NVIDIA Corporation (NVDA): A Gold Mine for Growth Investors

The number of NVIDIA Corporation (NASDAQ:NVDA) shares shorted has climbed by 437,700 shares. When looking at a stock for a potential investment, you want to know what percentage of Wall Street is betting against you. That’s what short interest tells you. The most recent short interest data has been released for the December 31st settlement date, which shows a increase in total short interest for NVDA, to 18,408,484, a surge of 2.44% since December 14th. Average daily volume for NVIDIA Corporation at the December 31st settlement plunged to 16,190,814, as compared to 16,597,491 at the December 14th report. That brought days to cover to 1.136971, a 5.01% increase from the 1.082741 days to cover recorded at the prior short interest data release. Looking at the experts’ opinion for the NVDA stock we see that the average analyst recommendations at 2.1 suggests buying these shares.

NVIDIA Corporation (NVDA) will probably climb 52.9 percent over the next 12 months, according to price target estimates compiled by finviz. Meanwhile, they have set a $325-month high price target. This represents a whopping 118.37 percent increase from where shares are trading today. The 12-month median price target assigned by the analysts stands at $227.5, which represents a return potential of 52.86 percent when compared to the closing price of the stock of $148.83 on Friday, January 11. The lowest price target for the stock is $120 — slightly more than -19.37 percent from NVDA’s current share price.

The stock is currently hovering around the first support level of $144.78. Below this, the next support is placed in the zone of $140.72. Till the time, the NVDA stock trades above this level, bulls have nothing to fear. On momentum oscillators front, ‘RSI’ has touched 50.02 on daily chart, which may remain a cause for concern. If the price breaks below $140.72 level on closing basis, then we may see more profit booking and the stock may show further weakness. On the flipside, hitting the $151.32 mark may result into a pull-back move towards $153.8 level.

On 11th of January, NVIDIA Corporation (NASDAQ:NVDA) shares ended higher after a volatile session. The shares accumulated 3.6 points or 2.48 percent at $148.83 with a heavy trade volume of 21.843 million shares. After opening the session at $144.33, the shares went as high as $149.75 and as low as $143.21, the range within which the stock’s price traded throughout the day. The firm is left with a market cap of $88.6 billion and now has 595.24 million shares outstanding. NVIDIA Corporation (NVDA) stock has gained 0.43 percent of market value in 21 trading days.

NVDA stock has a trailing 3-year beta of 2.04, offering the possibility of a higher rate of return, but also posing more risk. The portion of a company’s profit allocated to each outstanding share of common stock was $7.28 a share in the trailing twelve months. The stock’s value has surged 11.48 percent year to date (YTD) against a decline of -33.46 percent in 12 month’s time. The company’s shares still trade -49.16 percent away from its 1-year high of $292.76 and 19.58 percent up from 52-week low of $124.46. The average consensus rating on the company is 2.1, on a scale where 5 equates to a unanimous sell rating. In short, the mean analyst recommendations are calling this stock a sell.

Shares of NVIDIA Corporation (NVDA) are trading at a P/E ratio of 51.91 times earnings reported for the past 12 months. The industry NVDA operates in has an average P/E of 14.37. Its P/E ratio went as low as 13.79X and as high as 43.54 over the 5-year span. Further, it is sporting a 7.13 on the Price-to-Sales ratio. Compare this with the industry average P/S of 11.59. 62.5 percent is the gross profit margin for NVIDIA Corporation and operating margin sits at 36.9 percent. Along with this, the net profit margin is 37.8 percent.

Let’s take a look at some insider activity at NVIDIA Corporation (NASDAQ:NVDA) and see the pattern. The earliest insider trade took place on 01/02/2019. Shoquist Debora parted with a total of 6.35 thousand shares of company at average share price of $135.33. The total for the sales was set at $858.67 thousand. After this transaction, the EVP, Operations account balance stood at 177.91 thousand shares. The stock grew 9.98 percent since that insider sale. On 12/14/2018, Kress Colette, EVP & CFO, sold 0.89 thousand shares at a price per share of $147.91. This removed 131.49 thousand shares from the insider’s fortune and the stock saw a 0.62 percent rally in value since the news became public. This transaction left 259.91 thousand shares in the EVP & CFO account.

On 10/02/2018, EVP, Worldwide Field Ops Puri Ajay K performed a sale transaction worth $26.28 million. This sale at $289.35 each has eliminated 90.83 thousand shares from the insider’s portfolio position. Meanwhile, shares have recorded -48.56 percent decrease since the transaction was reported. The insider now is left with 293.36 thousand shares remaining in the account. Byron Michael, who performs the Principal Accounting Officer job, sold 11.26 thousand shares for $2.97 million. The disposal occurred on 09/24/2018 was priced at $263.94 per share. The share price plunged -43.61 percent since the reporting date. Byron Michael now left with a stake of 81.41 thousand NVDA stock worth $12.12 million after the insider selling.