This week is Thanksgiving week in the U.S., a week that is typically slow for the market. Many traders do what I will be doing; they take an extended break around the holiday to spend time with their families. That doesn’t mean, though, that the days around the Thursday holiday are completely without any interest, and perhaps the biggest event this week will come after the market close when Nvidia (NVDA) reports their calendar Q3 earnings.

One company’s earnings are not usually of much import beyond their own shareholders, but Nvidia is different. It is a maker of graphics processors and mobile technologies with such a hold on the market for advanced hardware that they have become the embodiment of the market’s excitement about AI. So far, they have borne that responsibility well, not just beating estimates for earnings each quarter, but smashing them, while raising their guidance consistently along the way.

That has, almost inevitably, led to skepticism in some quarters. When a company grows as rapidly as Nvidia has and just seems to get everything right, people understandably start to question how sustainable that is. If nothing else, the law of large numbers as it applies to stock analysis makes continued growth unlikely. It is far easier to grow $100 million of sales by 100% than it is to do the same from a starting point of $1 billion. Also, at some point, the reasoning goes, growth in demand for AI related products has to plateau. Or, even if it continues to grow, a strong competitor to Nvidia will emerge.

Neither of those things have happened yet, though, and Nvidia just keeps going from strength to strength. That has been reflected in the stock over the last year:

NVDA has gained around 300% in 52 weeks, which looks a bit frothy until you dig into the numbers. A chart like that inevitably has some people shouting about how it is all hype and that NVDA is a great big bubble, or whatever. When you look at the details, though, that gain looks fully justified. One can even make a strong argument that, actually, it is underdone, and that NVDA still represents value at these levels. If this were pure speculation, we would be waiting for reality to catch up with the price, but in this case, it is the other way around.

The consensus of analysts’ estimates for Nvidia’s EPS this last quarter is $3.37, which is a 481% gain over the $0.58 per share of profit reported in the same quarter last year. That 300% pop doesn’t look quite so outlandish now, right? In fact, as I said, that implies that NVDA’s market price has failed to keep pace with the increases in earnings, let alone factor in massively improved growth rates that have proven sustainable for the full year, and that it is has at least 50% upside from here, just to keep up with the company’s performance.

When Nvidia reports this afternoon, I have no doubt that the naysayers will make themselves heard, no matter what the numbers say. Based on recent history, they will probably beat expectations and raise guidance again, but that will only embolden the bears further. They will cry that any pop in the stock that follows that is just more hype, even though it would be a perfectly logical reaction to another great quarter. What I am looking for, though, as someone who owns NVDA and is looking to add more, is a relatively unimpressive EPS number, or a note of caution about the future in the earnings commentary, or the analysts’ call that will follow the release at 5 PM today.

They could beat expectations, but not by the spectacular amounts that have become the norm recently. They could also point out what everyone already knows, that the economic future is uncertain, and the stock will still get hit hard as the notion that it is way overbought is pushed. Should that happen, big institutional investors, who typically rely more on facts and data than bluster and bombast, will step in and buy.

On the other hand, if NVDA delivers another blowout quarter and shares optimism about what is to come, even in the face of uncertainty, then institutional investors likely won’t step in and buy in that scenario. But either way, NVDA will be a buy tomorrow morning. I believe there is a chance that the first scenario plays out, so will wait until after earnings to make a move, but at some point before the holiday, I will be buying.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Original: Earnings Feed: Why I Will Buy Nvidia (NVDA) After Earnings Whatever the Report Says