The Cosmic Rock And Roll Nvidia Trade, Up 800% Since End-2022
(MENAFN- The Arabian Post) Arabian Post -
Matein Khalid
Jim Cramer renamed his dog Nvidia and I have renamed my periodic Mag-7/MAGA bull sessions with my fellow nasdaq junkies as Nvidia Nights and why not? I shared my convictions that Nvidia was headed to 150 two years ago when NVDA traded at a pre-split price well below $20 a share in late 2022 when Powell's monetary tough love had slammed Nasdaq and the AI frenzy had not really begun. These posts were available to anybody for free as I believe it is good karma to share knowledge that can be useful with the world and hence my self-styled title of Nasdaq Vishwamitra (sorry Dev, LOL). In any case, put NVDA shares on your smartphones and you can fathom why I feel like a Turkish whirling dervish, an AI Chip Lord Gaga.
Nvidia is up 800% since New Year's Day 2023, its leveraged tracker NVDL is up 350% in the last 12 months alone. I wonder if Manju agrees, but Chamchanomics hit paydirt on this puppy. I bought the post-election dip in NVDA in my trading account when it fell below 130 since the production bottlenecks at Blackwell have now been resolved, as has the arb after the Broadcom bombshell on customized silicon prospects. It would not surprise me if NVDA EPS rises as high as 50% next year as the market for AI infrastructure will remain white hot. So in my valuation playbook, NVDA trades at a forward multiple of 32 and a PEG ratio of only 0.5. As a lover of ice cream cones, I will buy NVDA on every dip and the 15% dip since the recent 148 earnings high is finger lickin good.
AMD was a short on the charts since it peaked at 211 but I did not have the guts to do anything more than a transient Lilliput size swing trade. In any case, NVDA made the cash register ring with a decibel count that sent shock waves through the Valley and Wall Street. So Lisa Su was the sad sack or sad sackette. However, I feel AMD has got its act together and will benefit hugely next year from the theme of AI reset PC/laptops, enterprise Gen-Z adoption, robotics and driverless cars. The shares now trade at a pathetic 125 or 24X next year's EPS. Yummy for me since the peg ratio is also well below one, making this an opportune moment to go tactically long Lisa again.
Broadcom (AVGO) is the biggest beneficiary of the hyper-scaler custom chip trend, which it believes will have a $75 TAM in the next three years. The spectacular $300 billion pop in AVGO owed as much to the bullish CEO crystal ball gazing at the earnings conference call as to yet another quintessential Nasdaq short squeeze, another routine Wall Street ambush. This does not negate the fact that AVGO will share in the pot of gold as Microsoft, Amazon and Google partner with it to design/deploy their customized chips. If I get AVGO via options strategies at 210, which is almost certain in early '25, I will pull the trigger. May the Force be with you for a blessed New Year. Merry Kwanzaa!
via The cosmic rock and roll Nvidia trade, up 800% since end-2022
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