Nvidia: Why Its Lead Over Competitors May Be As Short As One Year (Archive)
Nvidia’s rosy fundamentals face rising competitive pressure and slowing bullish momentum.
This 5-Minute Pitch was originally published on Seeking Alpha before the launch of the Hunting Alphas website. It is shared here to showcase my previous work and track record. New 5-Minute Pitches published on this site will not be disseminated anywhere else.
Elevator Pitch
- Nvidia's leading revenue indicators are very robust, as evidenced by strong revenue growth in one of its major suppliers, a large uptick in remaining performance obligations, and encouraging revenue visibility.
- But competitive threats are intensifying as major cloud service providers may be gaining bargaining power and looking for cheaper alternatives such as Google's TPUs.
- NVDA trades at a 10% discount to its sector median 1-year forward P/E and its valuation multiple has remained flat to slightly lower despite rising earnings expectations. This is encouraging.
- The bullish momentum on the NVDA/SPX500 charts is slowing down, which increases the risks of a deeper correction.
Read the full article here.
Disclosures and Disclaimers
Past performance ≠ future results. Not investment advice. See full Disclaimer.
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