NVIDIA Stock Slips Ahead of Earnings: Will it Surge or Crash?

Key Insights

• NVIDIA stock price pulled back from its all-time high.
• The company will publish its financial results on Wednesday this week.
• Analysts are upbeat that it will beat its estimate and boost its guidance.

NVIDIA stock price has pulled back from its all-time high as traders position for the upcoming corporate earnings. This will provide more information about its business.

NVDA stock dropped to $228 from the year-to-date high of $236. So, will the stock continue falling or rebound this week?

Traders Bet NVIDIA Will Beat Its Revenue and Earnings

Polymarket traders are betting that NVIDIA’s earnings will be stronger than expected. A poll with nearly $20,000 shows that the odds that its numbers will be better stand at 97%.

Analysts tracking the company predict strong results. Recent numbers from top competitors and clients support this view. For example, Intel and Advanced Micro Devices (AMD) showed that demand for semiconductors continued rising in the first quarter.

Top clients like Microsoft, Google, and Amazon continued growing their capital spending in the first quarter. This growth particularly boosted the data center industry. They even boosted their planned spending plans for the year to a combined $725 billion.

Analysts estimate NVIDIA’s revenue will reach nearly $80 billion. Goldman Sachs analysts predict the company will beat this figure by $2 billion. Also, analysts expect that the earnings per share (EPS) will grow by over 128%.

NVIDIA Stock Guidance Set to Drive Momentum

The upcoming results will be important for the company. However, guidance will serve as the main driver for the NVDA stock price. In its last earnings report, the company hinted that its annual revenue will be over $376 billion this year.

Now, there is a possibility that the company will boost its guidance for several important reasons. For example, NVIDIA purposefully avoided adding Chinese business to its guidance.

Now, the company will provide its comprehensive forward guidance while incorporating China. There, the Trump administration agreed to allow ten of the biggest companies in the country to buy the H200 chips. Some of the most notable ones are companies like Alibaba, Tencent, and JD.com.

The upcoming guidance will also include Vera, its recently announced CPUs. That will make it a direct competitor to companies like AMD and Intel.

Analysts Believe That NVIDIA Stock is a Bargain

Most analysts tracking the company believe it has become a bargain. This sentiment persists even though the stock trades near a record high. As a result, the average estimate among analysts is that the stock will jump to $274, 22% above the current level. The estimate was $164 12 months ago.

C.J Muse, a top analyst from Cantor Fitzgerald, is the most optimistic, with a target price of $350. Other optimistic analysts represent firms like Cowen, Royal Bank of Canada (RBC), and UBS. Experts from Susquehanna and Goldman Sachs also share this positive outlook.

The view is that the company is trading at a forward price-to-earnings ratio of 23. It’s much lower than that of the popular semiconductor ETFs like SOXX and SMH. Also, the company has one of the best Rule-of-40 multiple. That’s calculated by adding its revenue growth to the profit margins.

NVDA Stock Price Technical Analysis

The daily chart shows that the NVDA stock price soared and peaked at a record high of $236. It then pulled back to the current $228 as some investors started to book profits.

On the positive side, the stock remains above the key support level of $212. This level marks the upper boundary of a cup-and-handle pattern, which typically signals a bullish continuation.

The stock remains above the 50-day and 100-day Exponential Moving Averages (EMA), a sign that bulls remain in control.

The most likely NVIDIA stock price forecast remains bullish. Analysts eye the psychological level of $250 as the next key target.

However, another scenario is where the stock drops and retests the key support at $212. This price action is known as a break-and-retest pattern, which is a common bullish continuation pattern.

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