Nvidia's stock has dropped 16% below $120 despite impressive earnings growth and AI dominance.

From Nasdaq: 2024-07-30 04:15:00

Nvidia (NASDAQ: NVDA) has impressed investors with triple-digit earnings growth and a strong stock performance due to its dominance in AI technology, holding 80% of the market. Despite a recent stock split reducing its price to around $120, the stock has since dropped 16% below that level.

Nvidia’s success in AI, with GPUs powering tasks like training LLMs, has led to record revenues and a stock price increase of 2,400% in the past five years. Despite facing increased competition, Nvidia’s focus on innovation and a rapidly growing AI market positions it well for continued growth with the upcoming release of its Blackwell architecture.

While Nvidia’s valuation of 66 times trailing-12-month earnings may seem high, its revenue growth and strong growth prospects suggest a potential rebound in the stock price. The current price below $120 presents a buying opportunity for investors looking to capitalize on the AI leader’s long-term growth potential. Investors should consider the insights provided by the Motley Fool Stock Advisor team before making a decision.



Read more at Nasdaq: Should You Buy Nvidia Stock While It’s Less Than $120?