NVIDIA Corporation (NVDA) will host a conference call on Tuesday, Nov. 21, at 2 p.m. PT (5 p.m. ET), to discuss its financial results for the third quarter of fiscal year 2024. (1) NVIDIA is the pioneer of GPU-accelerated computing and specializes in products and platforms for the large, growing markets of gaming, professional visualization, data centers, and automotive.
Wall Street expects the technology giant to earn $3.36 per share (EPS) with revenue hitting $16.12 billion for the quarter. Both the bottom and top lines are considerably higher than last year’s EPS of $0.58 and sales of $5.93 billion. (2)(3)
Investors might exercise caution heading into next week’s quarterly check up as NVDA shares zoomed to the top of its recent trading range. Shares jumped nearly $100 in a couple of weeks as the market rebounded on hopes of a recession and the Federal Reserve cutting rates. A move that fast and large is sure to attract profit takers with a whiff of weakness.
Clearly, based on expectations, traders are expecting blowout numbers. It’s possible that NVIDIA is priced for perfection, as they say, and anything less than grand-slam numbers and guidance could entice short term holders to cash out.
The 50-day moving average of $442.78 could be the first level of support. A complete miss and NVDA could head back to $400.00. If, on the other hand, NVDA smokes expectations and guidance, there is no telling how high the stock could go if it breaks its 52-week high of $502.66. That would put the stock into uncharted technical territory with absolutely no resistance levels above.
In cases like this, the playing field tilts heavily towards the reward side of the risk-to-reward equation. Although it’s not perfect, investors have a sense of where to find downside targets, but upside is theoretically unlimited as NVDA has never traded up there before.
Super aggressive investors might consider bullish options strategies that limit downside in the event NVDA breaks out to a new high. Of course, trading earnings and options is highly risky and only for money you can afford to lose.
1 – https://nvidianews.nvidia.com/news/nvidia-sets-conference-call-for-third-quarter-financial-results-6896799
2 – https://finance.yahoo.com/quote/NVDA/analysis?p=NVDA
3 – https://finance.yahoo.com/quote/NVDA/financials?p=NVDA