Why would anybody bet against AI-compatible graphics processing unit juggernaut Nvidia (NASDAQ:NVDA)? It’s hard to imagine the mindset of the NVDA stock short sellers, but there will always be some bears hiding in the caves. Maybe they didn’t get the memo that Nvidia’s latest round of quarterly financial results easily beat Wall Street’s forecasts.
Indeed, Nvidia’s earnings report was so positive that mega-cap stockholders breathed a collective sigh of relief. Betting against good companies is a bad idea and sensible investors will stay on the right side of the trade with Nvidia stock.
Why Did NVDA Stock Take a Rocket Ride?
To all the short sellers: you had your chance to get out. NVDA stock dipped below $700 for a few days before Feb. 22, when it zoomed 15% higher and broke above $770.
If you didn’t already get margin-called out of your short position, then listen up. The Nvidia share-price rally could continue for a while as it’s justified by Nvidia’s stellar fourth-quarter fiscal 2024 results.
Starting with the top-line results, Nvidia’s revenue grew 265% year over year to $22.1 billion. Meanwhile, analysts had expected Nvidia to have generated revenue of $20.4 billion. A particular highlight was Nvidia’s quarterly Data Center revenue, which increased 409% YOY to $18.4 billion.
Still not convinced to switch sides and join the bullish camp? Observe, then, that Nvidia reported adjusted EPS of $5.16 in Q4 FY2024, easily surpassing Wall Street’s consensus call for $4.59 per share.
While you’re at it, note that Nvidia guided for current-quarter revenue of $24 billion, plus or minus 2%. This range is squarely above the analysts’ consensus estimate of $22.2 billion.
Nvidia and Gen-AI Are at a ‘Tipping Point’
Along with Nvidia’s optimistic current-quarter revenue outlook, the company’s management offered up some confidence-boosting commentary. For instance, Nvidia Chief Financial Officer Colette Kress expects the company’s “next-generation products to be supply constrained as demand far exceeds supply.”
That’s a pretty good problem to have, you must admit. Among Nvidia’s “next-generation products” is the company’s B100 AI chip, which, per Barron’s, is “expected to be released in the coming quarters.”
Another confident quote comes from none other than Nvidia CEO Jensen Huang, who is basically a celebrity at this point. According to Huang, “Accelerated computing and generative AI have hit the tipping point.”
Is this a good “tipping point” or a bad one? Rest assured that Huang is referring to a highly positive watershed moment for AI hardware. As he clarified, “Demand is surging worldwide across companies, industries and nations.”
Nvidia Stock: Harness the Power of AI in Your Portfolio
It must be tough, betting one’s hard-earned money against a juggernaut like Nvidia. Instead of being on the wrong side of the trade, they could just switch sides and admit that Nvidia’s results are outstanding.
Then, they could consider holding a few Nvidia shares and riding the unstoppable AI trend. Resistance is futile, so we’re happy to assign NVDA stock an “A” grade along with a hearty recommendation for 2024.
On the date of publication, Louis Navellier had a long position in NVDA. Louis Navellier did not have (either directly or indirectly) any other positions in the securities mentioned in this article.
The InvestorPlace Research Staff member primarily responsible for this article did not hold (either directly or indirectly) any positions in the securities mentioned in this article.
