Nvidia (NVDA) closed at $188.32 in the latest trading session, marking a +2.82% move from the prior day. The stock outperformed the S&P 500, which registered a daily gain of 1.56%. On the other hand, the Dow registered a gain of 1.29%, and the technology-centric Nasdaq increased by 2.21%.
Heading into today, shares of the maker of graphics chips for gaming and artificial intelligence had gained 3% over the past month, outpacing the Computer and Technology sector's gain of 1.06% and the S&P 500's gain of 0.41%.
The investment community will be paying close attention to the earnings performance of Nvidia in its upcoming release. The company is predicted to post an EPS of $1.23, indicating a 51.85% growth compared to the equivalent quarter last year. At the same time, our most recent consensus estimate is projecting a revenue of $54.52 billion, reflecting a 55.4% rise from the equivalent quarter last year.
Looking at the full year, the Zacks Consensus Estimates suggest analysts are expecting earnings of $4.45 per share and revenue of $204.68 billion. These totals would mark changes of +48.83% and +56.85%, respectively, from last year.
Investors should also pay attention to any latest changes in analyst estimates for Nvidia. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, upbeat changes in estimates indicate analysts' favorable outlook on the business health and profitability.
Our research reveals that these estimate alterations are directly linked with the stock price performance in the near future. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.
The Zacks Rank system, ranging from #1 (Strong Buy) to #5 (Strong Sell), possesses a remarkable history of outdoing, externally audited, with #1 stocks returning an average annual gain of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.41% higher. Nvidia is holding a Zacks Rank of #3 (Hold) right now.
In terms of valuation, Nvidia is currently trading at a Forward P/E ratio of 41.15. This signifies a discount in comparison to the average Forward P/E of 48.24 for its industry.
Investors should also note that NVDA has a PEG ratio of 1.25 right now. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. As the market closed yesterday, the Semiconductor - General industry was having an average PEG ratio of 5.15.
The Semiconductor - General industry is part of the Computer and Technology sector. Currently, this industry holds a Zacks Industry Rank of 171, positioning it in the bottom 31% of all 250+ industries.
The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
You can find more information on all of these metrics, and much more, on Zacks.com.
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NVIDIA Corporation (NVDA): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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