The Zacks Analyst Blog NVIDIA, Advanced Micro Devices, Qualcomm, Broadcom and Texas Instruments

For Immediate ReleasesChicago, IL – August 28, 2024 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: NVIDIA Corporation NVDA, Advanced Micro Devices, Inc. AMD, Qualcomm Inc. QCOM, Broadcom Inc. AVGO and Texas Instruments Inc.’s TXN.Here are highlights from Wednesday’s Analyst Blog:Should You Buy, Sell, or Hold NVIDIA Stock Before Q2 Earnings? After finishing 2023 on a high note, NVIDIA Corporation squashed bubble fears, and its shares soared 155.4% year to date, outperforming the Semiconductor - General industry’s gain of 113.8%. However, NVIDIA’s stock price faced hiccups in early August on fears that its tech customers may curtail artificial intelligence (AI) spending budgets.But NVIDIA’s shares did recover ahead of the much-awaited second-quarter fiscal earnings report that can have rippling effects on the broader tech sector. Therefore, investors are rightly contemplating whether to book profits and move on or hold on to NVIDIA’s shares for better returns in the future. Let us, thus, look at how to play NVIDIA’s shares as of now.NVIDIA’s High-Profit Margin – UnsustainableNVIDIA’s high profit margin may lead to its vulnerability soon. For first-quarter fiscal 2025, NVIDIA’s gross profit margin increased to 78.9% from 66.8% a year ago. However, sustaining such higher profit margins is difficult as demand-supply disparity will lessen in the semiconductor industry where peers are also manufacturing commendable competing products.In a competitive environment, NVIDIA would be compelled to lower the price of its products, and profit margins could take a beating. Huawei is planning to introduce its Ascend 910C chips as early as October, which can compete with NVIDIA’s H100 AI chips. Moreover, any possible trade ban on NVIDIA from selling its H20 AI chips to China may hit its profit margins.Why You Shouldn’t Sell NVIDIA StockNVIDIA benefits from tech behemoths’ spending on AI-related infrastructure. With the Federal Reserve widely expected to trim interest rates in the September policy meeting, mega-tech capital expenditure (CAPEX) spending is expected to rise, a blessing for NVIDIA.AI, anyhow, is a growing trend and not a temporary phenomenon. NVIDIA’s strong positioning in the AI field should help its shares rise. MarketsandMarkets estimated the AI industry to grow from $214.6 billion in 2024 to $1,339.1 billion by 2030.NVIDIA is also well-poised to make the most of the growing gaming market through its primary gaming graphic processing units (GPU) product line, GeForce. According to research firm Newzoo, the global gaming market will generate $187.7 billion in revenues this year. At the same time, NVIDIA is collaborating with Siemens to build an industrial metaverse, a market that is expected to reach $228.6 billion in 2029 from $28.7 billion in 2024, per MarketsandMarkets.Meanwhile, rumors regarding the production delay of NVIDIA’s Blackwell AI chips may have caused a lot of concerns. But NVIDIA recently confirmed that Blackwell sampling has begun, and the next-generation chips will be launched later this year. NVIDIA is the worldwide leader in AI chip design and software, giving the company a competitive edge over its rivals.What’s more, NVIDIA is yet again expected to post encouraging earnings for the second quarter of fiscal 2025, which may help its share prices to climb. NVIDIA is projected to report earnings per share of $0.63 for the fiscal second quarter, more than $0.27 a year ago, indicating a jump of 133.3%.NVIDIA has an average four-quarter positive earnings surprise of 18.4%, a tell-tale indication that the stock has a reasonable chance to display earnings growth in the forthcoming earnings release on Wednesday, after the bell.NVIDIA Stock is Pricey – Here’s How to Trade itDespite the positives, buying the NVIDIA stock may burn a hole in your pocket. This is because the unquenchable demand for AI models and dominance in GPUs has made the NVIDIA stock expensive.By looking at the price/earnings ratio, NVIDIA stock currently trades at 46.9X forward earnings. However, NVIDIA’s rivals such as Advanced Micro Devices, Inc., Qualcomm Inc., Broadcom Inc. and Texas Instruments Inc.’s forward earnings multiples are 44.6X, 16.9X, 33.8X and 40.7X, respectively.Hence, astute investors should wait to buy on the dips. And those who have already bought NVIDIA’s shares should hang on to it. After all, NVIDIA stock is for the long run, as AI is here to stay. NVIDIA has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks Rank #1 (Strong Buy) stocks here..Media ContactZacks Investment Research800-767-3771 ext. 9339support@zacks.com                                     https://www.zacks.com                                                Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance  for information about the performance numbers displayed in this press release.Only $1 to See All Zacks' Buys and SellsWe're not kidding.Several years ago, we shocked our members by offering them 30-day access to all our picks for the total sum of only $1. No obligation to spend another cent.Thousands have taken advantage of this opportunity. Thousands did not - they thought there must be a catch. Yes, we do have a reason. We want you to get acquainted with our portfolio services like Surprise Trader, Stocks Under $10, Technology Innovators,and more, that closed 228 positions with double- and triple-digit gains in 2023 alone.See Stocks Now >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report QUALCOMM Incorporated (QCOM): Free Stock Analysis Report Texas Instruments Incorporated (TXN): Free Stock Analysis Report Advanced Micro Devices, Inc. (AMD): Free Stock Analysis Report NVIDIA Corporation (NVDA): Free Stock Analysis Report Broadcom Inc. (AVGO): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks