by winston » Thu Nov 29, 2018 10:47 pm
not vested
Best Stocks to Invest in Right Now: Nvida (NVDA)
Chipmaker Nvidia (NASDAQ:NVDA) has lost 50% of its value because of a hit to 10% of its business (cryptocurrency), and the stock now sits at its lowest valuation in four years, a level it won’t remain at for long, considering still robust growth in the company’s core AI and data markets.
2 Minute Drill: In a nutshell, NVDA stock has lost about half of its value because of the cryptocurrency bubble popping. That big pop created an inventory problem for the company which will take one to two quarters to work through. As such, revenue growth and margins over the next one to two quarters will be depressed, and NVDA stock is consequently adjusting lower.
But nothing about this recent selloff changes the long-term growth narrative supporting Nvidia stock. That long-term growth narrative is all about secular growth in the AI, IoT and data center markets. All those businesses continue to do quite well.
In Q3, the data center, pro visualization and automotive businesses all reported record revenues. The data center business grew by nearly 60% year-over-year. The pro visualization business was up nearly 30%. The automotive business was up nearly 20%.
Thus, with NVDA stock, you have a long-term bullish narrative getting a near-term shock. The shock happened, the stock dropped, and the valuation is now at its lowest levels in four years and 60% off its 2018 highs.
Because of the company’s exposure to high-demand and big-growth AI and data markets, NVDA stock won’t remain this cheap for long. As such, buying the dip now seems like the right move.
Source: Investor Place
It's all about "how much you made when you were right" & "how little you lost when you were wrong"