Sign InNVIDIA Corporation Sees Minor Decrease in Stock Price, Potential for Future Growth
Summary
NVIDIA Corporation's stock on the NASDAQ exchange closed at $433.44 on August 17, 2023, with a slight decrease from the previous trading session, and technical indicators suggest it may hover around its 50-day moving average in the upcoming week, positioning it as a Hold for now, but investors should monitor its performance leading up to the next earnings announcement on August 23.
Overview
NVIDIA Corporation (ticker: NVDA) is a notable entity in the NASDAQ exchange. The company's last closing price, recorded on August 17, 2023, was $433.44, showing a minute decrease of 0.33% or $1.43 from the previous trading session. Throughout the day, the price fluctuated between $430.01 and $440.61. When viewed on an annual scale, the stock has experienced a vast range in performance, from a year low of $108.13 to a year high of $480.88.
The overall market capitalization for NVIDIA is $1.07 trillion, with approximately 24.70 billion shares outstanding. Attention to NVIDIA's stock is exhibited by the traded volume of 43.12 million, although this is slightly less than its average volume of 51.16 million.
Technical Analysis
Assessing technical data, NVIDIA's relative strength index (RSI14) indicates moderate performance at 36. Notably, its price has hovered around its 50-day moving average, at $432.67, and it shows a substantial increase from its 200-day moving average of $275.59. However, the negative 3-month MACD of -1.88 suggests bearish momentum. The stock's average true range (ATR) stands at 3.75, which means its price has been making moderate movements.
The technical analysis reveals a support level at $401.11, suggesting a lower bound for possible price fluctuations. The resistance level at $439.40 indicates a potential dilemma for further price increase.
Fundamental Analysis
Turning to the fundamental aspects, the earnings per share (EPS) for NVIDIA are $1.91, with a high price-to-earnings (PE) ratio of 226.93.
The discounted cash flow (DCF) sits closely to the last close price at $434.79, denoting a reasonable intrinsic valuation. The analyst community holds contrasting views on the firm's future performance, presenting a wide target range from a minimum price expectation of $133, a median of $240, up to an impressive $800 at the high end. However, the consensus price target stands notably lower at $285.20.
The analyst ratings suggest a strong inclination towards purchasing the stock, with 36 recommending "buy," 3 advising to "hold," and only 1 recommending "sell."
News Analysis
Relevant news indicates a positive outlook for NVIDIA. It is featured in the list of three most undervalued blue-chip stocks to buy in August 2023, hinting at stability and strength. Aligned with this view, analysts at various platforms have recently upgraded the stock, reflecting potential future gains. Additionally, a price prediction article suggests that the stock could reach up to $800, despite already impressive gains year to date.
Summary: Forecast and Evaluation
For the next trading day on August 18, 2023, given the current technical indicators, the stock may hover around the 50-day moving average price, which is slightly below the last close price at $432.67. Considering no radical market changes, the stock might stay within a similar pricing corridor for the upcoming week.
Given the above analysis, positioning NVIDIA as a "Hold" seems fitting. Despite the high PE ratio and declining MACD, the news sentiment is clearly positive. Furthermore, the stock is currently trading around both the DCF value and its 50-day moving average, suggesting a fair valuation. However, as the next earnings announcement approaches on August 23, 2023, investors are suggested to keep an attentive eye on NVIDIA's performance. Depending on the reported earnings and potential future projections, the stock might sway towards a 'Buy' or remain a 'Hold'. As such, this conclusion should be reviewed periodically.
