Source: Glonui.
Still bullish.
After three consecutive days of decline, the stock price of NVIDIA saw a big rebound.
Overnight, NVIDIA rose 6.76% to $126.09 and continued to rise 1.74% to $128.28 after hours.
NVIDIA's market cap has returned to $3 trillion, second only to Microsoft's $3.35 trillion and Apple's $3.21 trillion, with a daily increase of $196.4 billion (about RMB 1,427 billion), equivalent to two BYD companies.
It is worth noting that on Wednesday local time (early Thursday Beijing time), NVIDIA will hold its 2024 annual shareholders meeting, where investors will vote on important issues such as executive compensation and election of board members.
Analysts predict that NVIDIA is unlikely to announce any major news at the meeting, but may take the opportunity to showcase its advantages in artificial intelligence technology.
Technical rebound after a big drop.
Last Thursday, NVIDIA's stock price hit a new high of $140.76, surpassing Microsoft and Apple in market cap, becoming the company with the largest global market cap.
Afterwards, the stock price plummeted for three consecutive trading days, falling by nearly 13% and evaporating about $430 billion in market cap.
According to data analysis company Ortex Technologies, shorts have made nearly $5 billion in profit from Nvidia's significant sell-off in the past three trading days.
Analysts believe that the sharp rise overnight may be a technical rebound after a big drop.
Daniel O'Regan, managing director of equity trading at Mizuho Securities, said that in such a large-scale sell-off of NVIDIA, the stock often rebounds on the fourth day (Tuesday) with a rebound rate of about 63%.
Tom Hayes, chairman of Great Hill Capital, said that today's rebound is a normal technical rebound after three consecutive trading days of decline, and the stock price will not plummet every day.
He also added: "This is a great company with a great CEO. When retail investors participate in stock splits, insiders sold $750 million worth of shares."
For the recent big drop, Tom Plumb, a shareholder of NVIDIA and a portfolio manager of Plumb Funds, said: "For a company that has already achieved success and gained a lot of fame, this is a normal adjustment."
He believes: "Unless there is evidence that actual business can prove that the momentum slowing down is reasonable, I don't think it has reached the historical high. "
From a technical perspective, Buff Dormeier, chief technical analyst at Kingsview Partners, pointed out that NVIDIA's short-term resistance is around $115.
Analysts believe that NVIDIA's long-term upward trend is still intact, but they are watching whether it will fall below $100.
Strategist Bruce Zaro believes that: "For stocks like NVIDIA that are in an upward trend, breaking through the first level of resistance is not a big problem, but falling below $100 is a big problem. "
Investment guru: NVIDIA is a long-term investment.
Looking ahead, analysts are generally optimistic about NVIDIA.
According to Derren Nathan, head of stock research at Hargreaves Lansdown, while Nvidia's stock price has recently fallen, people must focus on the big picture. He said: "Over the past 12 months, Nvidia has still risen 190%, so it's not surprising that some investors are taking profit." Nathan pointed out: "Although Nvidia sneezed, the overall market did not catch a cold, and the remaining stocks of the seven giants showed less extreme fluctuations in both directions." Steve Eisman, senior investment portfolio manager at global investment management firm Loomis Sayles, said he holds a "large" amount of Nvidia stock and believes it is a long-term investment that will play an important role in the coming years. "If you look at Nvidia's stock price chart, you can hardly see a pullback, so I think this (three-day decline) is meaningless." For some who question Nvidia's high valuation, Eisman said that price is the least of their concerns. "One thing I learned while running a hedge fund is that shorting a stock just because of its valuation is a dead end. Even if people think the stock price is expensive, they will still buy it because they believe in the story." As long as the story is intact, just like Nvidia's obviously complete story, the story will continue. I'm not too concerned about Nvidia's valuation."
He said: "Over the past 12 months, Nvidia has still risen 190%, so it's not surprising that some investors are taking profit."
Nathan pointed out: "Although Nvidia sneezed, the overall market did not catch a cold, and the remaining stocks of the seven giants showed less extreme fluctuations in both directions."
Steve Eisman, senior investment portfolio manager at global investment management firm Loomis Sayles, said he holds a "large" amount of Nvidia stock and believes it is a long-term investment that will play an important role in the coming years.
"If you look at Nvidia's stock price chart, you can hardly see a pullback, so I think this (three-day decline) is meaningless."
For some who question Nvidia's high valuation, Eisman said that price is the least of their concerns.
One thing I learned while running a hedge fund is that shorting a stock just because of its valuation is a dead end.
"Even if people think the stock price is expensive, they will still buy it because they believe in the story."
"As long as the story is intact, just like Nvidia's obviously complete story, the story will continue. I'm not too concerned about Nvidia's valuation."
Saira Malik, chief investment officer of Nuveen Asset Management, also said that Nvidia will continue to benefit from the booming demand for artificial intelligence.
Anyway, Nvidia is basically the winner in this field, and anyone who wants to enter the AI field basically has to use Nvidia's products.
Their growth rate is so strong that their P/E ratio is really not expensive.
Editor/tolk