Nvidia's Earnings Impact on Your Portfolio
Tech giant's earnings and market impact.
Big Tech Impact: How Nvidia's Earnings Could Make Or Break Your Portfolio
Chipmaker Nvidia's upcoming earnings report could make or break your tech-heavy portfolio. But are cracks already emerging in Big Tech's armor?
Nvidia's Stock Has Had a Wild Ride So Far in 2024
Chip maker Nvidia's stock price has gone on quite a ride so far in 2024. The share price has shot up over 40%. This is because investors got very excited about Nvidia's work in artificial intelligence or AI. But on Tuesday, the stock suddenly dropped 5%.
This happened because Nvidia will announce how much money it made last quarter next Wednesday. Investors are worried the company might not make as much money as expected.
Nvidia has beaten expectations and made way more money than forecast for many quarters in a row now. But its stock price has gotten so high that investors worry Nvidia may need to totally blow away expectations again. The average guess is Nvidia will say it earned $4.56 per share last quarter.
And that it brought in $20.378 billion in sales. If true, that would be growth of 422% in earnings per share and 236% in revenue compared to a year ago.
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What's at Stake in Nvidia's Report
The stakes are high for Nvidia's earnings announcement. Nvidia is now the third most valuable public company in the U.S. If it does not meet expectations, it could bring down the overall stock market. That's because Nvidia makes up a big part of major stock indexes. With a market value of $1.79 trillion, Nvidia is bigger than companies like Johnson & Johnson, Tesla, and Berkshire Hathaway.
But if Nvidia beats expectations again, it would support the view that stocks will keep rising this year. It would also let Nvidia's stock price climb higher. Nvidia has been one of the top performing tech stocks over the past year. While the S&P 500 is up 10% over the past 12 months, Nvidia's stock has skyrocketed 224% in that time.
Nvidia's Tech Focus Aligns with Bipartisan Goals
Nvidia's work in AI, data centers, and new technologies fits with bipartisan efforts to compete with China. Nvidia's chips power AI systems used by companies, governments, and researchers across industries. Both Republicans and Democrats want to see U.S. leadership in strategic fields like AI.
Nvidia's success helps make the U.S. more competitive versus other countries. Investing in companies at the forefront of innovation has been a priority for both parties. So as one of the hottest tech stocks, Nvidia offers investors strong growth potential.
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Staying the Course Through Uncertainty
While Nvidia's upcoming report brings uncertainty, long-term investors focused on innovation, growth, and American competitiveness have reason to stay optimistic. Market volatility is inevitable, but Nvidia remains a leader in strategic technologies the country needs.
Short-term price swings can't obscure the fact that Nvidia sits at the forefront of AI, an area critical to future economic strength. Its chips power technologies molding our world for the better. Remember, behind the numbers are scientists pushing boundaries.
Leaders like Nvidia propel progress when supported, as many in both parties recognize. With eyes on the horizon, not just quarterly returns, investors can find companies building the future. The path is never smooth, but sticking to sound principles provides the steadiest gait.
Through the unknown road ahead, faith in American ingenuity lights the way. If North Star values guide our steps, the journey need not trouble our hearts.
To the future of our America,
James Reagan