NVIDIA Corporation (NVDA)

Own, don't trade it. They just beat earnings fuelled by higher sales. Stunning revenues.

Very expensive stock, but demand for products strong.
Growth expected to continue.
Cyclical business - hard to predict future.
Will continue to watch. 

All these new price target are not based on any news, just pure momentum. Every additional point in its share prices makes its Wednesday report more problematic. If they don't smash these estimates and targets, there will be a problem. Own, don't trade it, if shares fall.

It's the most expensive stock now at 40x trailing 12-month sales. Yes, the stock is higher this year, but the fundamentals have made a quantum leap forward. If they execute, the price will be justified. But he can't say to jump into right now. The opportunity is in data centres; they had 6% of it and will probably get 30%. But they have to deliver.

He reiterates his long-term faith in Nvidia, which he has owned a long time. No, he won't advise on whether to buy or not before NVDA announces its next quarter. He's not a trader and no longer a hedge-fund manager. He buys long-term if he believes in a company. He will look at the results of the quarter, but will also see if the underlying fundamentals remain strong. If you can't handle the volatility, don't own this name. No one comes close to Nvidia in AI.

Current pullback in share price a good time to buy.
Expecting great Q4 results.
Momentum in company stock price is also in its favor.
Beneficiary of A.I. tailwinds. 
Earnings expectations are going to get even better. 
Currently very difficult to get chips made by company. 

TSM makes the chips, whereas NVDA designs them. Semiconductors have become very political between China and the US.

TSM is going to have large capex over the next little while, as they build new plants. A great business over the last several years. Issues are more political. Incredibly well run. Largest foundry in the world.

NVDA has been in the sweet spot of semis. Has done very well, especially AI products. In high demand, leading edge. Earnings come out soon. Run up a lot. Wait for a pullback.

The chart is close to a peak (maybe a little more upside), then will pull back for a couple months. Be careful here.

She bought more Nvidia. She loves earning season. What she learned from conference calls from Microsoft, Meta et al is that they're building a ton in AI capex. She doesn't know which companies will monetize at this point, except Nvidia. All roads lead to Nvidia. She's confident that they will report a backlog next month and will raise guidance.

On fire. AI frenzy has pushed these stocks on price and valuation. Trades at 45x trailing price to sales, 23.6x forward price to sales. Growing quickly, future looks bright, but the valuation is unheard of. There's momentum, so you can hold, but keep an eye on it. He'd prefer names with similar growth rates, but much better valuation. See his Top Picks.

Whether to buy now is a tough question, but he's been adding recently. Great story. Dominant in GPU space, and you need GPUs for AI. Earnings quarter was one of the best he's ever seen, yet still earnings growth estimates got ratcheted up. Valuation is reasonable given EPS growth rate of over 40%.

The gains have been so incredible that she has taken some profits. It's a tremendous data play and just in AI.

He still strongly believes in these names, but Palo Alto is up 76% YTD while Nvdia is 189%. He just took profits to be prudent and manage risk. Still believes in AI and cybersecurity. Palo has achieved profitability with EPS growth above 85% and revenue growth is 25%. 

Two directors have sold a large $$ amount of stock (about $80M combined). Certainly after a 200% gain many will take some profits. While there is plenty of AI hype, we do think this year will be a very big 'spending' year on AI. It may be a year from now before companies decide if the spending was 'worth it'. We like positive momentum and earnings surprises, but no one can say NVDA is cheap. We still think it can be owned, but we would monitor position sizes, and 'traders' might get a chance to re-buy. It is not going to go up in a straight line, certainly. 
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