My Thoughts On NVIDIA $NVDA Stock After Earnings

Paul Gabrail and Mo Hussein give their thoughts on NVIDIA stock in the video above, as the company just released its most recent earnings call. Is $NVDA stock a buy? The guy perform an NVDA stock analysis to find out.

#nvidia #earnings #everythingmoney

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Guys Nvidia just reported revenue and profit we’re going to cover their earnings release in just a few seconds but there’s a lot of talk about Nvidia being a bubble we’re going to break that down and see if we think that’s the case Mo take it away what did Nvidia report

All right Nvidia has reported they are up right now 6% I’m going to read it right here from Nvidia themselves earnings per share of $516 beating expectations of $464 Revenue of 22 . 1 billion versus 20.55520° record quarterly Revenue 22.1 billion up 22% from Q3 and 265 per from a year ago

Data center Revenue up 49% from a year ago record full year Revenue up 126% and as we just continue on these record numbers are absolutely mind-blowing and here we’re going to look at Gap versus non Gap and just look at the comparisons I mean over here in Q4 6.05 versus

22.1 billion absolutely insane come and look at their their um their operating income 1.25 billion a year ago today 13.61% this looks like a company that is a growth company that has only been around for a couple of years but it’s Nvidia they’ve been a staple everywhere actually I’m using an Nvidia Graphics

Chip in the screen in front of me look at these continue uh Financial summaries for fiscal year 2024 60.9 billion in Revenue total versus the last year doing a full year of about 27 billion just just something and when you come down here to their Outlook and this is

Probably what people are looking at as Outlook and that’s why the stock price is moving up now 7% expecting 24 billion plus or minus 2% when you come to Gap and non-gaap gross margins expected to be 76 76 6.3 and 77% respectively plus or minus 50

Bips guys they just don’t stop they just do not stop and here you have the Integrations that they’ve came up with the Partnerships that they’ve come up with they’ve launched in collaboration with Google for some AI platforms they’ve started working with Amazon web services the list goes on and I do not

See these guys slowing down anytime soon full year I sorry fourth quarter revenue of 2.9 billion just from their gaming side up 56% from a year ago Ju Just Amazing everything that they’re doing they are firing on all cylinders right now I cannot wait to see what this company

Does in the future they are now up almost 8% all right so let’s break down Nvidia right now guys Nvidia has been on a meteoric rise if you look just in the last one year it’s up over 230% in the last 10 years it’s up 14,000 per. that is

Insane that means you made 140 times your money essentially 140 times in just 10 years and it’s not like the company was small 10 years ago it was a over A1 billion do company at that point they’ve done a great job with AI but this recent runup

In the last just this year alone they’re up over 40% this year alone that’s incredible for a company as large a a a trillion dollar plus company to be up over 40% in just the last six or seven weeks is an insane number feels bubish now couple things that we don’t like PE

And 5-year PE insanely highing on 400 right now if they were going to double their earnings for the next 10 years that would be nothing right the question is is that an appropriate assumption now one thing I do love about Nvidia Enterprise Value is very close to the

Market cap they have very little debt that’s what’s awesome about them companies that have very little debt have staying power if you’re committed to this bank and business starts to turn you still owe that money to the bank and we’ve seen interest rates climb and climb and climb so that causes the

Interest cost to go up but for a company like Nvidia and a lot of great tech companies today they keep very little debt on their balance sheet it makes them less susceptible to interest rate risk and it keeps the cash in their pocket to whether the storm of bad

Things do happen to say that Nvidia is an incredible company I truly believe is an understatement this company is printing money they’re on the Forefront of AI for chips they’re considered the leader and their quality is incredible back in the 90s I was a big computer nerd and we loved Nvidia processors and

Chips back then the graphics cards were incredible that has never ever waned it’s always been a top tier quality company but remember it is very possible to overpay for Quality let me give you an example Ferrari Lamborghini Rolls-Royce Bentley these are incred car manufacturers that we all know we would

All there hard to argue I don’t care if you don’t like a certain car I’m not a fan of Lamborghinis doesn’t mean that I don’t think it’s an incredibly high quality company but is there a price to pay that’s too high to own a Ferrari to

Own a Lamborghini to own a Bentley to own a Rolls-Royce of course there is and I want you to join me in looking at companies the exact same way don’t look at them as a price going up and down you’re buying a piece of a business and

I do believe you should pay a premium for a high quality business with a high quality balance sheet like Nvidia but the question is what price is too high there’s been a big runup is it a bubble I don’t know let’s go see what analysts are saying what are analysts projecting

For the future guys it’s actually surprising here look at this $11 per share going to $30 a share in the next four years big jump but 400 times earnings close to 400 times earnings even if it hits us $30 per share this is tripling it’s still going to be 130 time

130 times plus earnings price per earnings ratio and for a company that large it’s very difficult if this company were small a couple hundred million dollars growing their revenue and had a long long Runway of growth I would say awesome this company has a lot of runway for growth but at over a

Trillion and a half market value it’s hard to really drive that let’s go look at their revenue and compare it to other companies you might sit there and say Paul it’s not fair guys in 2023 $ 57 billion in Revenue that’s what Intel did Intel just a little bit above that I get

It I get it Nvidia has way better potential than Intel as of what we see right now but 57 58 billion this is and Nvidia is selling for 10 times more market cap than Intel that’s an incredible number that’s incredibly different doesn’t mean I’m equating them as companies it just means a comparison

You look at a company like birkar Hathaway birkar hathway is valued at onethird of what Nvidia is NVIDIA in that time period right here made $26.7 billion Burkshire hathway did $400 billion in Revenue versus the revenue of 57 billion and they did $77 billion in net income versus the 20 some billion

Doll that Nvidia did yet Burkshire hathway is selling for onethird the value the market cap of Nvidia that’s the crazy part guys a apart from a few shares outstanding increasing it’s all check marks and I don’t blame them for issuing shares when their stock price is

So high I’d be issuing shares too why because hey might as well get that cash in and not take on debt might as well sell overpriced shares potentially but look at these PE and 5year PE and five year price of free cash flow insane guys they pay a Ply $398 million in dividends

Isn’t that adorable it’s adorable I don’t know why they even bother with that so the question becomes what’s it worth to us now guys you’ve seen me using the software I love our software I use it every single day and there are so many more tools that we haven’t even

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Probably one of the most important parts here chat with like-minded investors being a value investor being any sort of investor is a lonely road in this community we have there are thousands and thousands of people in there engaging every day talking about things they love we’ve had over 16,000 people

Sign up for our software and community over its lifetime it is so incredibly popular guys $7 for 7 days just try it out lowrisk $7 for 7 Days that’s $1 come to everything money.com try it out check it out I’m sure you’ll see the value here all these green check marks versus

What our competitors do out there so come check it out stock analyzer tool which I talked about covering here I’m going to do a 10-year analysis now I’m going to pull up Nvidia what I did in the past and I can use that I did that back in

September now there’s going to be a lot of discussion about what are the revenue growth potentials for this company because they’re all over the board I put in 10 20 and 30% per year which is a lot guys it really is a lot just to give you

An idea at 20% Revenue growth for 10 years it takes their revenue to over $340 billion a year at 30% I’m just going to estimate here an extra 10% per year you’re talking about six or 700 billion dollar in revenue from 56 billion today so it’s just like absolute

Meteoric rise in Revenue question is is that possible look at Tesla Tesla’s crushed it but look at their stock their stock is down over 50% % from its all-time high even though things were looking Rosy and great at 414 a share and now it’s stuck at 190 and going

Lower okay I did profit margin 20 30 and 40% and did the same for free cash flow is this reasonable guys remember they’re crushing those profit margins and free cash flow now but you also see a lot of Chip companies coming in and creating more competition when you have more

Competition what happens to margins this is a very very popular and profitable a space competitors will enter now what’s the appropriate PE and price of free cash flow I did 20 25 and 30 guys I know this is going to be a controversial comment and I want to hear your comments

Below I know it feels like this is what’s the PE and price of free cash flow in 10 years when it’s a very mature business what’s reasonable for that look at birkshire look at Amazon look at Google what are their pees and price of free cash flow and then finally I

Usually do a margin of safety in my desired return I did 10 13 and 16 but I’m going to assume a market return of 9% across the board because I want to say what is it worth based on a market return based on these assumptions above

And then from there I can apply my own discount based on the margin of safety I want hit the analyze button guys I have a low price of 143 high price of 1,800 and a middle price of 550 so guys if you believe all my middle assumptions

We’re not far off and if you believe all the High assumptions you should buy this thing all day but it’s your decision to determine what’s the appropriate margin of safety to have on this company so again guys $7 for 7 Days gets the full access go check it out at everything money.com