Nvidia’s GPU sales finally ‘normalize’ after its crypto-mining craze

Yolanda Curtis
August 18, 2019

NVIDIA Corporation (NASDAQ:NVDA) reported stronger-than-expected results for its second quarter.

To be fair to Nvidia, their CEO's statement is not entirely just marketing as it is indeed true that a lot of people buy a graphics card for around 2-4 years of gaming.

The chipmaker said it expected third-quarter revenues in the range of $2.842 billion to $2.958 billion, below estimates from S&P Capital IQ Consensus of $2.98 billion, with margins expected to be in the range of 62% to 63%. For the last quarter, the company posted a quarterly EPS of 1.24.

Taking a step back from the sequential results, the "new normal" for Nvidia seems to be significantly lower revenues compared to past year. NVDA's total short interest was 9.84 million shares in August as published by FINRA. Fmr Llc who had been investing in Nvidia Corp for a number of months, seems to be bullish on the $90.60 billion market cap company.

Now the return on equity is 35.30% and its debt to equity is 0.00. Shifting to the 50-day moving average vs price signal, the reading is measured at Sell. NVIDIA has a 1-year low of $124.46 and a 1-year high of $292.76. It also saw positive growth in the data center business, albeit by only 3%. That's 27% lower on an annualized basis.

The price/earnings ratio (P/E) for NVIDIA Corporation is 34.05 and the forward P/E ratio stands at 22.41. Following the transaction, the chief financial officer now owns 239,710 shares of the company's stock, valued at $39,314,837.10. The shares were sold at an average price of $145.10, for a total transaction of $14,510,000.00. The disclosure for this sale can be found here. Of course nobody wants to see a significant drop in the value of stocks that they own. Excluding items, it earned $1.24 per share, ahead of expectations of $1.15. Sound Income Strategies LLC now owns 204 shares of the computer hardware maker's stock worth $34,000 after acquiring an additional 100 shares in the last quarter. LS Investment Advisors LLC boosted its holdings in NVIDIA by 0.5% in the 1st quarter.

Institutional investors have recently bought and sold shares of the stock. Finally, Field & Main Bank purchased a new position in NVIDIA in the second quarter valued at approximately $33,000. The computer hardware maker reported $1.24 EPS for the quarter, beating analysts' consensus estimates of $0.87 by $0.37. Insiders own 4.64% of the company's stock. (NASDAQ:NVDA) by 25.2% during the 2nd quarter, according to the company in its most recent filing with the SEC. Royal Bank of Canada cut their target price on NVIDIA from $200.00 to $190.00 and set an "outperform" rating for the company in a research note on Tuesday, August 13th. Finally, UBS Group reduced their price target on shares of NVIDIA from $210.00 to $195.00 and set a "buy" rating on the stock in a research report on Friday, May 17th.

Investors may be sizing up shares of NVIDIA Corporation (NASDAQ:NVDA).

Rosenblatt reiterated a Buy rating with a $180 price target. But at the same time, the company was still recovering from two major blows. The company presently has an average rating of "Buy" and an average target price of $193.04.

NVIDIA Corp. engages in the design and manufacture of computer graphics processors, chipsets, and related multimedia software. Before that, in January, the company was forced to slash its revenue guidance due to what it said was slow adoption of its RTX architecture for graphics processing units.

Other reports by iNewsToday