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Nvidia (NVDA) Stock Sinks As Market Gains: What You Should Know

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In the latest trading session, Nvidia (NVDA) closed at $220.81, marking a -1.78% move from the previous day. This move lagged the S&P 500's daily gain of 0.15%.

Coming into today, shares of the maker of graphics chips for gaming and artificial intelligence had gained 1.88% in the past month. In that same time, the Computer and Technology sector gained 0.81%, while the S&P 500 lost 0.58%.

Wall Street will be looking for positivity from NVDA as it approaches its next earnings report date. On that day, NVDA is projected to report earnings of $1.11 per share, which would represent year-over-year growth of 52.05%. Meanwhile, our latest consensus estimate is calling for revenue of $6.83 billion, up 44.46% from the prior-year quarter.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $4.20 per share and revenue of $25.81 billion. These totals would mark changes of +68% and +54.79%, respectively, from last year.

Investors might also notice recent changes to analyst estimates for NVDA. These revisions help to show the ever-changing nature of near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Within the past 30 days, our consensus EPS projection has moved 0.08% higher. NVDA is currently sporting a Zacks Rank of #2 (Buy).

Digging into valuation, NVDA currently has a Forward P/E ratio of 53.54. For comparison, its industry has an average Forward P/E of 23.36, which means NVDA is trading at a premium to the group.

We can also see that NVDA currently has a PEG ratio of 2.74. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. Semiconductor - General stocks are, on average, holding a PEG ratio of 2.73 based on yesterday's closing prices.

The Semiconductor - General industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 55, putting it in the top 22% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow NVDA in the coming trading sessions, be sure to utilize Zacks.com.


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