Nvidia: How the chip stock historically behaves after earnings

Yahoo

22-05-2025

Semiconductor giant Nvidia (NVDA) is due to release its first quarter earnings results on Wednesday, May 28, closing out earnings season for the Magnificent Seven.
Ahead of the chipmaker's big day next week, Yahoo Finance markets and data editor Jared Blikre — who also hosts the Stocks In Translation podcast — takes a closer look at how Nvidia's stock has historically performed in the lead up to and following earnings reports
Twice a week, Stocks In Translation cuts through the market mayhem, noisy numbers and hyperbole to give you the information you need to make the right trade for your portfolio. You can find more episodes here, or watch on your favorite streaming service.
To watch more expert insights and analysis on the latest market action, check out more Catalysts here.
Our Nvidia number of the day, $162. That's the median analyst price target for Nvidia shares. And that's nearly 20% north of the current share price. But what does this number actually represent? It's a blend of expectations about Nvidia's growth, profits, and market trends. Investors often use these targets to gauge Wall Street sentiment, but remember, targets are not necessarily guarantees.
Big event on deck, Nvidia reports first-quarter earnings, and the options market is already buzzing. But what should investors expect from the stock after the report drops? I'm Jared Blikre, host of Stocks and Translation. First, the big picture. Historically, Nvidia stock reaction is a mixed bag, but leaning bullish immediately after earnings with median gains of just two to 4% over the first month. But then watch out, the stock tends to blast off about 18% historical gains by the end of the quarter and a whopping 117% return one year later. And the longer you hurt, the longer you hold, the better your odds. A positive outcome happens about 83% of the time after one year. Now, let's zero in on the AI area. This is the past 10 reports. So, artificial intelligence has been the name of the game, stretching back two and a half years. The stock's next-day pop is averaged nearly 12%, but the options market is only pricing in a 7.4% move after the report. That means traders might be underestimating the impact of Nvidia's earnings. But outside of earnings, Nvidia's typical daily move is only about 4.5%. This means earnings days are two to three times as volatile, and here's the scorecard. Six big wins with an average gain of 11% over the last 10 reports against four losses with average dips of about 5%. Basically a coin flip, but the wins have paid much bigger than the losses. And if you're a long-term holder, here's your rolling gauge. Nvidia's one-year returns measured from each earnings date are currently at all-time highs. Multiple years it posted gains over 100%, with only brief dips below zero since 2010. Momentum clearly favors patient holders. But this number has dipped below zero before, so there are no guarantees. And the bottom line for traders, expect wild short-term swings, but over the long run, Nvidia's trajectory has tended to be up. And here's a pro tip, given history, options might actually be cheap here. So volatility buyers, take notice. Well, Nvidia's report, will it extend this incredible streak, or will it break the trend? Stay tuned. And tune into Stocks and Translation for more jargon-busting deep dives, new episodes on Tuesdays and Thursdays on Yahoo Finance's website or wherever you find your podcast.