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Nvidia (NVDA) Stock Sinks As Market Gains: What You Should Know

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In the latest trading session, Nvidia (NVDA - Free Report) closed at $149.87, marking a -0.38% move from the previous day. This change lagged the S&P 500's daily gain of 1.07%. At the same time, the Dow added 0.65%, and the tech-heavy Nasdaq gained 1.71%.

Coming into today, shares of the maker of graphics chips for gaming and artificial intelligence had gained 4.78% in the past month. In that same time, the Computer and Technology sector lost 2.02%, while the S&P 500 lost 0.58%.

Investors will be hoping for strength from NVDA as it approaches its next earnings release, which is expected to be February 14, 2019. The company is expected to report EPS of $1.40, down 18.6% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $2.70 billion, down 7.18% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $7.24 per share and revenue of $12.21 billion. These totals would mark changes of +47.15% and +25.73%, respectively, from last year.

Investors should also note any recent changes to analyst estimates for NVDA. These recent revisions tend to reflect the evolving nature of short-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 0.05% lower within the past month. NVDA is holding a Zacks Rank of #4 (Sell) right now.

Digging into valuation, NVDA currently has a Forward P/E ratio of 20.79. This represents a premium compared to its industry's average Forward P/E of 12.35.

It is also worth noting that NVDA currently has a PEG ratio of 1.95. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. Semiconductor - General stocks are, on average, holding a PEG ratio of 1.85 based on yesterday's closing prices.

The Semiconductor - General industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 178, which puts it in the bottom 31% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Make sure to utilize Zacks. Com to follow all of these stock-moving metrics, and more, in the coming trading sessions.


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