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ETFs to Watch Post Stellar Q2 Earnings From Nvidia

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Nvidia (NVDA - Free Report) reported solid second-quarter fiscal 2021 results after market close yesterday, wherein it outpaced the Zacks Consensus Estimate on earnings and revenues. The company offered a solid guidance for the ongoing quarter.

Earnings per share came in at $1.67, beating the Zacks Consensus Estimate of $1.63 and improving from year-ago earnings of $1.24. Revenues grew 50% year over year to $3.87 billion and outpaced the consensus mark of $3.65 billion. The strong results were driven by a surge in data center business, which exceeded gaming for the first time this quarter. Video gaming and other big business is also on the rise and will take center stage next quarter. In fact, data center sales surged 167% to $1.75 billion and gaming revenues rose 26% year over year.

Nvidia provided revenue guidance for the fiscal third quarter of $4.40 billion (+/-2%). This is above the Zacks Consensus Estimate of $3.65 billion (read: Semiconductor ETFs Roaring to New Highs on Solid Earnings).

Despite robust results and an upbeat guidance, shares of NVIDIA fell as much as 2% in after-hours trading on elevated volume. The stock currently has a Zacks Rank #2 (Buy) and a VGM Score of F. It falls within a favorable Zacks industry (placed at the top 12% of 250+ industries).

ETFs to Watch

This has put ETFs with higher allocation to this graphics chipmaker in the spotlight. Below we have highlighted some of the funds:

Global X Robotics & Artificial Intelligence ETF (BOTZ - Free Report)

This fund follows the Indxx Global Robotics & Artificial Intelligence Thematic Index, which seeks to invest in companies that potentially stand to benefit from increased adoption and utilization of robotics and AI, including those involved with industrial robotics and automation, non-industrial robots, and autonomous vehicles. It holds 31 stocks in its basket with NVIDIA occupying the top spot holding 9%. The ETF has AUM of $1.7 billion and average daily volume of 788,000 shares. It charges 68 bps in annual fees (read: 3 Thematic ETFs to Rule in Pandemic-Stricken Q3).

iShares PHLX Semiconductor ETF (SOXX - Free Report)

This ETF offers exposure to 30 U.S. companies that design, manufacture and distribute semiconductors by tracking the PHLX SOX Semiconductor Sector Index. Of these, Nvidia takes the second spot with 9.2% share. The fund has amassed $3.5 billion in its asset base and charges a fee of 46 bps a year. It trades in a solid volume of 596,000 shares and has a Zacks ETF Rank #1 (Strong Buy) with a High risk outlook.

VanEck Vectors Semiconductor ETF (SMH - Free Report)

This ETF has AUM of $2.7 billion and average daily volume of about 3.1 million shares. The fund provides exposure to 25 global semiconductor securities by tracking the MVIS US Listed Semiconductor 25 Index. NVIDIA occupies the second spot with 8.7% of the assets. While the American firms dominate the fund’s holdings with 74.8% assets, Taiwan (14.5%), the Netherlands (8.5%) and Switzerland (2.3%) capture the top four slots in terms of its country exposure. The fund has an expense ratio of 0.35%. It has a Zacks ETF Rank #2 with a High risk outlook.

VanEck Vectors Video Gaming and eSports ETF (ESPO - Free Report)

This fund offers exposure to global companies, involved in video game development, e-sports and related hardware and software by tracking the MVIS Global Video Gaming and eSports Index. Holding 25 stocks in its basket, NVIDIA takes the third spot with 7.9% share. American firms account for one-third of the portfolio, while Japan and China round off the next two with double-digit allocation each. The fund has gathered $435.6 million in its asset base while trading in average daily volume of 173,000 shares. It charges 55 bps in annual fees from investors.

Pacer BioThreat Strategy ETF (VIRS - Free Report)

This fund seeks to invest in U.S.-listed companies whose products or services help to protect against, endure or recover from biological threats to human health. It tracks the LifeSci BioThreat Strategy Index, holding 45 stocks in its basket. Nvidia occupies the top position with 7.9% of assets. The ETF has accumulated $5.5 million in its asset base and charges 70 bps in annual fees. It trades in average daily volume of 12,000 shares (read: Should You Invest in COVID Themed ETFs?).

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