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Why Nvidia Stock Went Up Over 40% Since January

Aug. 03, 2021 12:40 PM ETNVIDIA Corporation (NVDA) Stock31 Comments


  • Nvidia's stock price went up over 40% since January 2021, and its current share price is only -5% below its all-time historical high registered in early July 2021.
  • I think Nvidia stock is going up, because of its good financial performance, a smaller-than-expected negative impact relating to the semiconductor chip shortage, and optimism regarding the Arm acquisition.
  • Nvidia currently trades at consensus forward FY 2023 EV/EBITDA and P/E multiples of 46.1 times and 45.5 times, respectively, and I view Nvidia's stock as a Hold.
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Graphics Chip Maker Nvidia Reports Quarterly Earnings
Justin Sullivan/Getty Images News

Elevator Pitch

I still keep my Neutral rating for Nvidia Corporation (NASDAQ:NVDA).

Nvidia's stock price went up over 40% since January 2021, and its current share price is only -5% below its all-time historical high registered in early July

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This article was written by

The Value Pendulum profile picture

The Value Pendulum is an Asian equity market specialist with over a decade of experience on both the buy and sell sides.

He is the author of the investing group Asia Value & Moat Stocks, providing ideas for value investors seeking investment opportunities listed in Asia, with a particular focus on the Hong Kong market. He hunts for deep value balance sheet bargains and wide moat stocks and provides a range of watch lists with monthly updates within his investing group.

Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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Comments (31)

Mike Bruzzone profile picture
Real Nvidia, AMD, Intel production, and an accurate accounting on x86 in-house traditional tracking method for WW market share is posted here top of comment string;


Mike Bruzzone, Camp Marketing
Good value now at $200.
Next week earnings will push stock up 5-10%.
Get in soon!
Hudson Investments profile picture
Consensus indicates a beat but how will it actually go? And what will the forward guidance be?
Hudson Investments profile picture
August 18, 2021 earnings cal will tell the tale of NVDA. Bothe a beat in both Revenue and EPS plus good forward guidance will propel the stock higher.

I see the stock at $250.
grxbstrd profile picture
OT: Amazons new autonomous trucks powered by NVDA technology.

@grxbstrd Thanks for the AMZN/NVDA article. I assume you’re positive on the ARM deal. What are your odds on the deal going forward.
grxbstrd profile picture
@jarco thansk for your comments. I've always been optimistic about the deal because I think Jensen has very recent knowledge (from Mellanox) about how to get it done in the face of brutal political environment. Everyone thought that deal was dead too.

I've always thought odds were 50/50, but as I say I bias to optimistic. My view is there are forces at work trying to sour the deal in the press and with regulators. You can look back at my history to find recent comments on that if you're interested.

I'll remain optimistic until there is some real data one way or the other. NVDA just kept on extending the MLNX deadline until they landed it, I'm hopeful this one follows the same path.
Its up because valuations do not matter anymore. Just buy it at any cost and then retire.
THE GUNNAH profile picture
UK Regulator may not like the idea but how would you feel if you were them? Biggest jewel they have being bought by…Americans 😂. Feelings will be hurt when they are one but not if you own it! Don’t fall for the negative articles! The fact that they are already producing products jointly and Nvidia has unfettered access to their architecture is just dandy! NividiArm products are already for sale!!! Say what you want, it’s a done deal the official approval is merely window dressing!
Mike Bruzzone profile picture
At the 46th week of Ampere WW channel supply, last week, inventory is gaining for the prior three weeks however off peak holdings of June 19th by 20%.

At June 19th peak supply week 40, inventory had ramped consistently from week 36 gaining 282%, sold off through week 44, then began current ascent.

From week 10 through 35 peak output was consistent on jagged trading drops and pops.

This analyst on historic volume and Turing percent of supply volume per quarter entered peak production last quarter that will crest q3 with run down beginning q4. q2 through q4 production represents 50% of all Ampere output over an eight quarter run of 67 million units subsequently 33,298,718 units q2 through q4.

Range low is 23,358,802 units however if Nvidia 2021 aim is above the 100 M total units produced in 2020, in 2021 aiming for 130 M units total output of all kinds, 2021 second half volume will be the greater of the two projections.

Noteworthy after AMD supply falling to a low of 12% dGPU share in q2, on financial reconcile on channel data production output in q2 grew to 4.7 M units up 400% over q1 at 944 K.

My question is how will production be divided between consumer and commercial markets. AMD needed to come back in the consumer 'gaming' sector and Nvidia, well, there are consumer supply voids that need address.

I predict a channel show down between Nividia 3080/70 8 GiB and 6700XT 12 GiB on channel clearing volumes of these three SKUs representing 54.52% and 39.44% of their respective full runs to date. Essentially channel liquidation where volume retail competes with itself to monopolize peak output on elastic pricing to refinance for q4 into q2 2022 restocking. If this does not occur raises questions about where Nvidia supply is ending up and emphasis on Nvidia channel sales administration to clear the channel at peak production output preventing back up in the supply chain.

I estimate as many as 2.4 M 3060 12 GiB could be added to WW channel supply through year end where 3060 is 12.57% of Ampere full run currently and 3060ti wide bus 8 GiB 7.99%. I also expect to see a pop in Quadro available currently 0.13%

AMD on q2 production volume needed a response and 6600XT seems to be it? As 3080/70 price falls 6700XT ends up in that avalanche I'll know as the quarter progresses. MSRP on elastic pricing needs to be resolved by and at these retail sales gates; Back to School, Black Friday, Cyber Monday and Year end Holiday and Super introduction.

Finally on the question of where is Nvidia production actually ending up, what segment, I have a suspicion division revenue swing to data center continues on so many out of consumer stock indicators but how can that be an peak output?

Now that Vermeer 5x is at and below MSRP in the channel why not dGPU? Let's go here Nvidia and AMDand board house sales people, design producers do not let components and finished goods back up in production or supply chain. Adjust those margins and get volumes moving and clearing out even if that means kicking retail butt.

Mike Bruzzone, Camp Marketing
Hudson Investments profile picture
This is a fair analysis.
JosephCortes profile picture
NVDA is a strong buy.
Hudson Investments profile picture
@JosephCortes BAC Merrill likes NVDA at $250 price objective.
@The Value Pendulum "Hold" is not a neutral position, it is a bullish one. By definition, it implies that the stock will perform better than holding cash.

Please consider initiate a position on the stock before soliciting advice or at the very least change your rating to one that can be falsified.

I am tired of all the "neutral" ratings lately, as well as anyone playing it safe with no skin in the game whatsoever.
Gary J is Rich on AMZN profile picture
@Curious_Kid lol he needs initiate exactly nothing to validate his opinions.
@Gary J is Rich on AMZN A "neutral" opinion (read: there are positives but also risks) is as close as it gets to a tautology and thus already "validated" (unfalsifiable) by default. Do you see the problem here?
THE GUNNAH profile picture
I’m a big believer in NVDA. I have had it since 6/15/15 @ a very attractive $20.90 per share! I have trimmed a little bit so I could diversify into the biotechnology sector. ARM deal is a moot point now that they have been in collaboration for over a year now and have already brought these new products to market. UK needs this deal if only to retain its crown jewel in country. Nvidia has made promises to build a technology campus to develop and retain future IT employees. They actually complained that Nvidia has not submitted the paperwork yet? Jenson said it would not close until F/Y 22 so far so good! China moved it back on its agenda after going through it for months now! I believe they would have simply said it is an outright No! If that was the case. US is the biggest hurdle with Qualcomm and NXP leading the pack of stale chips as they see any advantage they had go poof💭 when it is finalized. One thing that you need to know about CEO Jenson Huang is he doesn’t exaggerate in any way! When he says the approval process is going just like we anticipated it would. I’m guessing he has built an algorithm that told him that it not only would be approved but also the date of the approval will be made public. Nvidiarm has a nice Ka Ching to it!
Pierre Rossouw profile picture
@THE GUNNAH How often do we se a "sell" recommendation? When last?
This tells us that those putting forward the recommendations are not applying any minds.
Gary J is Rich on AMZN profile picture
@Pierre Rossouw Seldom because the market goes up in general.
03 Aug. 2021
That ARM deal looks more questionable everyday. I'm recently in the stock at $184. I sold covered calls, the Oct $215. I'm waiting semi-patiently for the "greater fool" to come along and exercise that option. If that doesn't happen, I'll rinse and repeat. Good luck to the longs!
check-mate profile picture
The greater fool as you call someone will only exercise the call option you sold if nvda is 215 on strike date or greater . Why would you call said person a fool.
In fact after earnings nvda may move up to let’s say 205, if so the calls will double and said fool will have doubled his money.
@doc47 there is nothing I'm aware of to suggest the deal is in more jeopardy than before: A SA article cited speculation about a public float that everyone already heard about , and may be 100% false propaganda... several NVDA competitors like INTC already made it known they don't like competition (eg NVDA Taking over Data center wholesale)... a grumpy Austrian-Brit has made it clear he wish he hadn't left ARM in the 90s, and opposes anything for any reason. Tesla opposes it, but shocker, NVDA develops the DRIVE systems for it's compeitors. The arguments against seem pathetically vague and weak, BUT, who knows whose hands are in whose deep pockets. We'll certainly see.
Hudson Investments profile picture
@check-mate United Kingdom’s regulator doesn’t like the Arm deal.
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