NVIDIA Corporation (NVDA)

It better! This name is the poster child for the AI revolution, and will reflect demand in that whole area. He's not that concerned about NVDA. Its product is completely sold out for the next 12 months. He shaved a bit when it was up around $140-145, and he bought some just recently. His position is now 5-6%.

Well-known to sandbag earnings and revenue. The most important part will be its forward guidance on demand for GPUs, the Hopper, and Blackwell chips. It's a big day.

Loves this stock. Coincidence that it's also reporting today. Thinks revenue will be slightly above what was guided. Invested in so many businesses from having made so much money. GPUs, professional visualization, automated driving, AI deployment and data centres. 12-month target of $175. Yield is 0.03%.

He thinks NVDA will move 10% to the upside, and yes this is a pivotal moment. It's hard to see demand falling off. It trades at 30x forward PE with net income growth and EPS growth over 100% YOY, with forward projections up 50%. At 30x forward PE and that projection, NVDA is very attractive. True, stocks can always go done, and in the past quarters, NVDA announces fabulous earnings and the stock has gone down. So, how NVDA trades tomorrow and Friday doesn't matter. Given this valuation and insatiable demand, he'll take that 10% higher.

A fine company with a stock that has wilted, though still +9% so far this month. If it keeps delivering (with earnings on Wednesday), then it won't part of the frothy trade now. Own it, don't trade it, but don't have any expectations for this quarter.

It reports Wednesday, perhaps the most important company to do so this year. All semis stocks sold off today. He keeps saying: own this, don't trade it, but his strength may be tested by the possibility of a slow ramp in its Blackwell platform launch. He expects the CEO to offer a clear path.

She bought it. The stock was in a decline, though recently come back off its high, so she entered. Also, companies are spending $100 billion on AI, much will go towards NVDA chips that will remain dominant.

A brilliant company, but the PE is very high. If it missed or gave soft guidance, it will be severely punished. Wait after earnings if it dips. Too pricey for him. It fluctuates a lot.

Sold off on DeepSeek news. He owns TSM instead. Because it designs chips, NVDA is more of a software company than TSM. His worry is that hyperscalers are looking to design their own chips. Rich valuation compared to cashflow.

Buying back tons of stock, which helps drive earnings growth. If your heart's set on it, be patient, wait for a pullback, don't chase.

Sell calls at $150 May to get $7.60. 

Fantastic earnings growth. Just bounced off 200-day MA (a good support level), and that's where he added recently. Paying about 32x forward PE for 35% expected growth, so the PEG ratio is reasonable. 

DeepSeek news concerned some investors, but does it make the products that NVDA does with the same broad customer base? Have to see over coming quarters and years.

His team's fundamental analyst likes it a lot, with a strong buy. Bottomed in 2023, then an uptrend, now has been basing over the last couple of months. With Monday's DeepSeek volatility, it tested its key 40-week MA. It's chopping around that level now.

If it remains above that level, the medium-term trend is up. You can nibble here, but he'd prefer it to come back up and take out recent highs and on strength. If we get a multi-week close below that level, strongly suggests a bigger corrective phase. Off the top of his head, the next support level is around $90 or $94.

Investing is tough, and when a group of university students came visiting his shop, and they all put their hypothetical $$ to work in NVDA, that has him very concerned.

There are two scenarios after DeepSeek rocked the tech world earlier this week. One is that DeepSeek requires fewer computer chips to do the job, therefore eroding demand for NVDA's chips and decreasing their revenues. So, NVDA shares are overpriced and will decline. The other story is that maybe we're not getting the full story, that maybe the cost of developing DeepSeek was a lot more than publicized, and may been subsidized by the Chinese government. Independent research company, SemiAnalysis, questions the official cost and pegs it as much higher. If the facts are not true, selling NVDA this week was a mistake. Consider that Meta's Zuckerberg, Elon Musk and Oracle are paying full price for their huge orders for NVDA's chips and that they must have done their due diligence before ordering those chips. They must have known about DeepSeek already. He thinks the Semianalysis story is spot on.

There are two scenarios after DeepSeek rocked the tech world earlier this week. One is that DeepSeek requires fewer computer chips to do the job, therefore eroding demand for NVDA's chips and decreasing their revenues. So, NVDA shares are overpriced and will decline. The other story is that maybe we're not getting the full story, that maybe the cost of developing DeepSeek was a lot more than publicized, and may been subsidized by the Chinese government. Independent research company, SemiAnalysis, questions the official cost. If the facts are not true, selling NVDA this week was a mistake. Consider that Meta's Zuckerberg, Elon Musk and Oracle are paying full price for their huge orders for NVDA's chips and that they must have done their due diligence before ordering those chips. They must have known about DeepSeek already. He thinks the Semianalysis story is spot on.

(Stock split June 10, 2024) Still in the top 10 in his fund. Imagines that the Blackwell chips may take a bit of a back seat to the Hopper chips. His 12-month target is $175. Some Wall Street analysts have brought their targets down, but none are below $155, so still a very decent runway.
 
Still has a monopoly on the accelerator chips. Still a must-have in a portfolio. Companies involved in the large-language models, like META and GOOG, will continue to buy the Blackwell chips.