Tech giant Nvidia (NASDAQ:NVDA) has become a hot favorite of investors for several reasons. It is one stock that will not let you down and continues to grow. NVDA stock has grown more than 125% this year and there are several drivers that keep the stock moving.
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The shares went from $140 in May to $330 today. It has more than doubled and rewarded the investors who were patient. However, it is never too late to buy NVDA stock. It is only going to grow. Let’s dig deeper into my investment thesis for the tech maker’s stock.
Performance Pushes NVDA Stock
Nvidia recently reported the third-quarter results and it did not disappoint. The company beat earnings expectations for another quarter with earnings per share of $1.17 and revenue at $7.1 billion. Nvidia’s earnings have increased 60% year over year and the revenue is up by 50%. For the next quarter, the company expects another $7.4 billion in revenue. The results led to a rise in the NVDA stock price and it took the market capitalization of the company over $800 billion.
The demand for artificial intelligence chips (AI) is on the rise and this led to the growth of its data center revenue by 55%. Some of the top companies are choosing to work with Nvidia for AI applications and this led to sales of $2.9 billion. Gaming segment revenue is $3.22 billion, up 42% year over year. That surging demand for Nvidia chips is proof that they offer something other tech companies don’t.
The future is very bright for Nvidia and it will reflect on the bottom line. We will continue to see solid revenue and sales numbers in the coming quarter with commensurate gains in the NVDA stock price.
Solid Industry Moves
What makes Nvidia different is its presence across different industries and sectors. The company is not restricted to a particular industry but is making strong moves across many including the electric vehicle sector. Nvidia is in the news for metaverse where it offers software, avatars, and language models.
Further, its self-driving car platform has become a gold standard for carmakers. NVDA stock is one of the best lidar stocks to own today. The DRIVE platform will be available for vehicle models from 2024. Lidar is a key technology that helps self-driving cars and if you try to predict the future of the automobile industry, you will see the massive presence of lidar.
The Bottom Line On NVDA Stock
Nvidia is on the right track, right in time. Fundamentally, Nvidia is stronger than it has ever been. The numbers are proof that the company is moving in the right direction and making big money. Considering the way it is growing and expanding its market share, it can be rightly said that Nvidia will be a major tech company in the coming years. Neither the pandemic nor the chip shortage could hamper the growth of the company.
Whether it is gaming, data center, or autonomous driving technology, there is so much that Nvidia can give. It is constantly expanding with unique technology and innovative products. The company is setting the best standards in the industry and this will reflect on its bottom line. Nvidia has a solid upcoming quarter and 2022 could be its best year in the industry.
It is already enjoying a valuation north of $800 billion today and considering the potential of the company, NVDA stock looks cheap but may not go down anytime in the coming months and if you want to make the most of the growth of the company, invest in NVDA stock at the earliest.
On the date of publication, Vandita Jadeja did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Vandita Jadeja is a CPA and a freelance financial copywriter who loves to read and write about stocks. She believes in buying and holding for long-term gains. Her knowledge of words and numbers helps her write clear stock analysis.
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