Back to top

Image: Bigstock

Here's Why Nvidia (NVDA) is a Zacks Rank #1 (Strong Buy) Stock

Read MoreHide Full Article

Nvidia Corporation (NVDA - Free Report) , a leading developer of graphics processors and related software, is one of the latest additions to the Zacks Rank #1 (Strong Buy) list. The semiconductors industry is showing great strength right now, and today we’ll take a look at why Nvidia stands at the top of it.

Nvidia was able to grab a Zacks Rank #1 (Strong Buy) listing based on its most up-to-date earnings data. Last week, the company posted second-quarter earnings of 44 cents per share, which beat the Zacks Consensus Estimate by 7 cents.

Nvidia also reported revenues of $1.428 billion for the quarter, which beat our estimate of $1.355 billion and represents growth of 23.9% on a year-over-year basis. If you’d like all the details from the company’s latest report, check out our full coverage of Nvidia’s Q2 Earnings Beat.

Perhaps the most important aspect of Nvidia’s earnings report was the company’s Q3 guidance. For the third quarter of fiscal 2017, NVIDIA expects revenues of approximately $1.68 billion (+/-2%). At the time of the announcement, the Zacks Consensus Estimate was pegged at $1.446 billion.

As a result of Nvidia’s strong performance and guidance, analysts have been busy revising their estimates for the rest of the fiscal year. In the past week, we have seen 11 positive revisions for Nvidia’s third-quarter earnings, as well as 10 positive revisions for its fourth-quarter earnings.

Looking ahead, the Zacks Consensus Estimate for Nvidia’s Q3 earnings now stands at 56 cents per share, which would represent growth of 38.75%. The company’s fourth-quarter earnings are now expected to come in at 55 cents per share, which would represent growth of 56.88%.

On top of its strong earnings-related data, Nvidia boasts “A” grades in both the Growth and Momentum categories of our Style Scores system. The stock has been on an incredibly impressive run, with shares up over 80% on the year.

Nvidia has performed very well recently, and all signs point to even further growth potential. This stock is certainly worthy of its Zacks Rank #1 (Strong Buy). For more on the factor’s contributing to its earnings report, as well as some commentary on the state of the semiconductor industry, check out our Nvidia Earnings Preview from last week: 

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 DaysClick to get this free report >>


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


NVIDIA Corporation (NVDA) - free report >>