168.90 +1.82 (1.09%)
Pre-Market: 6:00AM EDT
|Bid||166.57 x 1000|
|Ask||169.00 x 1100|
|Day's Range||164.84 - 168.17|
|52 Week Range||124.46 - 292.76|
|Beta (3Y Monthly)||2.52|
|PE Ratio (TTM)||31.54|
|Earnings Date||Aug 15, 2019|
|Forward Dividend & Yield||0.64 (0.38%)|
|1y Target Est||181.83|
There have been three trade war truces since the US-China trade war erupted last year. Will the current trade talks be successful?
Advanced Micro Devices (NASDAQ:AMD) is back at the highs. The AMD stock price cleared $33 last week, something it's managed to do a few times in the past year. Each time, those levels have proven to be bad news for Advanced Micro Devices stock.Source: Shutterstock AMD stock got there for the first time last September, reaching a 12-year high at the time. It immediately dipped. After two more tries, the chip sector as a whole collapsed. The AMD stock price went from $33 to $17 in a matter of weeks.AMD stock briefly touched $34 last month. It fell promptly declined 15% over the next five sessions.InvestorPlace - Stock Market News, Stock Advice & Trading TipsIt's pretty clear that levels around $33-$34 have proven to be resistance for the AMD stock price. The question now, particularly with Q2 earnings on the way in two weeks or so, is whether this time will be different. * 7 Dependable Dividend Stocks to Buy The Risks to the AMD Stock PriceThere are three reasons to see current levels as potentially risky for Advanced Micro Devices stock. The first is precisely that history, particularly in the context of chip stocks more broadly. Big earnings from Micron (NASDAQ:MU) have helped boost the sector in recent weeks, admittedly.But semiconductor stocks have seen quite a bit of volatility over the past year. Micron may have touted optimism - but Broadcom (NASDAQ:AVGO) did largely the opposite. Even before those reports, this has been a space where investors are best off zigging while the market zags, buying when sentiment turns sour and selling when optimism returns. That's held for AMD as well, obviously, given the stock has doubled from December lows.As such, resistance here may be firm. And that risk is buttressed by fundamental concerns. As I wrote last month, at those June highs, AMD stock isn't cheap. It trades at over 32x next year's consensus EPS. The average Wall Street price target still sits below the current price.Analysts don't always have it right, obviously (that's been particularly true in the chip space over the past eighteen months), but 32x is a big multiple for chip stock. Investors in Nvidia (NASDAQ:NVDA) learned what happens when an investor overpays for growth in such a cyclical industry. If only on a short-term basis, investors in Advanced Micro Devices have learned the same lesson a few times.And the third risk for AMD is the earnings report on the way, likely at or around the end of this month. Expectations clearly are high. AMD has stumbled after earnings in the past - most notably with a 22% decline after the Q3 report in October. AMD needs a big quarter to keep a repeat from occurring this time around. The Case for Advanced Micro Devices StockThe simple answer to all those worries is: so what? AMD stock has climbed the "wall of worry" for years now. After all, this was a $2 stock as recently as 2016, with real fears that the company might eventually declare bankruptcy.That's obviously no longer the case. AMD's new chips have made it a formidable competitor to Nvidia and Intel (NASDAQ:INTC). Intel's repeated mistakes only increase the possibility of more market share gains, more growth, and a higher AMD stock price. And those self-inflicted wounds at AMD's key competitor, along with reports of strong PC sales, suggest Q2 numbers will be impressive.Broadly speaking, this simply is a much better business than it was, and it's a really good business on its own. The "old" Advanced Micro Devices was a second-tier provider of chips for low-priced PCs. But it's now a more diversified player in terms of both PCs and growing end markets like data centers. AMD stock might not be cheap, but it shouldn't be cheap. The Bottom Line on Advanced Micro Devices StockBoth sides can make a strong case at the moment, which makes Q2 earnings particularly important. Technically and fundamentally, AMD stock is likely to move further in whatever direction it trades after the report.Big numbers lead to higher earnings estimates and likely a series of analyst upgrades that can further goose the stock. That, in turn, pushes AMD through resistance, which usually (though not always) triggers higher prices.Anything less, however, and history suggests Advanced Micro Devices stock could have a problem. We've seen AMD move from $33+ to under $30 in a blink. Bad news, or even an outlook that doesn't quite match currently optimistic expectations, could do the same, or worse.All told, I'd expect that a month or two out, AMD stock isn't trading at $33. But which way it moves will depend largely on what kind of story Advanced Micro Devices can tell with its second-quarter report.As of this writing, Vince Martin has no positions in any securities mentioned. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 7 Dependable Dividend Stocks to Buy * 10 Stocks Driving the Market to All-Time Highs (And Why) * 7 Short Squeeze Stocks With Big Upside Potential The post Advanced Micro Devices Stock Could Be Set to Finally Bust Through appeared first on InvestorPlace.
There have been some stunning developments in the stock market recently. Last Wednesday, the S&P 500 broke above 3,000 -- 3,002.98, to be exact -- an historic new high. And then Thursday, the Dow cracked 27,000, a record-breaking all-time high, too.Source: FlickrThat's fantastic!Remember, just a few months ago the financial talking heads were giving all kinds of reasons to scare investors out of the market. The U.S.-China trade war … the (briefly) inverted yield curve … an earnings recession … All of which triggered an increase in market volatility and had investors running to the sidelines. But now, that fear of jumping in has been replaced with the fear of missing out, or as the younger folks like to say, "FOMO."InvestorPlace - Stock Market News, Stock Advice & Trading TipsNow, if you've been following me here or are subscribed to Growth Investor, then you know I've strongly encouraged folks to ignore the financial media and stay invested, even on the big market down days.Here are just a few examples …Back in early January, we saw some major market gyrations. Folks were nervous, but I knew that the foundation of the stock market remained quite healthy. You see, I saw that after the big selling a lot of buying pressure, or the "smart money," was emerging. Simply put, the smart money came to rescue the market. I encouraged my subscribers to buy the dip. As expected, the stock market proved to be very resilient. Both the S&P 500 and Dow ended the month up over 7%.We saw some more market oscillations in May when the U.S.-China trade wars and European Union (EU) elections triggered panic sell-offs. Again, I viewed the weakness as an incredible buying opportunity. I encouraged my subscribers to hold on and stay invested. By June, the market had rebounded strongly.In between the choppy market action, subscribers across all my services were still able to lock in stunning triple-digit gains in companies like NVIDIA (NASDAQ:NVDA) for a 274% return in January, a 115% profit in Worldpay (NYSE:WP) in March, a 150% gain in World Wrestling Entertainment, Inc. (NYSE:WWE) in May, a 122% return in Netflix, Inc. (NASDAQ:NFLX) in June and a hefty 211% return in IntriCon, Inc.(NASDAQ:IIN) in June, too.We did this by putting our emotions to the side and investing in companies with strong fundamentals, earnings and sales growth, rather than waiting for the market to turn around. The truth of the matter is it's nearly impossible to time the market bottom or top. So, you invest in the creme de la creme of stocks, as these companies will come out on top in the end. And that's exactly what we did.And now, here we are, with two major indexes sitting at record highs. When you tally up the numbers, this means that the S&P is up over 20% and the Dow is up over 15% since the opening bell rang in the New Year.The Rally Isn't Over YetHowever, I think this market rally is just getting started.There are two big positives that should continue to drive the broader market higher. July, overall, is historically a seasonally strong month -- and this year should be no different. Second-quarter results will start to be released around mid-month. And since the best quarterly results tend to be reported early in the season, we should see a nice boost to the stock market overall towards the end of July. So, the second half of July should benefit from wave-after-wave of positive earnings.A key interest rate cut by the Federal Reserve would also be a very good thing for the market. In last month's Federal Open Market Committee (FOMC) statement, the Fed removed the word "patient" and cited that slowing global growth is influencing the FOMC's interest rate decisions. I said last week that the Fed never fights market rates. So, as the Treasury yields collapse, the Fed has no choice but to slash key interest rates. This is an ideal environment for stock appreciation.Consider this: Due to falling Treasury yields, the average median forecasted price-to-earnings (P/E) ratio for the S&P 500 could expand from 15.5 to 20, or higher. So, when you couple falling interest rates with the fact that major central banks like the European Central Bank (ECB) and Federal Reserve will be cutting key interest rates, then it is very possible that the S&P could appreciate another 30% on the recent global interest rate collapse.Bottom line: There's a lot of potential upside in the current market environment. So if you haven't invested yet, then I strongly encourage you begin investing now so you don't miss out on the big gains ahead.If you're not sure where to get started, I recommend checking out Growth Investor. I recently recommended a new stock and released my fresh list of Top 5 Stocks, all of which are great places to park new money. You can sign up here.I also have three special reports for you, which are yours -- free of charge if you sign up now. They go in-depth on three of the hottest sectors set to explode: artificial intelligence (AI), cybersecurity and the 5G revolution. And I give you my number-one pick for each space, too. I don't want you to miss out on these profitable trends, so click here to get your free reports today.Louis Navellier is a renowned growth investor. He is the editor of four investing newsletters: Growth Investor, Breakthrough Stocks, Accelerated Profits and Platinum Growth. His most popular service, Growth Investor, has a track record of beating the market 3:1 over the last 14 years. He uses a combination of quantitative and fundamental analysis to identify market-beating stocks. Mr. Navellier has made his proven formula accessible to investors via his free, online stock rating tool, PortfolioGrader.com. Louis Navellier may hold some of the aforementioned securities in one or more of his newsletters. More From InvestorPlace * 4 Top American Penny Pot Stocks (Buy Before June 21) * 7 Stocks to Buy that Lost 10% Last Week * Top 7 Dow Jones Stocks of 2019 -- So Far * 5 Service Stocks That Can Win the Trade War -- According to Goldman Sachs The post Don't Miss Out on the Next Big Stock Market Rally appeared first on InvestorPlace.
Wall Street loves turnaround stories. Over the years, investors in Advanced Micro Devices (NASDAQ:AMD) stock have been delighted with the price performance of their shares. I'm going to discuss the short- and long-term outlook of AMD stock, one of the darlings of Wall Street in 2019.Source: Shutterstock AMD stock is expected to report Q2 earnings on July 24. Year-to-date, the Santa Clara-based chip designer is up about 93%. Long-term, I believe AMD stock price is going to rise much more. However, in the short-term, as AMD stock and its peers get ready to release quarterly results, there could be increased volatility in the markets. * 7 Dependable Dividend Stocks to Buy I would encourage long-term investors to wait several weeks before buying AMD stock or hedge their positions if they currently own the stock.InvestorPlace - Stock Market News, Stock Advice & Trading Tips What to Expect From AMD Stock EarningsWhen AMD releases earnings in late July, Wall Street will pay attention to two segments: * Computing and Graphics and * Enterprise, Embedded and Semi-CustomOn April 30, Advanced Micro Devices reported its Q1 2019 earnings. Its profit of 6 cents per share came in slightly ahead of analysts' consensus outlook. In its Computing and Graphics segment, AMD's revenue tumbled 26% year-over-year (YoY) to $831 million. In the Enterprise, Embedded and Semi-Custom segment, its revenue fell 17% YoY to $441 million.Overall many analysts saw the Q1 earnings report as a sign that AMD is executing its strategic plans well. In the current quarter, AMD management expects its revenue to be about $1.52 billion, a decrease of approximately 13% YoY.Since late 2014, under the leadership of CEO Lisa Su, revenue has gone up and the company has been improving its balance sheet. Its debt has reduced and investors are hopeful that AMD stock can see positive cash flow soon. Over the next five years, analysts expect AMD to grow earnings by about 30% annually.As new frontiers in technology, such as the internet of things (IoT), artificial intelligence (AI), autonomous driving, and 5G are being developed, I am bullish on the future of Advanced Micro Devices, which has been quite successful in recent years. As a result, I am also upbeat on the long-term outlook of AMD stock.Yet, recent positive news from Advanced Micro Devices stock's earnings and its clients have been factored into AMD stock price. Until AMD's next earnings announcement, its stock is likely to become a battleground between long-term investors and short-term traders.AMD has a history of reporting mixed results. Therefore Wall Street is likely to be cautious going into earnings. AMD Stock Is Catching up With Its Main CompetitorsUntil 2019, Advanced Micro devices has mostly played catch-up with Nvidia (NASDAQ:NVDA) and Intel (NASDAQ:INTC). The market cap for NVDA and INTC stocks are $101 billion and $223 billion respectively. AMD stock's market cap stands at $37 billion.Nvidia has dominance in graphics processing units (GPUs) while Intel has been a leader in central processing units (CPUs), the computing engine of most computers and data centers. Graphics processing units accelerate central processing units, boosting the performance of video and graphics and improving computers' overall performance.In May, the U.S. Department of Energy announced that AMD and Cray (NASDAQ:CRAY) had been awarded a $600 million contract to develop the 'Frontier' supercomputer. Expected to become the world's fastest computer, Frontier will perform advanced calculations in areas like nuclear and climate research.The supercomputer will use AMD's EPYC CPUs, each of which will be connected to four of the company's Radeon Instinct GPUs. This important deal confirms that AMD is now a recognized industry leader. In other words, AMD has a roadmap to compete with Intel's dominant CPUs and Nvidia in the graphics-card space.In Q3 AMD is expected to start selling its 7-nanometer (nm) chips, rivaling Intel's 10nm, which will not be sold until the end of the year. With these smaller and more power-efficient chips, AMD is aiming to take market share from Intel, especially in data center business.As AMD launches its Navi graphics cards in Q3 featuring the company's 7-nanometer chips, management is confident that it will take GPU market share in the gaming segment from Nvidia.In short, Advanced Micro Devices has taken important steps to make the fundamental metrics of the company stronger and to catch up with its main competitors. What Could Derail AMD Stock Short-Term?Wall Street has recently been debating whether the semiconductor industry, which is highly competitive and cyclical, has entered a prolonged downturn. Could these chip stocks have reached their 2019 highs in the eyes of investors?For long-term investors, such gyrations in the sector are nothing new. Yet, in the coming weeks when many chip companies announce their earnings one after the other, any potential weak guidance that may be issued could lead investors to become bearish on semiconductor stocks.Wall Street is nervous that chip companies' upcoming results will be mixed. Analysts follow AMD's gross margin levels closely. The company expects its Q2 gross margin to be 41%, the highest in eight years. Therefore, any unexpected dip in the margin could easily push AMD stock price south.China is the leading consumer of semiconductors (more than 50%). On the other hand, U.S. chip companies lead the world with a combined global market share of nearly 50%. Furthermore, many technology companies either have manufacturing plants in China or use Chinese companies in their supply chains. Therefore, Wall Street fears that U.S. chip makers will be among the largest losers of the current trade war.Furthermore, analysts are debating whether Advanced Micro Devices stock is becoming overvalued. For example, its forward price-to-earnings-growth (PEG) ratio is about 2x. Similarly, AMD stocks's price-sales (P/S) ratio of about 6x is also quite high. To put the metric into perspective, the S&P 500's average price-sales ratio is 2.1. Should Investors Buy AMD Stock Prior to Earnings?As a result of the impressive run-up in AMD stock price in 2019, its short-term technical indicators have become quite "overbought." In June, in addition to the broader market rally, AMD stock got an analyst upgrade that gave a big boost to its price.If you are an investor who follows technical charts, AMD stock has strong resistance around the $34 level, where the stock is about to make a triple top. Therefore, if it cannot go and stay over $35 soon, some profit-taking is likely to occur.Because AMD is a momentum leader stock, investors should expect sizable daily swings in the AMD stock price. Technically AMD stock is known to make a series of rallies and consolidations. We can expect this trend to continue in July and August, too.If you already own Advanced Micro Devices stock, you might want to stay the course and hold onto your position. That said, if you are worried about short-term profit taking, then within the parameters of your portfolio allocation and risk/return profile, you may consider placing a stop loss at about 3%-5% below the current price point, to protect the profits you have already made from AMD stock.If you are an experienced investor in the options market, you may also consider using an Aug. 16 expiry at-the-money (ATM) covered call strategy. In that case, you may, for example, buy 100 shares of AMD at a limit price of $33 and sell an AMD Aug. 16 $33 call option, which currently trades at $2.4.The $33 option offers some downside protection in case of volatility and a decline of AMD stock price. It would also enable investors to participate in a potential up move. This call option would stop trading on Aug. 16 and expire on Aug. 17.I find AMD stock to be a buy candidate, especially as its price declines below $30. In a few years, I'd expect the shares to reach $40.As of this writing, the author holds INTC covered calls (July 19 expiry). More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 7 Dependable Dividend Stocks to Buy * 10 Stocks Driving the Market to All-Time Highs (And Why) * 7 Short Squeeze Stocks With Big Upside Potential The post Can AMD Stock Jump Higher on Q2 Earnings? appeared first on InvestorPlace.
I decided to take a closer look at NVIDIA (NASDAQ:NVDA) because of its impressive EBITDA numbers. Typically, I don't put too much importance on EBITDA, but I found that NVDA stock has a lot going for it beyond just this stat. In 2018, NVDA reported an impressive EBITDA of $4.11 billion. Meanwhile, the EBITDA margin was a healthy 35%.Source: Shutterstock You may be saying "That is just great, but what the heck are you talking about? What is EBITDA?"You've probably heard the term EBITDA. It is a metric that is used by some investors to evaluate companies. It is commonly used by Private Equity firms when they look for target companies to buy. The term is an acronym for Earnings Before Interest, Taxes, Depreciation and Amortization.InvestorPlace - Stock Market News, Stock Advice & Trading Tips Understanding EBITDATo understand EBITDA we need to understand what net income is. Net Income is simply the amount of sales a company makes minus the costs it incurs. When you hear an analyst talk about earnings per share, it is the net income divided by the number of shares. For example, if a company has a net income of $1 million and has one million shares outstanding it will report an earnings per share of $1.The costs of a company include the cost of the goods that were sold and the selling, general, administrative, and operational costs associated with the sales. They also include the non-operational costs such as interest payments on the bonds the company has issued, the taxes it must pay, and the relevant depreciation and amortization costs. EBITDA can be thought of as net income without deducting the non-operating costs. This may sound complicated but it comes from a simple concept.EBITDA became a popular measure in the 1980s when corporate raiding and hostile takeovers were common. This happens when the buyer -- or raider -- attempts to takeover a company without the approval of the management of said company by acquiring enough shares to gain control. It was typically done with borrowed money. EBITDA was a measure that was used to see if the cash flow that the target company generated would cover the interest costs of the money that was borrowed to buy it.A good analogy for why these raiders cared about EBITDA is rental property. Suppose you buy a building and the rental income you make covers the cost of your expenses. Then, in theory, the investment will eventually pay for itself. This was the principle behind the hostile takeovers.EBITDA should not be used in isolation, however, because this number can be very misleading. Non-operating costs are still costs and eventually they need to be paid. A company that is effectively bankrupt because it owes millions in taxes could have great EBITDA. As a matter of fact, like many other companies, NVDA doesn't even report EBITDA in their financial statements. How EBITDA Shows NVDA Stock Is a Good BuyAfter initially being attracted to NVDA stock by it's EBITDA, I found three more things to indicate future long-term profitability.First, the operating margins have expanded. Operating margins aren't the exact same thing as EBITDA, but they are linked. Operating margins are the amount of money a company makes for each dollar of sales expressed as a percentage. Over the past three years the margin has expanded from 22% to 37%. In other-words, the company was making 22 cents per dollar and now they are making 37 cents per dollar. This is very impressive growth.The second thing that may be bullish for NVDA is the increasing amount of free cash flow that it has been generating. Cash flow is basicall earnings after Interest, Taxes, Depreciation and Amortization.This is the amount of cash that a company has after paying its bills. Like I mentioned earlier, looking at cash flow often exposes the issue with the EBITDA stat, but for NVDA stock, that's not the case. In 2016, NVDA's cash flow was $1.1 billion. By 2018, this number had increased to $2.9 billion. This is also an impressive growth rate, and it shows that EBITDA can be indicative of a strong, growing company. * 7 Dependable Dividend Stocks to Buy The third aspect of NVDA that I find impressive is the growth in earnings per share. In 2018 they were $1.08, in 2017 they were $2.57, and 2018 they increased to $4.82. These three metrics suggest that NVDA may be a great long-term investmentAt the time of this writing Mark Putrino did not hold any positions in the aforementioned securities. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 7 Dependable Dividend Stocks to Buy * 10 Stocks Driving the Market to All-Time Highs (And Why) * 7 Short Squeeze Stocks With Big Upside Potential The post How EBITDA Exposes Three Reasons to Like NVDA Stock appeared first on InvestorPlace.
This weekend's Barron's presents the 2019 Midyear Roundtable commentary and stock picks. Specific roundtable picks include a leading dollar store operator and the inventor of graphics processing units. ...
The AMD vs. NVIDIA midrange GPU battle is heating up, Microsoft went back to the '80s and Nintendo introduced a Switch Lite. Oh, and some Amazon workers will strike on Prime Day. In a paper published in the journal of Scientific Advances, scientists from the University of Glasglow shared the first known image of a Bell entanglement.
Todd Ahlsten, a Barron’s Roundtable panelist and lead portfolio manager of the Parnassus Core Equity fund at Parnassus Investments, sees a rally coming for beaten-up chip stock Nvidia
Piper Jaffray analyst Harsh Kumar predicts demand will improve as more games support the “ray tracing” technology of Nvidia’s graphics cards.
For once, AMD made NVIDIA sweat. NVIDIA's new RTX Super graphics cards are clearly a response to AMD's new midrange GPUs, the Radeon RX 5700 and 5700 XT . For months, AMD has been hyping how much faster they are than the first RTX cards. The only solution for NVIDIA was a surprise batch of faster cards, which, in turn, led to AMD announcing a price drop at the last minute. Witness the capitalist ideal of competition in action.
Today, China released its trade data for June. China’s dollar-denominated exports fell 1.3%, while its imports in US dollar terms fell 7.3% last month.
Not long ago, NVIDIA (NASDAQ:NVDA) seemed to be invincible. By leveraging its GPU (Graphics Processing Unit) franchise, the company penetrated lucrative markets in categories like data center and AI (Artificial Intelligence). The result is that Nvidia stock has been a big winner for investors. For the past three years, the average annual return was a sizzling 53.82%!Source: Shutterstock But lately things have gotten tougher. The fact is that the Nvidia stock price is feeling the pressure of competition. The irony is that it is not from well-funded startups that have disruptive technologies. Rather, one of the scariest rivals is Advanced Micro Devices (NASDAQ:AMD). The company's CEO, Lisa Su, has pulled off a near miraculous turnaround. And the key has been an obsession on innovation.In fact, AMD is starting to take the lead on NVDA, which is certainly amazing. Keep in mind that NVDA has huge global scale and enormous resources, with a market cap of $95 billion. By comparison, ADM's market cap is about $36 billion.InvestorPlace - Stock Market News, Stock Advice & Trading TipsA stark illustration of the fight among these two semiconductor companies: AMD's Navi-based RX 5700 and RX 5700 XT chips. These are focused on the large PC gaming market and, for the most part, it looks like AMD has the performance lead (this is based on analysis from Tom's Hardware). There have also been notable improvements in power efficiency. * 7 Stocks to Buy for Monster Growth in the Second Half of 2019 Oh, and something else: Advanced Micro Devices has made things even more difficult for NVDA stock by reducing the pricing on the chips. That is, there is negligible difference. In other words, why wouldn't customers opt for the AMD chips?I don't see why not.Now this is not a one-off. Keep in mind that the Ryzen 3000 chips have also shown to be worthy alternatives to NVDA's offerings.Granted, all this does not spell the doom of the company. Again, NVDA is diversified and still has a powerful R&D infrastructure. The competition should actually provide a spur to boost the innovation, which should help with the long-term.Despite this, there are still other nagging issues with NVDA stock besides the competition with AMD: * Even though the company remains dominant with AI chips, this segment is likely to see more and more headwinds. Note that tech giants like Alphabet (NASDAQ:GOOGL, NASDAQ:GOOG), Microsoft (NASDAQ:MSFT) and Amazon (NASDAQ:AMZN) are building their own chips. * While the G20 summit had good news on the trade front -- with a truce between the US and China as well as a lessening of restrictions on Huawei -- there are still risks. President Trump can be mercurial. China also is experiencing slower growth, which could weigh on NVDA. * The latest quarterly report did beat expectations, but the results were still unnerving. Revenues plunged 31% to $2.22 billion on a year-over-year basis, as there was widespread weakness across gaming and the data center. Bottom Line On NVDA StockIt's true that NVDA is trading at a reasonable valuation, with a forward price-to-earnings multiple of 22. The company also should get a boost from its acquisition of Mellanox Technologies (NASDAQ:MLNX), which is a leader in technologies for high-speed networks. And, yes, when it comes to the AI market, the opportunity is enormous for NVDA stock. Keep in mind that GPUs are ideal for this type of technology, allowing for super-fast performance at low cost. * 10 Stocks to Sell for an Economic Slowdown But in the near-term, there is likely to be turbulence, especially as AMD gains ground and the company takes steps to stabilize the revenue base.So, for now, it's probably best to hold off on the stock.Tom Taulli is the author of the upcoming 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 for an Economic Slowdown * 7 Marijuana Penny Stocks That I May Buy * 7 of The Best Schwab ETFs for Low Fees The post Nvidia (NVDA) Stock Has An AMD Problem appeared first on InvestorPlace.
Apple (AAPL) stock still rests 13% below its 52-week high despite its roughly 30% climb in 2019 amid trade war worries and a slowdown in iPhone sales. Now, let's peek ahead to see what investors should expect from Apple's third-quarter fiscal 2019 financial results.
Nvidia (NASDAQ:NVDA) stock is showing small signs of progress. NVDA stock has been a falling knife over the past six months. But now, the stock, while not recovering tremendously, has at least stopped going down for the time being. Is Nvidia stock's seemingly endless plunge finally over?Source: Shutterstock The answer likely comes down to the following question: Will NVDA stock catch up to the stock market, or continue to trade on its own merit? The stock market is obviously booming, with the major averages making new all-time highs. Tech stocks in particular have been on fire. Meanwhile, Nvidia stock has been going up a little with the market, but then slipping back quickly. For example, last week, NVDA hit $166, but then slipped back to $160, even as the market continued to surge. * 10 Stocks to Sell for an Economic Slowdown That's because NVDA faces a ton of company-specific and sector-specific problems. These range from excessive inventory to the product issues facing Intel (NASDAQ:INTC), and the trade war.InvestorPlace - Stock Market News, Stock Advice & Trading Tips The Semiconductor Industry Is Caught in the CrossfireThe trade war is dragging on and on. That's awful news for leading semiconductor companies such as NVDA. According to Nvidia's most recent annual report, fully 74% of the company's revenues came from Asia during its last full fiscal year. The company generated $3.4 billion of revenue from Taiwan alone last year. It got $2.8 billion from mainland China and Hong Kong, and another $2.4 billion from the rest of Asia.NVDA got just $1.5 billion of revenue from the U.S., equaling barely 10% of its overall revenues. Amazingly, the small island of Taiwan buys more than twice as much from Nvidia as all of the United States does. Needless to say, the longer the trade war goes on, the more NVDA stock and its peers will suffer negative consequences.There's been some upbeat chatter about a potential resolution to the U.S.-China trade issues. Reportedly Trump and the Chinese delegation did a lot of talking ahead of the recent G-20 meeting. And there was an agreement of sorts related to Huawei, but it appears to be more of a temporary ceasefire than a solution. Until we get something concrete, Nvidia and the rest of the semiconductor industry will likely struggle. Rivals Feeling the HeatGlobal electronics giant Samsung exemplified the trade war issues with its earnings pre-release last Thursday. Samsung makes both semiconductor chips, competing with the likes of Micron (NASDAQ:MU) in memory. while also making plenty of end products such as phones and TVs.In any case, Samsung announced that it sees its operating profits for this quarter falling by more than 50%. Samsung blamed the decline on a combination of the trade war, weak memory prices, and soft demand from other customers. Reportedly, for example, the demand for Apple's (NASDAQ:AAPL) iPhone was so sluggish that Apple will have to pay Samsung some sort of compensation for not meeting minimum order levels.When giants like Apple and Samsung are failing to meet investors' expectations, it's clear that there's a broad slowdown in consumer electronics. As great as Nvidia's technology is, NVDA can't prosper in a world in which the whole consumer electronics sector is in a slump. If Apple, Samsung etc. continue to struggle, NVDA stock isn't going anywhere, either. Why Nvidia Stock Price Can ReboundNvidia hasn't given a whole lot of details about its outlook for the rest of the year. Starting with its last quarterly earnings report, NVDA stopped providing full-year guidance. That's often a sign of trouble ahead. That said, if you're looking for a bullish case on Nvidia stock, you can patch one together.For one thing, its inventory levels have declined in some areas, particularly in graphics. It appears the overbuilding of graphics cards has ended. And while bitcoin's surge won't set off another mining boom like it did in 2017, it will probably help increase demand to a certain extent. People still use GPUs to mine cryptocurrency after all.Overall, Nvidia's revenues will probably start to flatten out by the end of the year. If nothing else, at least the jarring double-digit-percentage revenue declines across all of its business segments will come to an end. If and when the trade war ends, Nvidia should finally be able to get back to revenue growth. As is often the case for tech companies, once NVDA's revenue bottoms, Nvidia stock price should start shooting back up again. The Verdict on NVDA StockIf Nvidia stock price was trading at fire-sale levels, there'd be a case for buying NVDA at this point. The company has fantastic technology and will surely bounce back sooner or later.But Nvidia stock is still aggressively valued after its seemingly huge decline. Nvidia is now selling at 31 times its trailing earnings. If you believe analysts' average estimates, its earnings will shoot up to $7 per share over the next year, pushing the P/E ratio to a more reasonable - though hardly cheap - 23\. With its revenues still declining, however, it's hard to see how this earnings explosion is going to occur.Ultimately the trade war will get sorted out, and Nvidia will get its momentum back. But there's no reason that such a development will necessarily happen in 2019. Nvidia stock price is far from cheap at this valuation. It may go up a little if the stock market keeps roaring higher. But until Nvisia's business gets its momentum back, the stock will continue to underperform the market as a whole.At the time of this writing, Ian Bezek owned INTC stock. You can reach him on Twitter at @irbezek. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 Stocks to Sell for an Economic Slowdown * 7 Marijuana Penny Stocks That I May Buy * 7 of The Best Schwab ETFs for Low Fees The post Nvidia Stock May Be Bottoming, But Don't Expect a Recovery in 2019 appeared first on InvestorPlace.
The latest competitive threats to the once unstoppable Nvidia (NASDAQ:NVDA) have challenged some investors this week. But with varied strong positioning and catalysts up its own sleeve, bullish investors shouldn't give up on the end game in NVDA stock yet. Let me explain.Source: Shutterstock As most any investor with a passing interest in the stock market knows, not too long ago NVDA was a growth superstar off and on the price chart that could do no wrong. The sky was seemingly the limit for Nvidia. Unsurprisingly, a couple years of the overly-bullish narrative, those cocksure days ended abruptly in late 2018.The latest challenge to NVDA resurrecting its former glory comes from Advanced Micro Devices (NASDAQ:AMD). As InvestorPlace's Brad Moon recently discussed, AMD's roll-out this past week of its new Ryzen 3000 processors and Navi-based Radeon 5700 graphics cards and what the company calls the "Ultimate PC Gaming Platform" is living up to that boast in the early innings.InvestorPlace - Stock Market News, Stock Advice & Trading TipsBut as Nvidia investors also know, but maybe need a reminder of, NVDA isn't a one-trick pony. And the big picture for this tech powerhouse remains very promising despite challenges from the likes of AMD or more ubiquitous geopolitical challenges such as today's trade war with China.Bottom line, Nvidia has a strong presence in markets ranging from autonomous and driverless vehicles, to data centers, artificial intelligence, a re-emerging cryptocurrency market and yes, even still the gaming industry. What's more, on the price chart the bottom line for NVDA's big picture looks equally promising in more than one way for bullish investors. NVDA Stock Monthly Chart Click to EnlargeTechnically speaking, the 'end game' or big picture amounts to appreciating NVDA's constructive, not destructive monthly chart since last October. Bottom line, all stocks, in particular companies with once-glowing growth expectations, have large price corrections at one time or another.From Amazon (NASDAQ:AMZN) to Microsoft (NASDAQ:MSFT), corrections are an investing commonality which no company is immune. Of course, each incident will have its own unique reasons for this once unthinkable inevitability occurring and an in-tow bearish narrative getting the best of investors. Such is the case in Nvidia stock.The good news for NVDA investors is what's done, is likely done as far as the correction is concerned. Despite overall sentiment remaining bearish to cautiously optimistic at best, the price chart has established a confirmed lower-high double bottom backed by a key test of long-term Fibonacci supports. Positioning in NVDA StockFrom where I sit, investors have two ways to play NVDA. One method is to put shares on the radar for buying above the market if a higher high pivot is formed to confirm a monthly uptrend. Set your trade alert for the April high of $193.25. Investors can then decide whether to buy momentum or wait for the next meaningful pullback to establish a long position in Nvidia.The second strategy simply purchases NVDA today. With shares near the confirmation price of the bottoming candle's high of $165.37, buying the stock right now is a reasonable venture. For managing risk I'd suggest an initial stop 10% below the purchase price. * 10 Stocks to Sell for an Economic Slowdown In a volatile stock like NVDA this exit strategy contains risk as reasonably as can be expected. It also serves the purpose of technically exiting the position if shares fall deep enough into June's monthly range. In our technical opinion, that kind of price action would strongly suggest NVDA stock still has a long road ahead of itself, before possibly securing its place among other legendary investments.Disclosure: Investment accounts under Christopher Tyler's management currently own positions in Advanced Micro Devices (AMD) and its derivatives, but no other securities mentioned in this article. The information offered is based upon Christopher Tyler's observations and strictly intended for educational purposes only; the use of which is the responsibility of the individual. For additional market insights and related musings, follow Chris on Twitter @Options_CAT and StockTwits. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 Stocks to Sell for an Economic Slowdown * 7 Marijuana Penny Stocks That I May Buy * 7 of The Best Schwab ETFs for Low Fees The post 2 Ways to Buy Nvidia Stock on Competition Worries appeared first on InvestorPlace.
After several years of major market outperformance, semiconductor giant NVIDIA Corporation (NASDAQ: NVDA) has traded mostly in-line with the market so far in 2019. Nvidia’s inference technology coupled with artificial intelligence spending by cloud providers will create a perfect storm of demand for the chipmaker, Ross said in a Thursday upgrade note. Unfortunately, hese trends will likely not have a significant impact on Nvidia’s revenue numbers until the fourth quarter of 2019, Ross said — but added that investors can expect better visibility and positive commentary from management in the next two quarters.