Nvidia, the leading AI company, is set to release its earnings report on February 21, 2024. This event has garnered significant attention from investors and market analysts, as the outcome could have a profound impact on the broader market. The anticipation surrounding Nvidia’s earnings report highlights the extraordinary influence the company holds in the tech industry.
Despite the potential for triple-digit-percentage earnings growth in its most recent quarter, there is a sense of caution among investors. Even if Nvidia surpasses expectations and outlines two more quarters of impressive growth, it may not be enough to satisfy the high demands of investors who have already driven the stock up by 55% since the beginning of the year.
This sentiment is echoed in a recent note from Bank of America’s chips analyst, Vivek Arya. Arya acknowledges the possibility of a notable but brief pullback in Nvidia’s stock following its parabolic run-up. Bloomberg options indicate an estimated 11% implied move post-earnings. Expectations have been steadily increasing, with some bullish buy-side estimates projecting Nvidia’s F4Q/1Q report and guided sales to be $21.7 billion/$23 billion, respectively. These figures are 9% and 7% above consensus, leaving less room for upside surprises.
Despite these concerns, Arya maintains a Buy rating and sets a $800 price target on Nvidia. He believes that any potential mismatch between Nvidia’s performance and bullish expectations is likely due to supply issues, such as memory and packaging, rather than demand or competition-related factors. Arya also highlights the upcoming GPU Tech Conference (GTC) scheduled for March 18-21 as a crucial event that investors should look forward to. This conference will provide updates on Nvidia’s pipeline, partnerships, and AI total addressable market (TAM). Historically, Nvidia’s stock has experienced an average increase of 6% in the days following the last six annual GTC events, outperforming the S&P 500 index.
The hype surrounding Nvidia’s earnings report and the subsequent market reaction is a testament to the company’s dominance in the AI industry. As the leader of the King of Chips, Nvidia’s performance has far-reaching implications for the tech sector and beyond. Investors eagerly await the earnings report, hoping for positive news that will continue to drive Nvidia’s stock to new heights. However, it remains to be seen whether the company can meet these lofty expectations and maintain its impressive growth trajectory.
In conclusion, Nvidia’s upcoming earnings report has generated significant excitement and speculation among investors. The potential market impact and investor expectations surrounding the report highlight the immense influence Nvidia holds in the tech industry. While there are concerns about meeting bullish expectations, analysts remain optimistic about Nvidia’s long-term prospects. The company’s flagship GPU Tech Conference further adds to the anticipation, as it promises important updates on Nvidia’s pipeline, partnerships, and AI total addressable market. As the world eagerly awaits the earnings report, it is clear that Nvidia’s position as a leading AI player continues to captivate investors and market observers alike.
