Opinions Danesh Rohinton
NVIDIA CorporationNVDAPARTIAL SELLJul 25, 2024
Danesh RohintonStock price when the opinion was issued
As of Jul 16, 2026. Market Open.
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Blackwell continues to outpace; demand is unbelievable and are now approaching $100 billion per quarter.
Kevin SimpsonFull stack AI infrastructure platform can minimize competition. Not just the commoditized chip, but in systems, networking, and software. It's an enterprise technology ecosystem. Backbone of the AI buildout. Clear beneficiary of global infrastructure expansion.
Hyperscalers are potentially spending ~$1T USD next year, by 2030 it could be $4T. Will be a beneficiary. Still sees over 50% earnings growth rate over next few years. Inexpensive at well under 1x PEG and 24x PE. Bouncing off 200-day MA right now. Yield is 0.50%.
Stan WongLikes it at these levels. Blackwell chip remains the solution for Gen AI workloads. New Rubin platform will keep it in the lead for years to come. Market's concerned that this is as good as it gets -- revenues decelerate, margins decline, market matures, new competitors enter. How long can you possibly maintain 55% net margins?
Still, street remains bullish with a $300 price target.
Not invested right now, as it's very hard to justify upside to earnings from analysts' estimates. Stock's cheap, so not bad from risk/reward. On the flipside, when the market sells off it has very good valuation support because the multiple's so low. Some upside, with pretty decent downside protection.
But other stocks have much more significant earnings upside. Not the pick for outsized performance.
The de facto place to go to take advantage of the AI revolution. Whether this continues is a very difficult question. Competition is starting to creep up, but remains to be seen whether they can do anything of scale. He'd be surprised if NVDA's economics are the same 5 years from now.
Be careful, as you're betting on fund flow dynamics around AI. Investors might consider it time to move to the next layer of investments that can benefit from AI (and are more predictable than chip economics several years from now).
He just bought more on this dip. The valuation is lower, cheaper. Strong revenues and cash flow and share buy backs. It's only the second time he's been able to add to it. Is comfortable buying below $200. Is an investment, not a trade. Demand continues to outpace supply, and the Blackwell is ramping up faster than any product in history.
Kevin SimpsonThey've been in the sweet spot of semis. They will continue to benefit from the capex spend by the hyperscalers. But others can compete better like AMD. NVDA's lead protects them, though. Smart CEO. NVDA will be volatile.
Paul Harris, CFAFrom a value point of view, NVDA sticks out as cheaper (~22x PE) in the space. But he's been reducing his exposure to the sector. The capex isn't slowing down anytime soon. When the music stops on this, you have to be really wary. Cyclical. Very cautious on semis.
Continues to buy for new clients (he uses RSI to pinpoint an entry point that will deliver value). Beneficiary of the AI capex tailwind. For him, remains the toll road of the AI buildout.
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Premium contentWe reiterate NVDA as a TOP PICK. Whether it is robotics, self-driving vehicles or new data centres, their chips are central to growth in these and many other sectors. It trades at 37x earnings and supports an amazing ROE of 97%. Cash reserves are at the highest levels in at least 5 years and the company continues to aggressively buy back shares. We continue to recommend a stop at $182, looking to achieve $263 -- upside potential of 28%. Yield 0%
(Analysts’ price target is $303.71)
His favourites right now are AMZN, NVDA, and MSFT. They're all going higher.
On the capex spend, sometimes it's a leap of faith. You're relying on these companies having some of the smartest people in the world with the most disposable capital. And those people really believe it's not a bridge to nowhere.
Undoubtedly, some companies are overdoing it and there will be another side to the mountain. But we don't know when that will be.
Premium contentIn the last quarter, the company reported 1.87 USD per share, beating the 1.75 USD estimate by 6.52%. Revenue for the same period reached 81.61 B USD, despite the estimate of 78.91 B USD. For the next quarter, analysts expect 2.03 USD in earnings per share and 90.21 B USD in revenue. Social media mentions are up 126% in the past 24h.
Chart shows staircase consolidations and rallies. Earnings days are a total black box for him, no idea what's going to happen today (coin toss). We'll either see a corrective phase back to support, or see another push higher.
Longer-term chart continues to work. He'd look to add on weakness -- either right away if there's a drop, or later in July/August if the stock moves higher in the short term.
It's interesting that TSM makes NVDA chips, and MU memory goes into NVDA chips. All part of the same value chain. NVDA is at bleeding edge of technology, no direct competitor in the conventional sense. If AI is real, NVDA is the winner. And if we're not at peak capex, NVDA is the winner.
He's adding in all these caveats because the valuation's OK, but you have to believe that revenue from here and 2.5 years from now is going to double. Is that likely? He thinks it's more of a 50/50 bet.
As an investor, you should look at whether you think MSFT Copilot is going to be successful, and will it have 10-30M subs willing to subscribe? If yes, then the killer app for AI is here, and NVDA will continue to rally.
He's more neutral on NVDA today, and still owns it today, but has been trimming as capex risks starting to build up. Cost of admission to NVDA is +/- 30% at the very least. He's not chasing the recent 15% dip. Worth owning over a 3-5 year horizon, but be mindful that you can't double or triple up the weight right now by adding on tertiary AI stocks that are associated with it.
Own it, but own it in a size that you'd be willing to tolerate big, significant drawdowns and moves higher. Believe in it, but don't be over-invested.