NVDA Stock Forecast and Analysis: 3 opportunities and 2 risks

What are the 3 opportunities and 2 risks for NVIDIA? How to invest in NVIDIA stock? NVIDIA(NVDA) stock buy or sell？

NVIDIA Stock Forecast and Analysis 2021

First, because in the third quarter of 2020, NVIDIA's revenue and profit have set record highs. Among them, revenue was 4.73 billion U.S. dollars, an increase of 57% year-on-year, and analysts expected it to be 4.41 billion U.S. dollars.

NVIDIA's revenue

Earnings per share were 2.91 US dollars, analysts expected to be 2.57 US dollars. It can be seen that both revenue and profit have exceeded analysts’ expectations.

NVIDIA expects its fourth-quarter revenue to be US$4.8 billion, in line with analysts’ expectations of US$4.42 billion.

Second, the current market value of NVIDIA is much higher than the combined market value of Intel and AMD.

From the beginning of the year to now, NVIDIA has risen by 123%, AMD has risen by 87%, Intel has fallen by 24%, TSMC has risen by 64%, and the Nasdaq has risen by 33%.

It can be seen that both in chip stocks and technology stocks, NVIDIA has risen rapidly

Does NVIDIA have room for growth? This is the question that every investor thinks about every day

For NVIDIA, a high-tech company with high growth, high valuation, high risk, and high return, pure analysis of financial indicators is no longer valid.

If NVIDIA cannot continue to grow in the future, it cannot maintain its current high valuation.

As investors, we must capture the possible future opportunities and risks from the macro perspective of the entire chip industry ecosystem and technological development.

Today we will focus on the events and developments of the chip industry in the past six months, talk about the three opportunities for NVIDIA, and focus on two potential risks.

Nvidia stock target value

Let’s talk about the three major opportunities for NVIDIA’s future development.

Opportunity 1: The epidemic caused people to stay at home, and unexpectedly caused explosive growth in the game industry.

In 2020, the global video game market is expected to reach 159 billion U.S. dollars, which is about 4 times the movie box office revenue and 3 times the music industry revenue.

Games have very high requirements for computer graphics cards. The development of the game industry has stimulated a surge in graphics card sales. NVIDIA currently has 70% of the GPU market.

It is foreseeable that the improvement of the epidemic will not happen overnight. If the epidemic persists for a long time, the game industry will continue to benefit, and NVIDIA will also benefit in the long term.

Opportunity 2: With the explosion of artificial intelligence, NVIDIA with GPU technology has greatly benefited.

At present, the main application areas of artificial intelligence include fingerprint recognition, speech recognition, image recognition, video recognition, deep learning, intelligent robots, etc.

GPU is more suitable for artificial intelligence than traditional CPU because GPU is more suitable for matrix operation, the neural network is designed for a large number of matrix operations, so it is better to use GPU than CPU

Opportunity 3: GPU is promising in the future for autonomous driving technology.

Computing power is the key to autonomous driving, including the processing, fusion, and calculation of perceptual information.

At the same time, decision-making is deep learning. NVIDIA’s GPU is by nature the best choice for autonomous driving computing platforms.

In summary, games, artificial intelligence, and autonomous driving are all industries with great growth potential in the future, and NVIDIA's GPUs have incomparable technical advantages in these industries.

These are the driving forces that have driven NVIDIA to catch up with Intel in the past few years. I firmly believe that it will continue in the future.

Ordinary people always think that the risk NVIDIA faces is the competition between Intel and AMD. NVIDIA’s biggest risk does not peer competition, but the changes and adjustments of the entire chip industry ecosystem.

These are the most difficult risks for NVIDIA to resist.

The 2 risks faced by NVIDIA are:

Risk 1: Apple started to use self-developed laptop SOC (system chip), which may become a trend,

Apple’s just-released M1 chip is Apple’s first self-developed ARM architecture processor for Mac. The first devices using this processor include MacBook Air, 13-inch MacBook Pro, and Mac mini.

Not only the CPU, but the GPU is also integrated,

Apple’s self-developed notebook computer chips are not only hitting Intel, but NVIDIA and AMD are also hit hard.

If Apple’s market share in notebook computers is greatly increased due to the success of self-developed chips, it will squeeze NVIDIA’s GPU market share in notebook computers.

Risk 2: In data centers, undeveloped chips will become more and more common.

Two years ago, Amazon has launched the first self-developed Arm architecture cloud server CPU-Graviton, and the first cloud AI inference chip AWS-Inferential, trying to take its path of cloud core integration

Huawei has also accelerated the pace of self-developed data center chips. Huawei’s TaiShan servers, including Kunpeng 920 and Shengteng 310, are bringing high-performance computing into every data center.

And Microsoft is trying to make FPGA and CPU work together to replace GPU,

Because FPGA has pipeline parallelism and data parallelism at the same time, while GPU has almost only data parallelism,

As early as 2016, at the Google I/O Developer Conference, Google officially released the first generation of TPU. Up to now, Google’s self-developed artificial intelligence chip TPU has been iterated to the third generation.

Since 2017, Alibaba has successively invested in Cambrian and acquired Zhongtianwei.

Nvidia stock price

Why will self-developed chips for data centers become a major trend?

Because of the great development of the public clouds, these public cloud operators have an increasing market share. They have their technical strength from researching their chips and developing their software, rather than relying on traditional chip manufacturers.

Therefore, the more cloud computing develops, the more obvious the trend of self-made chips in the data center in the future. This is not a good sign for traditional chip design companies such as Intel, AMD, and NVIDIA.

From a macro perspective, we analyzed 3 big opportunities and 2 potential risks for NVIDIA.

These three big opportunities have opened upmarket development space. NVIDIA, which has the absolute advantage of GPU technology, will still have a lot of room for growth in the next few years. It is believed that the stock price will also rise.

At the same time, these two risks must not be ignored. The chip industry is changing rapidly, especially when these two risks are driven by major companies such as Apple, Amazon, Microsoft, and Alibaba.

Some of them are large customers that NVIDIA depends on. They have the resources to create and change the landscape of an industry. Today I will not analyze the short-term trend of NVIDIA stock.

As investors, when conducting NVIDIA Stock Forecast and Analysis, we must pay attention to these major trends to make the right investment decisions for NVIDIA at the right time.

Related articles

January 22, 2021: TSMC VS Nvidia, AMD, Intel. How to choose semiconductor stocks?

Comments

Gold(GLD) and crude oil(USO) plunge and lose their value?

Recently, the stock market has experienced ups and downs. During the financial crisis, gold, bonds, and even bitcoin, which have been regarded as value-preserving, have depreciated. Can't help but make many investors confused, why is it like this? gold Gold On February 24, due to the stock market crash, a large number of institutions sold gold to make up for the losses of these institutions in the stock market and to increase margin. The price of gold resumed its rise in early March and then fell to a lower level again on March 9. Many investors were confused. Should n’t gold be a hedge? Should n’t gold and the stock market rise in the opposite direction? All of this has nothing to do with the shortage of funds in the repo market. The Fed ’s bailout ceiling is far from enough, and then the Fed issued an emergency statement on March 12. "Starting on March 12, 500 billion bailouts will be provided. Tomorrow the Fed will provide another 500 billion three-month repurchase...

The era of negative US interest rates coming?

Recently, the US Federal Reserve suddenly cut interest rates and US stocks fell sharply. Most investors believe that the ten-year bull market for US stocks has ended. In terms of the US dollar index, after a period of decline, the US dollar index rebounded sharply, indicating that risk aversion was high, and market funds were flowing to the US dollar to hedge. The Fed ’s interest rate cuts have not saved the US stock market. The Fed ’s interest rates are now very low. If the Fed continues to cut interest rates in the future, the United States will soon enter the era of negative interest rates. Take Europe and Japan as examples. Negative interest rates have not restored the country ’s economy. The future economic situation of the United States is not optimistic. The reason for the negative interest rate is that the investment must be profitable, otherwise, it will not be invested. If the profit is low or loss, the investor will directly deposit the profit to the bank. When socia...

The signal that the stock market has peaked?

the stock market Although I know how to judge when the bear market is over and when I should buy at the bottom, I still don't know how to judge the selling at the top. I'm afraid I don't know when to leave the market after buying stocks in the future. If you have also tried to avoid the crash, stock market crash, and even bear market, or always hold stocks at these times. These four tricks are based on my experience in the stock market for more than 10 years. They help me hold cash early before many market declines, so I suggest that you must see the end. It is likely to help you invest in stocks. Raise to another level. Because knowing how to go is more important than knowing how to buy, and knowing how to go is an important factor in determining how much you can earn or lose. The first trick, everyone needs to learn to identify the Distribution Day. As the name implies, the shipping day is a day of huge selling pressure. On that day, it may be that large account...

Will China's economy recover as the epidemic is under control?

During the Chinese Spring Festival, novel coronavirus broke out in Wuhan, and the Chinese stock market was hit hard. Subsequently, the Chinese government quickly took strict measures to block Wuhan, a city with a population of tens of thousands of people, to prevent the further spread of the epidemic, and to take corresponding epidemic prevention measures in other cities. When the worst of the epidemic had already occurred, the Chinese stock market quickly rebounded. As the number of infections continues to decline, China's Shanghai Composite Index is expected to rise further. Sars Period Looking back on similar events in the past, the SARS epidemic in 2003, the stock market also made a short-term decline, and then the SARS epidemic was brought under control, the stock market immediately went up for a long time. According to past historical data, the impact of the novel coronavirus epidemic on the stock market may be short-lived. China Fund Capital Flow Howeve...

Three stages of bull and bear markets!

The bull and bear markets of the stock market are traditional indicators of the business cycle. As an investor, distinguishing bull and bear markets in the stock market and grasping the long-term development direction of the market can avoid the impact of short-term market fluctuations and the impact of complex market information. For example, the market fluctuations brought by news information, the sudden and sharp drop in market prices, and the impact of investor sentiment have led to making wrong investment trading decisions. The stock market is in a bull market, most asset prices will continue to rise, and the stock market is in a bear market, most asset prices will continue to fall. Both bull and bear markets are divided into three stages, so how to tell whether the stock market is in a bull or bear market, and at what stage. S&P500 Index What is a bull market? In the first stage of the bull market, after the market economy was in recession, the stock price fe...

Will the Great Depression make a comeback?

the Great Depression On March 21, 2020, the United States already had initial unemployment data. Exceeding market expectations, the number of applicants reached 3.28 million, a record high. The current unemployment situation in the United States. Before March 7, employment in the United States was not affected by the epidemic. In the week of March 7, the number of people applying for unemployment benefits for the first time in the United States was 211,000, a decrease of 4,000 compared to the previous week. It is still healthy. This shows that the United States is in a good employment track range. The actual data began to fluctuate, that is, the data for the week of March 14, the number of people applying for relief reached 282,000, a slight increase. On March 21, the number of people applying for unemployment benefits soared to a record high this week. 1.7 million people have far exceeded expectations, and market expectations are about 1.5 to 1.7 million people. It can be said...

Bear market coming, gold(GLD) assets become essential

The economic data of the global economic powers have been deteriorating, entering the bear market stage of the economy, and people have become more cautious when choosing asset investment. We should choose investment products with a low correlation coefficient with economic performance and investment products suitable for the current economic cycle. Investors should pay more attention to foreign exchange and commodity markets so that they can add value to your assets. Among many assets, anti-inflation commodities such as gold have become essential assets. Take gold as an example. For many years, gold has been regarded as an anti-inflation commodity by international capital markets and has been regarded as an important asset hedging tool by investors. There is also a saying, "The world bought gold during turbulent times." From basic political theory, we know that gold is not currency, and the currency is naturally gold and silver. Although gold has withdrawn from ...

How to judge the market entry signal?

buy sell Most people lose money when investing in stocks. One of the biggest reasons is that they buy stocks at the wrong time. Why did they buy the stock at the wrong time? Facts have proved that many people do not know that stocks only rise 1/4 times, and that is the easiest time to make money. And in another 3/4 of the time, making money is difficult, and losing money is easier. Today, I will share how to choose the right time to buy stocks. I hope you can see the final result because, in the end, I will share with you how to use simple technical indicators to help us find the exact input time. First of all, everyone must know a concept, whether it is a stock market or a stock, there are four stages. Let us take the stock market as an example. The first stage is called the "next stage". At this time, the market has just experienced a sharp decline, and most investors in the market are not interested in the stock market, because their memories are still stuck in t...

Safe-haven assets（GLD） are flowing into the market?

On March 9, 2020, the US Dow Jones Index plunged more than 2,000 points, the U.S. stock market crashed, the investment market was full of fear, and market funds flowed into those safe-haven assets? With the spread of the epidemic, the market's risk aversion has continued to increase, and the stock market has continued to fall. As an investor, to reduce investment risks, you must buy safe-haven assets, reduce the purchase or sale of assets in the stock market, and avoid a sharp decline in the stock market, which will cause serious losses. When market risks continue to increase, investors will continue to buy safe-haven assets. Investors should pay attention to the following several safe-haven assets and use them as safe-havens. Dow Jones Index The first safe-haven asset is gold. Gold（GLD）, as a traditional anti-inflation commodity, has always been the preferred safe-haven asset for investors. GLD The second safe-haven asset is the Japanese yen. Because the Japanese y...

Many companies will China close in 2020?

Starting in March, all walks of life in China began to resume work. People stayed at home for more than two months. Many people's moods changed from tension to leisure, and now they are anxious. It's not just the bosses who are anxious. Many employees find that their rents and mortgages are still being paid, the holidays are extended, they can't go to work, and their salaries aren't. Whenever there is no money it is a big problem. More than 700 companies closed down in February, but getting fewer wages is also better than the company suddenly closing down. In February, more than 700 companies have closed down, and this number should be exceeded. Statistics show that more than 55% of catering businesses in China have resumed work, but compared to the same period last year, affected by the epidemic, 78% of catering companies have lost more than 100% of their operating income, and another 16% of them have lost over 70%. This year's sudden outbreak, the impact...

FinanceLinkway

Search This Blog