Tomorrow, investors in any of the artificial intelligence chip suppliers will watch Nvidia (NVDA) when it posts quarterly results. After the market closes, NVDA stock could move by as much as 10% in either direction. This trading price range is based on options volatility.
Before this report, Super Micro Computer (SMCI) posted strong results and issued a bullish outlook. Still, SMCI stock slumped after the report, only to stage an impressive v-shaped rebound in the weeks that followed.
Nvidia’s results will matter more than that of SMCI. The graphics chip supplier will give the market insight into demand levels for the current generation AI servers. The company will also update investors on the status of its next-generation Blackwell product. Markets speculated that Nvidia would delay the release of Blackwell.
On Tuesday, NVDA stock fell by 2.25%. Buyers who regretted buying the stock in June and July at the $140.76 high likely sold the stock during the recent rally. Fear is higher than usual. NVDA stock trades at an 84 times price-to-earnings ratio. Its 33.2 times forward P/E ratio depends on the company forecasting earnings of $3.80 a share in 2025.
Regardless of Nvidia’s outlook, neither Advanced Micro Devices (AMD) nor Intel (INTC) may catch up to Nvidia’s market leadership. That partly justifies the premium in NVDA stock.