Nvidia Corporation (NASDAQ: NVDA) has emerged as the ultimate powerhouse in the advancement of artificial intelligence (AI), solidifying its position as the poster child of technological innovation. With a staggering 90% surge in its stock value since the year’s inception, Nvidia’s fiscal first-quarter earnings report has sent shockwaves through the market, surpassing all expectations on both the top and bottom lines.
The company’s remarkable performance is underscored by its astronomical revenue of $26.04 billion for the quarter ended April 2024, marking an unprecedented year-over-year increase of 262.1%. Crucially, Nvidia’s data centre sales, the cornerstone of its business, soared to $22.6 billion, a remarkable 427% rise from the previous year.
Nvidia’s meteoric rise is underpinned by its unrivalled dominance, commanding over 80% of the AI chip market. This unparalleled market share, coupled with robust earnings per share (EPS) of $6.12 compared to $1.09 a year ago, underscores Nvidia’s unrivalled prowess and strategic foresight.
Moreover, the company’s bold move to increase its dividend by 150% speaks volumes about its confidence in sustaining this exponential growth trajectory. With a projected second-quarter revenue of $28 billion, surpassing analyst estimates, driven by burgeoning demand for AI chips, Nvidia’s innovation and resilience firmly position it at the forefront of technological evolution.
Technical
Nvidia’s share price has been trading in a pronounced uptrend, consistently exceeding the critical 100-day moving average. This upward momentum is further validated by the formation of an ascending channel pattern, underscoring the stock’s robust trajectory.
Following a recent downturn, the share price found solid support at the $756.06 level, coinciding with oversold conditions as indicated by the Relative Strength Index (RSI). The subsequent rebound has set Nvidia’s stock on a course towards its all-time high of $967.66 per share.
The strong fiscal first-quarter earnings have bolstered investor confidence, potentially driving further interest in the stock. If the current upside momentum persists, a breakout above the $967.66 level could signal additional gains. In such a scenario, the 23.60% Fibonacci Extension level could serve as a potential target for traders looking to capitalize on this upward movement. Conversely, if the market sentiment shifts and a downturn occurs, the $756.06 support level could act as a barrier, potentially preventing further declines.
Summary
Nvidia’s unparalleled dominance in AI and robust financial performance, highlighted by a 262.1% revenue surge to $26.04 billion, position it as a tech leader. With support at $756.06 and potential gains above $967.66, Nvidia’s innovation and strategic foresight promise sustained growth and investor confidence.
Sources: Nvidia Corporation, London Stock Exchange Group, Reuters, CNBC, TradingView
Piece Written By Nkosilathi Dube, Trive Financial Market Analyst
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