NVDA
📰 Recent concerns about Nvidia, like the H20 chip ban for China and a Wells Fargo report on paused AWS AI investments, appear overblown or have been refuted, impacting only a small part of the business or based on temporary situations.
💰 Nvidia trades at the most attractive valuation relative to its expected growth among the Magnificent Seven, partly because the market perceives potential cyclicality in its AI-driven business.
🤔 While the risk exists that AI investment might slow if clients don’t see returns, this risk hasn’t materialized yet, and the core growth story remains intact for now.
@Artedeinvertir:
“Regarding Nvidia, people are a bit scared. It’s true there was news about the H20, that they were going to be prohibited from selling certain processors to China, but it’s a very small part of their business. And Wells Fargo published a press release – this is what I always say, that in the stock market there are many hidden interests, and people want to score points – Wells Fargo said, ‘Well, AWS data centers are no longer investing in artificial intelligence and are stopping investment, and this is negative for Nvidia.’ So, Nvidia plummets on the 21st. Then, the head of data centers at Amazon, Mr. Kevin Miller, comes out and says, ‘Hey, at AWS, this is simply routine capacity management, and we haven’t changed our future expansion expectations.’ Okay, but hey, if you short the stock, it goes down, you take profits, then it goes up, and well, the person responsible explains it, but the profit is already made. Nvidia is the company that trades cheapest relative to the growth we saw earlier compared to the others because the market feels there could be some cyclicality in the business. Meaning, yes, it’s growing at 40%, but that might normalize later to 10-15%, or if in the future, which is unknown, clients stop investing because AI doesn’t generate income for them, then yes, that’s a risk, but for now, it’s not materializing.”
Watch the exact part of the video where @Artedeinvertir talks about Nvidia here:
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