Latest news with #NVDA
Business Insider
3 hours ago
- Business
- Business Insider
NVDA, TSLA, GOOGL: U.S. Stocks Post Best May Performance Since 1990
There's a saying on Wall Street called 'sell in May and go away' that refers to the tendency for equities to decline during the month. But not this year. Confident Investing Starts Here: As May 2025 draws to a close, the S&P 500 index is on pace for its best monthly performance since 2023. The benchmark index is also on track for its biggest gains during the month of May since 1990, according to Dow Jones Market Data. On the last trading day of the month, the S&P 500 is up 6% this May after plunging nearly 20% in April as U.S. President Donald Trump unveiled his tariff policies. Other U.S. indices also registered strong gains during May 2025, with the Nasdaq Composite index gaining nearly 10% as major technology names such as Nvidia (NVDA), Tesla (TSLA), and Alphabet (GOOGL) rebounded strongly from their April lows. NVDA and TSLA stocks each rose more than 20% in the month. The blue-chip Dow Jones Industrial Average increased 4% in May of this year. For U.S. equities, May has represented a big turnaround after the S&P 500 declined for three consecutive months. As President Trump eased many of his tariffs and entered into trade negotiations with different countries, including China, it has injected renewed confidence into the markets, say analysts. At the same time, economic data out of the U.S. has remained strong and showed signs of resilience. On May 30, the last trading day of the month, data showed that U.S. inflation declined to an annualized rate of 2.1% in April, lower than the consensus expectation of economists. Is GOOGL Stock a Buy? The stock of Alphabet has a consensus Strong Buy rating among 38 Wall Street analysts. That rating is based on 29 Buy and nine Hold recommendations issued in the last three months. The average GOOGL price target of $199.14 implies 17.31% upside from current levels.
Yahoo
9 hours ago
- Business
- Yahoo
Nvidia, Other Chip Stocks Slide Amid Worries About US-China Trade Tensions
Nvidia (NVDA) and other semiconductor stocks slid Friday amid worries about worsening U.S.-China trade tensions. Shares of Nvidia were down nearly 4% in recent trading. Advanced Micro Devices (AMD), Broadcom (AVGO), Micron Technology (MU), and Applied Materials (AMAT) also lost ground, with the PHLX Semiconductor Index (SOX) dropping about 3%. Some of Nvidia's partners, including server maker Super Micro Computer (SMCI), saw their stocks fall as well. (Read Investopedia's full coverage of today's trading here.) President Trump on Friday said China has "totally violated its agreement with us," dampening hopes the countries would soon come to a longer-term agreement after reaching a temporary truce earlier this month. Separately, Bloomberg reported Friday that Trump plans to expand U.S. companies' licensing requirements to make deals with Chinese companies that have ties to sanctioned firms. The development comes after the Trump administration moved earlier this month to rescind the Biden-era AI diffusion rule that would have further curbed sales of American AI hardware to a broader group of countries, but warned it's looking to replace the rule with new restrictions. Analysts at Citi and Deutsche Bank warned at the time that they could turn out to be stricter than Biden's. During Nvidia's earnings call on Wednesday, CEO Jensen Huang said it's "terrific" that Trump rescinded the Biden-era rule, but criticized the administration's other moves to limit its sales to China, saying that "shielding Chinese chipmakers from U.S. competition only strengthens them abroad and weakens America's position." The AI chipmaker took a $4.5 billion charge in its fiscal first quarter associated with new export curbs on the company's H20 chips to China, and said it expects to take an $8 billion hit in the current quarter due to lost revenue. Read the original article on Investopedia
Yahoo
9 hours ago
- Business
- Yahoo
Super Micro's Stock Slumps Even as NVIDIA Tie-Up Heats Up
May 30 - Super Micro Computer Inc. (NASDAQ:SMCI) shares slid nearly 3% to $39.7 on Friday afternoon, falling 57% back from a 52-week high of $101.40 amid broader tech sector pressure. Warning! GuruFocus has detected 5 Warning Signs with SMCI. Despite trade-tariff uncertainties, SMCI finds support in its link to NVIDIA (NASDAQ:NVDA) and the rising demand for Blackwell chips. As NVDA's new AI solutions gain traction, data centers require advanced servers and cooling, areas where SMCI specializes. SMCI recently shook off past accounting concerns by installing a new auditing team, helping to restore investor confidence. That groundwork set the stage for a major win: the Saudi government tapped SMCI to build AI-focused data centers, signaling faith in its Foundry servers. NVDA's strong quarterly results have left a gap in data-center maintenance, precisely the niche SMCI can fill. With NVDA's Blackwell chips fueling orders, SMCI may see further upside as AI infrastructure spending climbs. For bulls, SMCI's role in supporting NVDA's Blackwell ecosystem offers a clear catalyst, even as tariffs and macro headwinds persist. Based on the one year price targets offered by 15 analysts, the average target price for Super Micro Computer Inc is $40.00 with a high estimate of $70.00 and a low estimate of $15.00. The average target implies a upside of +0.68% from the current price of $39.73. Based on GuruFocus estimates, the estimated GF Value for Super Micro Computer Inc in one year is $67.82, suggesting a upside of +70.72% from the current price of $39.73. This article first appeared on GuruFocus. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Globe and Mail
10 hours ago
- Business
- Globe and Mail
Nvidia's Free Cash Flow and FCF Margins Skyrocket - NVDA Stock Looks Cheap
Nvidia Inc. (NVDA) reported strong revenue, free cash flow (FCF), and FCF margins for its fiscal Q1 ended April 27, 2025. This implies a much higher valuation for NVDA stock, over $191 per share. Short put plays are also attractive here, and they have high yields. NVDA is off today at $134.18 in midday trading. This provides a good buy opportunity for value investors, as this article will show. I previewed Nvidia's FCF and FCF margins and a valuation (price target) in my May 25 Barchart article. I suggested NVDA was worth $161.48. Now, I'm upgrading this target to over $191 per share. That represents a potential gain of 43% above today's price. Here's why. Strong Free Cash Flow (FCF) Nvidia's Q1 revenue of $44.06 billion was stronger than guided for the quarter (my estimate was $43.2 billion). That represented a gain of almost 12% over the prior quarter (+11.9% from $39.331 billion). The same was true for its adjusted gross margin (i.e., 71.5% vs. management's guidance of up to 71%). However, the astounding news was its free cash flow (FCF) and FCF margins. This can be seen in the table below. It shows that its FCF skyrocketed 68% over the prior quarter and 75% YoY. More importantly, it shows that as a percent of revenue, i.e., its FCF margins, Nvidia's results were stellar. The FCF margin rose to over 59% from about 40% in the prior quarter and 57% a year earlier. In addition, its capital expenditures (capex) rose from $1.077 billion last quarter to $1.227 billion in Q1. In other words, Nvidia's management has been squeezing more cash out of operations, despite higher capex spending and higher revenue. This is a sign of operating leverage - i.e., FCF rises as a percent of revenue as sales rise. The bottom line is that this has huge implications for the value of Nvidia stock. I was previously expecting a FCF margin of just 39.5%. With its recent 59.3% FCF margin, the company has generated significantly more FCF as a percent of revenue over the last year. For example, Seeking Alpha now shows that the trailing 12-month (TTM) operating cash flow ending April 2025 was $76.158 billion. After deducting $4.094 billion in capex spending over the last year, its FCF was $72.064 billion. That represented 48.5% of its TTM revenue of $148.515 billion, according to Seeking Alpha. We can use that FCF margin to estimate FCF going forward. Price Targets for NVDA Stock Analysts now project that revenue this year ending Jan. 31, 2026, will rise to $199.75 billion and $251 billion next year. That puts it on a run-rate revenue for the next 12 months (NTM) of $225 billion. So, to be conservative, let's say that FCF margins will average 48% over the next 12 months (NTM): $225b NTM sales x 48% FCF margin = $108 billion FCF est. This is significantly higher than the $76 billion it made over the last 12 months ($76.158 billion) and $60.85 billion it made in 2024. As a result, the market is likely to give NVDA stock at least a 2.3% FCF yield (i.e., a 43x multiple). Here is how that works: $108b x 43 = $4,644 billion, or $4.64 trillion market value That is 18.8% higher than today's market value of $3,256 billion, according to Yahoo! Finance. In other words, NVDA stock is worth 42.6% more than its price today of $134.18: $134.18 x 1.426 = $191.34 p/sh This means over the next year, if Nvidia averages a 48% FCF margin, its market value and price could rise 43% from today's price. Analysts tend to agree. Barchart reports that the mean price is $167 with a high of $220. AnaChart's average price target is now $177.68 from 40 analysts. That is up from $169.78, as I reported last week. Shorting OTM Puts However, this could take a while to occur. One way to set a lower buy-in target, or, for existing shareholders, to get paid while waiting for the stock to rise, is to short out-of-the-money (OTM) put options. For example, the July 3 put options at the $130 strike price (i.e., 3% below today's price) have a midpoint premium of $4.73. That represents an immediate yield of 3.64% ($4.73/130 = 0.03638) to a short-seller. However, this is fairly close to today's price, and more risk-averse investors may want to set a lower put strike price. The $128 put option has a premium of $4.00, but that is still a very high yield of 3.125% (i.e., $4.00/$128.00 = 0.03125). This still has a fairly high delta ratio of 33%, implying a one-third chance that NVDA could fall to $128 over the next 34 days. Typically, an investor wants to short puts with slightly lower delta ratios. For example, the $126.00 strike price put option, 6.3% out-of-the-money, has a 27% delta ratio with a premium of $3.10 at the midpoint. That still represents a high yield of 2.46% for a short-seller. As a result, an investor can set a series of trades that could produce an average 3.0% yield over the next month, to July 3. These would likely have an average strike price around 4.5% to 5% below today's price. The breakeven points would be even lower. The bottom line is that NVDA stock looks very cheap here. Shorting out-of-the-money (OTM) put options in one-month out expiry periods provides high yields and lower buy-in target prices.
Yahoo
10 hours ago
- Business
- Yahoo
Super Micro's Stock Slumps Even as NVIDIA Tie-Up Heats Up
May 30 - Super Micro Computer Inc. (NASDAQ:SMCI) shares slid nearly 3% to $39.7 on Friday afternoon, falling 57% back from a 52-week high of $101.40 amid broader tech sector pressure. Warning! GuruFocus has detected 5 Warning Signs with SMCI. Despite trade-tariff uncertainties, SMCI finds support in its link to NVIDIA (NASDAQ:NVDA) and the rising demand for Blackwell chips. As NVDA's new AI solutions gain traction, data centers require advanced servers and cooling, areas where SMCI specializes. SMCI recently shook off past accounting concerns by installing a new auditing team, helping to restore investor confidence. That groundwork set the stage for a major win: the Saudi government tapped SMCI to build AI-focused data centers, signaling faith in its Foundry servers. NVDA's strong quarterly results have left a gap in data-center maintenance, precisely the niche SMCI can fill. With NVDA's Blackwell chips fueling orders, SMCI may see further upside as AI infrastructure spending climbs. For bulls, SMCI's role in supporting NVDA's Blackwell ecosystem offers a clear catalyst, even as tariffs and macro headwinds persist. Based on the one year price targets offered by 15 analysts, the average target price for Super Micro Computer Inc is $40.00 with a high estimate of $70.00 and a low estimate of $15.00. The average target implies a upside of +0.68% from the current price of $39.73. Based on GuruFocus estimates, the estimated GF Value for Super Micro Computer Inc in one year is $67.82, suggesting a upside of +70.72% from the current price of $39.73. This article first appeared on GuruFocus. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
