Nvidia earnings preview: Gaming chips and Arm merger in focus
Matt Weller, CFA, CMT August 13, 2021 11:37 PM
Traders will be keen for an update on the company’s pending $40B acquisition of UK semiconductor company Arm...
At almost exactly half a trillion in market capitalization, chipmaker Nvidia (NVDA) is a top 10 holding in the Nasdaq 100, and many analysts have argued it should replace Netflix as the “N” in the “FAANG” acronym of megacap US technology stocks.
See the key details, themes, and price levels to watch from Nvidia’s upcoming earnings report below:
When are NVDA earnings?
Wednesday, August 8 after the closing bell.
What are NVDA’s earnings expectations?
Traders are expecting the company to report $1.02 in EPS and $6.3B in quarterly revenue.
Key themes to watch from NVDA earnings
The vast majority (~85%) of NVDA’s revenue comes from its gaming and data center segments, so that will be the primary area of focus. The ongoing shift to cloud computing and digitally-enabled remote work has been a major driver for the company in recent quarters, and traders expect those trends to continue even as many developed countries fitfully reopen as the COVID pandemic recedes. Meanwhile, NVDA also launched its GeForce RTX 30 Series of chips at the start of the year, and sales for the line should remain strong as gamers and other users upgrade their rigs.
Finally traders will be keen for an update on the company’s pending $40B acquisition of UK semiconductor company Arm. UK regulators have expressed some national security concerns over the merger, but if and when those concerns are addressed, it would be a bullish sign for NVDA’s stock.
NVDA stock technical analysis
Speaking of the price action, NVDA has been on a tear since bottoming near $116 in early March. The stock nearly doubled to peak at about $208 through early July before retracing to test its 50-day EMA around $180 by mid-month. Now, prices are once again on the march, with the rising 50- and 200-day EMAs pointing to a healthy long-term uptrend. In the immediate term, a stellar earnings report and strong guidance could push the stock to break out to new record highs above resistance in the $208 area, whereas a more tepid report could take prices back down to retest the 50-day EMA near $190.
Source: TradingView, StoneX
How to trade with City Index
Follow these easy steps to start trading with City Index today:
- Open a City Index account, or log-in if you’re already a customer.
- Search for the market you want to trade in our award-winning platform.
- Choose your position and size, and your stop and limit levels.
- Place the trade.
This report is intended for general circulation only. It should not be construed as a recommendation, or an offer (or solicitation of an offer) to buy or sell any financial products. The information provided does not take into account your specific investment objectives, financial situation or particular needs. Before you act on any recommendation that may be contained in this report, independent advice ought to be sought from a financial adviser regarding the suitability of the investment product, taking into account your specific investment objectives, financial situation or particular needs.
StoneX Financial Pte. Ltd., may distribute reports produced by its respective foreign entities or affiliates within the StoneX group of companies or third parties pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the report is distributed to a person in Singapore who is not an accredited investor, expert investor or an institutional investor (as defined in the Securities Futures Act), StoneX Financial Pte. Ltd. accepts legal responsibility to such persons for the contents of the report only to the extent required by law. Singapore recipients should contact StoneX Financial Pte. Ltd. at 6826 9988 for matters arising from, or in connection with the report.
In the case of all other recipients of this report, to the extent permitted by applicable laws and regulations neither StoneX Financial Pte. Ltd. nor its associated companies will be responsible or liable for any loss or damage incurred arising out of, or in connection with, any use of the information contained in this report and all such liability is hereby expressly disclaimed. No representation or warranty is made, express or implied, that the content of this report is complete or accurate.
StoneX Financial Pte. Ltd. is not under any obligation to update this report.
Trading CFDs and FX on margin carries a high level of risk that may not be suitable for some investors. Consider your investment objectives, level of experience, financial resources, risk appetite and other relevant circumstances carefully. The possibility exists that you could lose some or all of your investments, including your initial deposits. If in doubt, please seek independent expert advice. Visit cityindex.com.sg for the complete Risk Disclosure Statement.