Nvidia shares hit an all-time high on Tuesday in a buildup in expectations over the quarterly results of the chip designer that has been the biggest beneficiary of a boom in artificial intelligence.
The shares eased 1.1% from a record high of $481.87 hit minutes after the market opened, crossing its previous peak of $480.88 on July 14.
Rising bets that Nvidia’s revenue target will once again surpass Wall Street estimates have lifted the stock about 19% from a two-month low hit last week.
Analysts expect Nvidia, which dominates the market for chips used to power generative AI like ChatGPT and many such services, to forecast 110% growth in third-quarter revenue to $12.50 billion when it reports results on Wednesday.
“It might be the most important report of this earnings season. We want to hear that they can build on the amazing quarter they had last quarter,” said Dennis Dick, market structure analyst at Triple D Trading.
The company had in May forecast second-quarter revenue that was more than 50% above expectations. That pushed its market capitalization above $1 trillion, making its stock the best performer on the S&P 500 index.
Nvidia’s blowout forecast last quarter had also sparked a rally in AI-stocks as well as Big Tech, making it one of the key drivers for the U.S. stocks rally this year.
“To keep the stock price where it is, we would want to see bottom line start to support those share gains,” said Brian Mulberry, client portfolio manager at Zacks Investment Management, which owns Nvidia shares.
At least 19 brokerages have this month raised their target price on Nvidia, pushing the median view to $500, which is a 6.5% increase to stock’s last closing price. Nvidia shares have more than tripled in value so far this year.
Nvidia saw the highest increase in popularity among hedge funds in the second quarter, a report from Goldman Sachs showed on Monday.
“Nvidia (and) AI story is what is driving the market right now. If Nvidia were to miss (expectations), this market would be in a world of pain,” Dick said.
Source : Reuters
The voluntary carbon market was built on a single promise: that one credit cancels one…
Macroprudential policy is designed to make the financial system safer, but it can also reshape…
Anti-immigration policies often rest on the premise that immigrants worsen native-born employment and wages. This…
Discussions on Japan’s ‘lost decades’ have long focused on sluggish demand and the survival of…
Lithium, cobalt, nickel, copper, and rare earth elements are reshaping global trade and great-power politics…
If frontier AI models can be used to develop their next models, this may lead…