Finance
Nvidia is getting ready to take over the stock market (again).
This is The Takeaway from today’s Morning Brief, that’s possible sign up to receive in your inbox every morning, along with:
Are you ready for the most important earnings report of 2024?
Interestingly enough, this company won the award for the most important earnings report of 2024 (and every quarter in 2023) when it reported three months ago!
I’m talking about Nvidia (NVDA). Earnings will be announced after close of trading on August 28.
Every day I get into the office at 4:20 a.m. and turn on software we use to track which stories and ticker pages are drawing the most interest from Yahoo Finance readers. Everyday is one of the most actively viewed pages on our platform for Nvidia.
The world could be on the brink of an alien attack, and I think people will still hit refresh on the Nvidia ticker page. Investors have become absolutely obsessed with a company they had never heard of two years ago.
I can’t blame them.
Nvidia shares are up 170% in the past year. Nvidia shares are up 3,000% in the past five years.
These are crazy profits, the type that attract the less experienced investor hoping to retire early.
And Nvidia’s story is surprisingly easy to understand, despite the company’s incredibly complicated operations. Nvidia makes the best artificial intelligence chips in a world shaken by AI. Simple. No one even comes close to Nvidia in terms of AI chip performance and forward-looking demand.
I would caution that Nvidia’s setup in the quarterly report is a bit different. While The Street remains super bullish on Nvidia heading into print, they are somewhat cautious amid reported shipping delays for Nvidia’s powerful new AI chip Blackwell.
There’s a good reason for the bullishness, based on a host of recent earnings report signals:
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Taiwan Semiconductor (TSM) just mentioned strong demand for AI in its report.
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AMD (AMD) recently increased sales of data center chips for the third time in a year.
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Super Micro Computer (SMCI) reported strong demand for its liquid cooling solutions.
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Nvidia chip customer Meta (META) just raised its 2024 and 2025 investment guidance by billions.
“We expect Nvidia to report beat/raise results, with the advantage driven by strong demand for Hopper GPUs. Given the Blackwell delay, we believe Nvidia will prioritize ramping up B200 for hyperscalers and has effectively canceled B100, which will be replaced with a lower cost/performance GPU (B200A) aimed at enterprise customers,” said Keybanc analyst John Vinh in a customer note.
To embrace Nvidia’s report, I think investors need to see at least two things:
If this happens, it could shake off a few bears and set the table for what EMJ Capital founder and tech investor Eric Jackson told me on the Opening Bid podcast.
“I say [Nvidia’s value] could double again between now and the end of the year,” Jackson said.
To put that in perspective, Jackson thinks Nvidia’s market cap could reach $6 trillion by the end of the year, up from $3.2 trillion currently.
Jackson reasons that the company is headed there by delivering a very, very strong earnings report this week or in November (or both), showing continued demand for H100 and H200 chips as the potential of its new AI-focused Blackwell chips are utilized.
Rest. It’s going to be a busy week ahead.
Three times a week I have insightful conversations with the biggest names in business and the markets that cross my path Opening bid podcast. Find more episodes on our videohub. Check your favorite streaming service. Or listen and subscribe Apple podcasts, Spotifyor wherever you find your favorite podcasts.
Brian Sozzi is editor-in-chief of Yahoo Finance. Follow Sozzi on X @BrianSozzi and on LinkedIn. Tips about deals, mergers, activist situations or something else? Email brian.sozzi@yahoofinance.com.
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