, the unofficial definition of insanity .On Oct. 25, Rometty will celebrate the eighth anniversary of her hiring as CEO. Perhaps that milestone will prompt some scrutiny and pressure from the key owners of International Business Machines stock .As of this writing, James Brumley did not hold a position in any of the aforementioned securities. You can learn more about him at his website jamesbrumley.com, or follow him on Twitter, at @jbrumley. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 Battered Tech Stocks to Buy Now * 7 Strong-Buy Stocks Hedge Funds Are Buying Now * The 7 Best Penny Stocks to Buy The post IBM Stock Can't Take a Ninth Year of More-of-the-Same appeared first on InvestorPlace.
Yesterday, President Trump tweeted that he would delay the upcoming hike on the China tariffs. US semiconductor companies are sensitive to trade wars.
Zumiez, Vista Outdoor, Nvidia, Intel and Tokyo Electron highlighted as Zacks Bull and Bear of the Day
Advanced Micro Devices (NASDAQ:AMD) is having a great year in the markets with AMD stock up 64% year to date through September 10. As a result, AMD bulls are probably calling for $40. Source: JHVEPhoto / Shutterstock.com However, if AMD insider buying, or the lack thereof, is a sign of a coming correction, you might want to reconsider buying above $30. Here's why. Insider Selling Far GreaterA quick look at insider buying and selling of Advanced Micro Devices stock shows that there have been no insider buys on the open market over the past three and 12 months. InvestorPlace - Stock Market News, Stock Advice & Trading TipsMeanwhile, there have been 18 sells over the past three months for a total of 1.66 million shares. Over the past 12 months, there have been 55 sells on the open market for a total of 39.04 million shares. * 10 Stocks to Sell in Market-Cursed September There are many reasons why insiders sell a stock. There's only one reason they buy, because it's cheap. The fact that insiders haven't bought one share of AMD stock on the open market should scare you, especially when you compare it to the insider buying and selling at its peers. Insider Buying and Selling - Past 12 MonthsCompany of Buys of SellsShares BoughtShares SoldAMD 0 55 0 39,044,980 Intel (NASDAQ:INTC) 5 106 32,159 491,317 Nvidia (NASDAQ:NVDA) 26 50 1,642,184 2,266,839 Source: Nasdaq.comI suppose you could argue that because the AMD stock price is the cheapest of the three stocks by dollar value, an insider would have to sell more shares to obtain the same amount of cash from a sale.However, if we use the midpoint between the three stocks' highs and lows over the past 52 weeks, you'll see that AMD insiders sold a lot more stock by dollar value. AMD midpoint = $25.86 * 39.04 million shares = $1.0 billionIntel midpoint = $50.98 * 491,317 shares = $25.0 million Nvidia midpoint = $208.61 * 2.27 million shares = $472.9 million Nvidia Insiders Did a Lot of BuyingThe most interesting observation from the above data is that Nvidia insiders didn't sell nearly as much stock over the past 12 months as AMD insiders did when you factor in the buying. Based on Nvidia's midpoint for both buying and selling, Nvidia insiders on a net basis only sold $130.3 million of its stock; Intel insiders sold $23.4 million of its stock on a net basis and AMD insiders sold a whopping $1 billion. Any way you slice it, AMD insiders have been cashing in on their stock's massive gains in 2019. But why no buying on the open market? Surely, if AMD stock is worth $40, insiders would be buying?Northland Securities analyst Gus Richard has an outperform rating on AMD and a 12-month price target of $36. Of the 37 analysts covering AMD stock, only 13 have an overweight or buy rating with four either rating it underweight or sell. The vast majority (20) rate it a hold. As for a target price, the high is $44, the low is $8, and the average is $32.63. Perhaps that's why insiders are doing zero buying and lots of selling. Should You Buy AMD Stock?If you believe that insider buying is a sign that a stock is selling below its intrinsic value, as I do, you can't possibly think AMD is a value above $30. Without any new catalysts on the horizon, you might want to wait until it's trading closer to its midpoint around $25. The insiders probably will. At the time of this writing Will Ashworth did not hold a position in any of the aforementioned securities. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 Stocks to Sell in Market-Cursed September * 7 of the Worst IPO Stocks in 2019 * 7 Best Stocks That Crushed It This Earnings Season The post The Lack of Insiders Buying AMD Stock Should Scare You appeared first on InvestorPlace.
Nvidia (NASDAQ:NVDA) stock has been on a nice bull run, going from $154 in early August to $183. But then again, there has been a thawing of the U.S.-China trade war. In the meantime, the overall markets have been marching upward, coming to within a few percentage points of an all-time high.Source: Pe3k / Shutterstock.com It's also encouraging for NVDA stock that the AI (Artificial Intelligence) revolution remains particularly strong. Bu it seems as if just about all tech companies have some type of AI strategy! And even more importantly, the mega tech operators like Microsoft (NASDAQ:MSFT), Alphabet (NASDAQ:GOOGL, NASDAQ:GOOG) and Facebook (NASDAQ:FB) are investing billions in the category.But even with this secular trend, there are still nagging issues with Nvidia stock. Let's face it, as we've seen over the past few years, there have been several rallies that have quickly petered out. And I think that this could happen again.InvestorPlace - Stock Market News, Stock Advice & Trading Tips * 10 Healthcare Stocks to Buy Despite the Headlines So let's take a look at three things to worry about Nvidia stock: Nvidia Stock and TradeOK… it seems like the concerns about the trade war have been overwrought. After all, hans't NVDA been able to hold up fairly well?This is true. The company has a top-notch management team and also has the benefit of global scale.But even though the U.S. and China have been showing signs of cooperation, an agreement still looks dicey. As a result, there is likely to be continued uncertainty, which could dampen the demand for chips but also lead to disruption of supply chains.There is also the wildcard about the proposed acquisition of Mellanox (NASDAQ:MLNX). For the most part, the deal looks spot-on as it will help bolster the critical data center market.Yet the problem is that the transaction may ultimately be blocked. Why? The reason is that China may want to retaliate against actions the U.S. has taken against companies like Huawei. Keep in mind that the bid-ask spread is quite large on the pricing for the MLNX deal. And besides, China has already shown its willingness to fight back, as seen with the blocking of Qualcomm's (NASDAQ:QCOM) attempted acquisition of NXP Semiconductors (NASDAQ:NXPI). NVDA's CompetitionUntil recently, NVDA did not have to really worry about competition. The company was the pioneer of GPUs (Graphics Processing Units) and quickly dominated the gaming market. NVDA also was smart to leverage this technology into other categories like the data center and AI.But nowadays other chip companies have been catching up. Just look at Advanced Micro Devices (NASDAQ:AMD). Once a marginal player -- and near bankruptcy -- the company has pulled off an impressive turnaround. CEO Lisa Su has focused obsessively on pushing innovation, such as with the launch of the RX chips for gaming and Epic systems for the data center.Interestingly enough, it is not even traditional chip companies that have put pressure on NVDA. Companies like GOOGL, MSFT and Amazon (NASDAQ:AMZN) have been developing their own.Finally, there are more startups emerging that are gunning for the AI chip market, such as Graphcore and Cerebras Systems. NVDA Stock ValuationNvidia stock is far from cheap. Consider that the trailing price-to-earnings ratio is about 41x.Now it's true that Nvidia stock should fetch a premium since the company is a dominant player in several strategic markets. But the multiple is still on the high-side when compared to the growth rate, which has been on the decline (at least on a year-over-year basis). * 10 Stocks to Sell in Market-Cursed September Wall Street is also a bit skeptical, with the average price target at $186. In other words, this implies only about 2% upside from current levels.Tom Taulli is the author of the book, Artificial Intelligence Basics: A Non-Technical Introduction. Follow him on Twitter at @ttaulli. As of this writing, he did not hold a position in any of the aforementioned securities. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 Stocks to Sell in Market-Cursed September * 7 of the Worst IPO Stocks in 2019 * 7 Best Stocks That Crushed It This Earnings Season The post The NVDA Stock Rally May Soon Come to an End appeared first on InvestorPlace.
Investing.com - U.S. futures were higher on Thursday after President Donald Trump said he will postpone increased tariffs on Chinese imports by two weeks.
The stock market is a "what have you done for me lately" business. I believe that's the situation that Nvidia Corporation (NASDAQ:NVDA) finds itself in. In an economy that is becoming increasingly immersed in artificial intelligence (AI), the question that investors might be wondering is "what's next?"Source: michelmond / Shutterstock.com Since 2016, NVDA has started to look like a high-flying growth stock and not a fairly predictable semiconductor company. But the market has a way of finding equilibrium and that may very well be the case for Nvidia stock. The Market Already Recognizes NVDA as a Leader in AIBack in May of 2017, many people including InvestorPlace contributor Larry Ramer were saying that Nvidia stock, which was up about 200% for the year at the time, was already pricing in the benefit of the AI revolution. Yet in 2018, NVDA stock exploded to over $286 per share in October of 2018.InvestorPlace - Stock Market News, Stock Advice & Trading TipsThe reason for this, in large part, was the need for Nvidia's chips to power the mining of cryptocurrency. But cryptocurrency is a volatile business. And when the crypto bubble burst, the air went out of Nvidia stock as well. Shares plummeted over 50% by January of this year. * 10 Stocks to Sell in Market-Cursed September Now they're climbing again. Nvidia stock has gained over 30% since the end of May to its current price of $182.52 per share. Some of that gain is due to its most recent earnings report. In August, NVDA reported a better-than-expected earnings per share, and a slight gain in revenue. China Remains a Big Story for NvidiaAnother reason for the explosive growth in NVDA stock in 2018 was demand from China. It's no secret that the U.S. and China are racing to show leadership in the AI space. In July 2017, Nvidia and Baidu (NASDAQ:BIDU) announced a partnership that would allow Baidu to use Nvidia's technology for cloud computing service, self-driving vehicles, and AI home assistants.But since the onset of the trade war with China, analysts are wondering if NVDA will lose access to this all-important market. And if they do, will there be avenues to replace it? NVDA Is Moving Deeper into the IoT SpaceThis summer, Nvidia announced that it is the first AI platform to train BERT (one of the most advanced AI language models) in less than an hour and complete AI interference in just over 2 milliseconds. Companies recognize the significance of this breakthrough as they use real-time conversational AI to engage more naturally with customers. This means that hundreds of developers worldwide will use NVDA's AI platform to advance their own language understanding research and create new services.This initiative alone will seed the company more deeply into the growing Internet of Things (IoT) space. If estimates are correct, IoT revenue will top $373 billion in 2020 and hardware, like the kind Nvidia provides, will account for 52% of those sales.This came after Nvidia's announced partnership in April of 2018 in which ARM will use Nvidia's open-source Deep Learning Accelerator (NVDLA) in its Project Trillium platform. Last month I wrote that this may not sound like a big revenue generator for NVDA in the short-term. However, it helps Nvidia create an ecosystem that will drive more revenue through its data centers. The Bottom Line on Nvidia StockPrior to 2016, Nvidia was a semiconductor stock doing the things that semiconductor stocks do. It didn't move too high or too low. It was predictable. Then AI came along and NVDA has become feted like a tech darling as investors rushed to get in on the "next new thing".I'm not down on Nvidia stock. The company is a legitimate leader in the technology that is fueling AI applications. But if the equity was looking overvalued at $140, it certainly seems to be overvalued at $180. That's especially so since the consensus price estimate is $189.Buy Nvidia for what it is - a semiconductor company. But don't pay a price for Nvidia stock based on its current valuation with the expectation that it has a high ceiling: at least not right away. The AI revolution is not going away, but not every application or every company will be successful. Nvidia is just one link in the chain. And their success is dependent on others being able to deliver on their promises.As of this writing, Chris Markoch did not hold a position in any of the aforementioned securities. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 Stocks to Sell in Market-Cursed September * 7 of the Worst IPO Stocks in 2019 * 7 Best Stocks That Crushed It This Earnings Season The post With Obvious Catalysts Priced In, Whatas Next for Nvidia Stock? appeared first on InvestorPlace.
Chipmaker Nvidia is at the forefront of AI and machine learning, but earnings and share prices have dived. Here is what fundamental and technical analysis say about buying Nvidia stock now.
Self-driving cars are inevitable, and billions of dollars are going into this technology. We take a look at five of the best stocks in the industry right now.
As Micron (NASDAQ:MU) approaches its $50 yearly high, investors must ask themselves if MU stock will continue marching higher. Much of the rally is built on two premises: the U.S.-China trade war is on pause and stronger chip demand is expected for the rest of the year. To argue the bullish case, assume for a moment that these expectations prove accurate.Source: Charles Knowles / Shutterstock.com China's retaliatory tariffs on $75 billion worth of U.S. goods are but a distant memory. Micron stock fell to the low $40's on Aug. 23. But when the U.S. announced no immediate trade negotiations or progress and instead pointed to talks resuming in October, MU stock soared. It added another 8.5% in the last week, closing recently at $49.13. And since the market is pricing expectations for the future, investors may expect tariffs staying. Suppliers now know exactly what extra taxes they face, so knowing how much costs change will allow them to adjust output accordingly.MU stock was not the only winner in the last week. In that time, Intel (NASDAQ:INTC) rose 8.9% while Nvidia (NASDAQ:NVDA) rose 7.8%. Oddly enough, Advanced Micro Devices (NASDAQ:AMD) did not participate in the rally, falling 3% in the last week. Micron stock may benefit from being among the cheapest semiconductor stocks at a price-to-earnings ratio of 5.8X. As business returns to normal levels, investors may find MU stock is still trading at a discount.InvestorPlace - Stock Market News, Stock Advice & Trading Tips Micron's OutlookMicron is confident that the long-term outlook for memory and storage is compelling. Secular trends, such as AI, autonomous driving (ADAS), IoT and 5G, will not just go away because of the troubling trade wars. In the last quarter, Micron benefited from customer inventory improvements. Given that positive development, Micron forecast demand for DRAM (memory chips) returning to healthy year-over-year growth in the second half of this year. * 10 Healthcare Stocks to Buy Despite the Headlines Micron also forecast NAND (used in solid state storage) bit demand increasing in most of its markets. Although chip suppliers suffered from weak pricing power for NAND in the last year, that trend stimulated demand. The rebound in NAND demand justifies the recent rally in MU stock. But to drive profit margins higher, Micron cut capital expenditures to align industry supply with current demand levels. MU: Pushing InnovationMicron now attributes high-value solutions to two-thirds of NAND revenue. It launched data centers that use high-speed NVMe SSDs for cloud and enterprise markets. And in the third quarter, it more than doubled shipments of its NVMe client SSDs to large PC OEMs.In the mobile market, the company offers mobile DRAM products that are extremely energy efficient compared to the competition. In Q3, DRAM shipments for the enterprise were at levels higher than management expected. It forecast continued demand momentum for the current Q4 period. Headwinds Bearing Down on MU StockRestrictions against Huawei hurt NAND revenue and shipment levels. If the U.S. did not impose such restrictions, DRAM and NAND revenue would have met the company's high end of guidance. In the remote chance that the U.S. and China agree on a trade deal, the U.S. may lift the tough restrictions Huawei now faces.Micron increased its NAND inventory levels for calendar 2019 and 2020 in anticipation of higher demand. It also held above-average DRAM inventory for the same reason. If the expected demand does not arrive, Micron may have to sell excess inventory at reduced prices. Valuation and Your TakeawayMicron knows better than investors and analysts what demand levels will be like for the rest of the year. Although it did not issue a FY 2020 forecast, its expectations for stronger demand will lift its profit margins. Investors may assume that in a 10-year DCF Revenue exit model, a revenue exit model of 1.5 times to 2.5 times.Micron reports results after the market closes on Sept. 26. If it confirms that strong demand is ahead, then the stock has more upside.As of this writing, Chris Lau did not hold a position in any of the aforementioned securities. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 Stocks to Sell in Market-Cursed September * 7 of the Worst IPO Stocks in 2019 * 7 Best Stocks That Crushed It This Earnings Season The post Why Micron Stock Still Has Plenty of Room to Run in 2019 appeared first on InvestorPlace.
Shares of Nvidia (NASDAQ:NVDA) have been ripping higher lately. NVDA stock is up nearly 10% over the past four trading days alone, outpacing even the torrid gains for the semiconductor stocks in that same time frame. While certainly some of the rally was warranted given a decent earnings beat, Nvidia stock has now come too far, too fast. Look for a pullback in NVDA over the coming weeks.Source: michelmond / Shutterstock.com Nvidia reported earnings on Aug. 15 with earnings per share of $1.24 beating estimates for $1.15. Revenues, however, were less impressive, coming in roughly in line at $2.58 billion. The revenue numbers actually represented a 17.3% year-over-year decline. Yet NVDA stock still moved up big following the report, adding on over 20%. An 8% earnings beat with flat revenue means that most of the move was obviously due to a big multiple expansion.InvestorPlace contributor Chris Lau noted yesterday that the average analyst price target was $189.96 -- implying less than 5% upside from current levels. That doesn't look too rewarding to me.InvestorPlace - Stock Market News, Stock Advice & Trading TipsNvidia stock is certainly getting more expensive from a fundamental view. The trailing price-to-earnings ratio now sits above 40 and at a premium to the five-year average of 34. It has risen sharply even factoring in that most recent earnings beat. Price-to-sales is just over 10, far exceeding the five-year average of just 7.5 and nearing the highest levels ever. Other valuation metrics, such as price-to-book and dividend yield, are similarly rich. NVDA is most assuredly not a cheap stock at current levels. Nvidia Stock ChartsNVDA stock is getting overbought on a technical basis. The five-day relative strength index just breached the 75 level which has marked short-term tops in the past. The moving average convergence/divergence is also fast approaching readings that signaled the rally may be getting overdone. Bollinger Percent B broke above 1 before weakening, yet another sign of too much exuberance. Nvidia stock is trading at a large premium to the 20-day moving average. This has usually been a prelude to a pullback. * 10 Stocks to Sell in Market-Cursed September More importantly, NVDA failed to break past major resistance at $184 yesterday. Nvidia stock traded up to a high of $183.98 only to subsequently reverse course and close well off the highs. This type of intra-day reversal pattern is often indicative of a significant top. The buyers have finally become exhausted and the sellers are in control. It is especially powerful near major resistance and following a strong rally like just evidenced in NVDA stock. The Bottom Line on NVDA StockI previously had a bullish outlook on NVDA with shares trading at the $155 area. Now that Nvidia has rallied sharply, my viewpoint has changed as well -- because price does matter. The current P/E ratio expanded by 33% since late May, moving from 30 to 40. The oversold technicals back then have now flipped to overbought. It's time to take a more bearish stance on NVDA stock.Investors should use any further strength in the Nvidia stock price to take a short position. The initial downside price target would be the 20-day moving average at the $165 area. A significant break above resistance at $184 would be a logical stop out level.Implied volatility is only at the 16th percentile, meaning option prices are comparatively cheap. This favors option buying strategies when constructing trades. Option traders may elect to take a guardedly bearish position by purchasing a bear put spread.Buying the NVDA Oct $180 puts and selling the NVDA Oct $175 puts could be done for a $2.00 net debit. Maximum risk is $200 per spread with a maximum gain of $300 per spread if NVDA stock closes below $175 at expiration on Oct. 18. Potential return on risk equates to 150%.Tim may hold some of the aforementioned securities in one or more of his newsletters. Anyone interested in finding out more about Tim and his option-based strategies can go to https://marketfy.com/item/options-and-volatility. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 Stocks to Sell in Market-Cursed September * 7 of the Worst IPO Stocks in 2019 * 7 Best Stocks That Crushed It This Earnings Season The post Time to Cash in Your Chips on Nvidia Stock appeared first on InvestorPlace.
It would have been easy not to notice, given all the noisy rhetoric surrounding Advanced Micro Devices (NASDAQ:AMD). Nevertheless, it's happened. AMD stock is being squeezed into a narrowing trading range framed by clear support and resistance. One side of that range will have to snap sooner than later.Source: Shutterstock In more direct terms, Advanced Micro Devices stock has moved into a scenario that's going to force traders to make a big commitment to their stance.The good news is, those boundaries are well defined. The bad news (for the bulls) is that there's just as much new pressure being put on the floor as there is on the ceiling. One more bad day could too easily send AMD stock into a steep selloff.InvestorPlace - Stock Market News, Stock Advice & Trading Tips No Longer in Turnaround ModeWe must give credit where it's due. Advanced Micro Devices caught Intel (NASDAQ:INTC) as well as Nvidia (NASDAQ:NVDA) off guard. More importantly, they've made the most of it. * 7 Stocks to Buy In a Flat Market It's a well-known but underappreciated story. Largely left for dead by its rivals by that time, AMD named Lisa Su as CEO in late 2014. This turned out to be a stroke of brilliance. Aside from her technical and engineering know-how, she's proven a capable leader and something of a turnaround artist.Investors have been well rewarded for their patience and/or willingness too. Look at the AMD stock price rally: from 2016's low of less than $2 per share to the current price near $30 translates into a 1500% profit.As that march matured though, its underpinnings changed. At its onset, the "bet" was on the company's turnaround trajectory. Now, more than three years in and the turnaround largely complete, the stock reflects its maximum plausible value.In other words, the turnaround is over.A handful of traders aren't ready to concede that point yet. Many of that cohort, in fact, will argue -- loudly -- that the next three years will look much like the past three years have for AMD stock. And anything's possible to be sure.Even without doing it intentionally though, the majority of traders have already quietly signaled their uncertainties. The AMD Stock Chart Says It AllAs was noted, it would be easy to overlook. There it is, though. Advanced Micro Devices stock has been unable to push its way back above the purple 50-day moving average line after last month's weakness. But at least the gray 100-day moving average line appears to be acting as a floor. Either are long-term firsts but seeing them together is something we've not yet witnessed.Critically, the combination of simultaneous support and resistance signals neither bulls nor bears have made a commitment to their opinion. The scenario also signals, however, both groups are going to be forced into making that commitment soon.And for the record, the bears have a slight edge here. AMD stock has already fallen under the rising support line, plotted as a dashed blue line, that carried shares up from their late-2018 low. The stock also bumped into resistance -- repeatedly -- just above $34 in the middle of the year before tiring of failure. That ceiling, marked in yellow, may come into play again at a later date.Still, until and unless the AMD stock price breaks back under the 100-day moving average line at $30.19, none of the bearish undertow matters.If that floor does snap though, the 200-day moving average line at $26.33 becomes the next best target. Looking Ahead for Advanced Micro Devices StockWhile AMD stock mostly did its own thing between 2016 and now, it's increasingly tethered to the broad market's tide. That is to say, it's more likely to move with the overall market than defy its undertow.That adds to the bearish case working against Advanced Micro Devices stock at this time.Not only is September and early October the most reliably bearish time of year for the market, the third year of a presidential term is typically lethargic through the middle of November, until after midterm elections. This year's strength so far sets the stage for another modestly meaningfully lull over the next several weeks.Whatever's in the cards this time around, there's certainly not a great bullish case for Advanced Micro Devices stock. At best, it's a coin toss, and that toss is coming soon.As of this writing, James Brumley did not hold a position in any of the aforementioned securities. You can learn more about him at his website jamesbrumley.com, or follow him on Twitter, at @jbrumley. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 3 Artificial Intelligence Stocks to Buy * 7 Industrial Stocks to Buy for a Strong U.S. Economy * 3 Beaten-Down Bank Stocks to Buy and Hold for the Long Term The post AMD Stock Quietly Stumbles into a Bull versus Bear Showdown appeared first on InvestorPlace.