Wall Street is placing bets on Nvidia (NVDA.O), which releases a new tab on Wednesday, to release a massive quarterly report. The company’s stock is already trading close to record highs as investors want proof that the AI chipmaker can continue its rapid growth and remain ahead of competitors.
The outcomes will represent the most recent trial for Wall Street’s pick-and-shovels strategy, which has made Nvidia the largest beneficiary of the generative AI boom due to its chips’ central role in driving products like OpenAI’s ChatGPT and Google’s Gemini.
“There is a lot riding on Nvidia’s results. “It is the most significant stock in the industry,” stated Will Rhind, CEO and founder of GraniteShares, an ETF that holds chips.
Since the beginning of 2023, the value of Nvidia’s shares has increased by almost six times, making it the third most valuable company on Wall Street with a valuation of over $2.30 trillion. The market value of Nvidia increases as shares related to AI rise. The market value of Nvidia increases as shares related to AI rise.
According to LSEG statistics, Nvidia’s 89% stock rise in 2024 has helped boost the whole market. It currently owns 5% of the S&P 500 (.SPX), opens new tab. Analyst estimates for Nvidia’s future profits have increased even more quickly than the company’s stock price. According to LSEG statistics, that last left the stock selling at around 35 times projected profits, down from a top of over 80 last June.
It’s possible that Nvidia’s incredible value has more space to rise. “It is undervalued relative to where forecasts are going,” Rhind stated. Based on LSEG data as of May 17, analysts anticipate Nvidia will post revenue that jumps 242% to $24.60 billion for the fiscal quarter that ends in April. According to the statistics, its sales are predicted to increase by about 97% in the second quarter.
Analysts predict that company will record first-quarter net income of $12.83 billion, up from $2.04 billion in the previous year.
