NVDA… One Year Since Ray Blanco’s First Partial Sell
NVIDIA Corp. (NASDAQ: NVDA), which we mentioned briefly on Friday, closed trading last week at $216.14, up $10.82 or 5.27% on Friday alone.
Thursday, NVDA reported quarterly earnings after the market close.
The company reported $838 million in net income in the 3rd quarter, up from $542 in the same quarter a year ago.
According to MarketWatch, that shakes out to $1.33 a share compared to $0.83 a year ago.
We hesitate to use the expression “printing money” but that’s exactly what NVDA’s doing now.
A month ago, NVDA traded at $191 a share.
Six months ago, NVDA sat at $127.
Over the last twelve months, shares are up 218%.
This is where we must make the obligatory mention that Ray Blanco added NVDA to the Technology Profits Confidential model portfolio on Feb. 6, 2015 at $20.38.
Including $1.30 in dividend payments along the way, today’s price means you could be sitting on a 967% total gain.
Part of which is realized gain, if you followed Ray’s research and his recommendations.
On Aug. 26, 2016 Ray said to sell 1/3rd of your position for a 206% gain.
Then, on Nov. 11, 2016 Ray said to sell another 1/3rd of your position for a 339% gain.
After two partial sells that big, the rest is gravy.
And if you’re a NVDA shareholder, there’s been nothing but gravy in the year since Ray’s last recommended partial sell.
But Why Is NVDA So Special?
But this doesn’t answer the most important question… why? Why has NVDA roared higher and higher, with no end in sight?
The short answer is great products in growing markets.
The longer answer is from gaming, to data centers, to autonomous vehicles, to the cryptocurrency boom, NVDA’s processors are gold standard.
Reuters, CNBC and Barron’s reported last week that NVDA’s gaming segment revenue increased 25.1% year-over-year from 2016.
Tech Crunch and Business Insider report data center-focused sales came in at $501 million, beating analyst estimates by nearly $30 million.
Business Insider and Reuters reported autonomous systems sales were up 13.3%.
CEO Jensen Huang is on record saying he expects advances in artificial intelligence to allow for widespread driverless vehicles in the next four years.
Now here’s the funny part…
If there’s one line of business NVDA leadership isn’t high on, it’s the story that has everyone in a tizzy in 2017: cryptocurrencies.
Bloomberg, CNBC, and CoinDesk all reported NVDA processor sales into crypto-mining applications DROPPED to $70 million from $150 million in the prior quarter.
Alone, this doesn’t mean bad news for cryptos.
But if you’re looking for a canary in the coal mine for potentially cooling crypto demand, NVDA’s a good bellwether.
And even with a 50% haircut in high-end processors sold for crypto applications, NVDA’s still putting up huge numbers.
RBC and Jeffries have a $240 target on NVDA as of today. Needham and others have a $250 target.
Why stop there?
NVDA is to tech of today what Intel was generations ago or Microsoft was one generation ago.
NVDA is the future.
Turning to the markets this morning…
Market Rundown for Mon., November 13
S&P 500 futures are down 4.00 this morning at 2,575.
Oil’s basically flat at $56.85. Gold’s up $4.90 at $1,279.
One Bitcoin goes for $6,532 this morning.
The Wall Street Journal, MarketWatch, Reuters and others this morning report General Electric (NYSE: GE) plans to cut its quarterly dividend payment by 50%.
This is only the third time in history GE has cut its dividend. Tough days for GE:
Shares of GE are up 2.00% pre-market this morning, at $20.90.
Talk with you again on Wednesday.
For the Rundown,