Sign InNVIDIA Stock Analysis: Technical Strength and Bullish Fundamentals Amid Earnings Anticipation
Summary
On May 21, 2025, NVIDIA's stock closed at $131.80 amid signs of overbought conditions and rising investor anticipation ahead of earnings, positioning it as a hold in a market marked by potential volatility and strong growth prospects.
Technical Analysis
NVIDIA (NVDA) closed at $131.80 on May 21, 2025, down 1.93% from the previous day. The intraday high of $137.40 and low of $130.60 show a relatively tight range ahead of earnings, highlighting a period of consolidation. The stock remains above its 50-day moving average ($113.68) and slightly above the 200-day moving average ($125.71), suggesting an overall bullish medium- and long-term trend. However, the RSI at 82 indicates overbought conditions, raising the risk of short-term pullbacks. The MACD remains strongly positive at 7.45, supporting continued momentum. Key technical support sits at $120.15, while resistance is near $134.83, marking the immediate trading range boundaries.
For the next trading day (May 22), the elevated RSI and recent downward price movement imply potential for limited upside or a mild retracement. Over the coming week, with earnings on May 28, price action may remain range-bound between support and resistance as investors await catalysts.
Fundamental Analysis
NVIDIA’s trailing twelve months EPS is $2.94, with a current P/E ratio at 44.83—reflective of high growth expectations embedded in the price. The discounted cash flow (DCF) valuation suggests an intrinsic value around $144.72, indicating the current price trades roughly 9% below this estimate, implying moderate undervaluation.
The company posted strong industry partnerships, evidenced by the recent collaboration with Navitas on next-generation HVDC architectures for data center power infrastructure, which aligns well with NVIDIA’s strategic positioning in AI and high-performance computing.
Consensus analyst targets remain significantly higher, with a median price target of $175 and a consensus target near $171.71, reflecting optimism about the company’s growth trajectory. Analyst sentiment is overwhelmingly positive, with 55 buys and 2 strong buys out of 75 total ratings, and only 3 sells.
Macro pressures are present, including broader market weakness tied to rising bond yields and a Nasdaq decline on May 21, which weighed on NVIDIA alongside sector peers like Broadcom.
Intrinsic Value and Long-Term Outlook
NVIDIA’s intrinsic value derived from DCF is above current pricing, indicating potential upside. The company’s dominant position in AI semiconductor chips and data center technologies supports strong long-term growth. Continued innovation, expanding AI adoption, and infrastructure upgrades provide durable revenue streams. Despite its premium valuation, NVDA’s growth potential and market leadership contribute to a compelling long-term investment profile.
Risks include valuation compression if growth slows, market volatility around earnings announcements, and macroeconomic risks such as rising interest rates.
Summary and Rating
The stock is exhibiting overbought technical conditions but remains above key moving averages, signaling sustained medium-term strength. Fundamental metrics suggest the stock is trading slightly below intrinsic value with robust growth prospects, supported by strong analyst sentiment and industry positioning. Near-term price action is likely to be range-bound leading up to earnings, with potential volatility.
NVDA qualifies as a Hold based on current data—while long-term fundamentals and intrinsic value support accumulation, short-term overextension and market uncertainty suggest waiting for post-earnings clarity before considering further action.
