NVIDIA Corporation (NVDA)
During the last year, NVIDIA returned a positive performance of 209.1%, with a high of $553.46 and a low of $167.31. Over the same period, the stock outpaced the S&P 500 index by 189.2%. The company's 50-day average price was $484.34 per share as of January 2024. NVIDIA Corporation provides graphics, and compute and networking solutions in the United States, Taiwan, China, and internationally. Based in Santa Clara, CA, the large-cap Technology company has 26,196 full time employees. NVIDIA has not offered a regular dividend within the last year.
Increasing Revenues but Narrowing Margins:
| 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | |
|---|---|---|---|---|---|---|
| Revenue (M) | $9,714 | $11,716 | $10,918 | $16,675 | $26,914 | $26,974 |
| Net Margins | 31% | 35% | 26% | 26% | 36% | 16% |
| Net Income (M) | $3,047 | $4,141 | $2,796 | $4,332 | $9,752 | $4,368 |
| Diluted Shares (M) | 2,500 | 2,472 | 2,520 | 2,538 | 2,499 | 2,494 |
| Earnings Per Share | $1.22 | $1.68 | $1.11 | $1.71 | $3.9 | $1.75 |
| EPS Growth | n/a | 37.7% | -33.93% | 54.05% | 128.07% | -55.13% |
| Avg. Price | $57.56 | $43.41 | $98.65 | $194.95 | $185.55 | $206.53 |
| P/E Ratio | 45.68 | 25.39 | 86.54 | 111.4 | 47.7 | 116.68 |
| FCF (M) | $2,909 | $3,143 | $4,549 | $5,665 | $8,850 | $5,267 |
| CAPEX (M) | $593 | $600 | $212 | $157 | $258 | $374 |
| EV (M) | $140,492 | $97,451 | $247,203 | $493,132 | $475,130 | $515,565 |
| EV / EBITDA | 41.21 | 23.97 | 76.6 | 87.59 | 42.37 | 89.38 |
| Total Debt (M) | $2,002 | $1,990 | $7,959 | $10,944 | $12,199 | $10,955 |
| Net Debt / EBITDA | 0.38 | -1.91 | 1.77 | 1.72 | 0.84 | 0.94 |
| Current Ratio | 7.08 | 8.42 | 3.92 | 7.14 | 3.39 | 3.59 |
NVIDIA's P/B and P/E Ratios Are Higher Than Average:
NVIDIA has a trailing twelve month P/E ratio of 72.0, compared to an average of 35.0 for the Technology sector. Based on its EPS guidance of $20.45, the company has a forward P/E ratio of 23.7. The compound average growth rate of the company's historical and projected earnings per share is 49.6%. On this basis, the company's PEG ratio is 1.29. Alternatively, we can use the weighted average of NVIDIA and the broader market's estimated 5-year EPS growth rate. This normalized growth rate of 11.3% gives us a PEG ratio of 5.65, which suggests that NVIDIA may be overpriced. Furthermore, NVIDIA is overvalued compared to its book value, since its P/B ratio of 40.56 is higher than the sector average of 7.92. The company's shares are currently 2287.0% above their Graham number.
There's an Analyst Consensus of Some Upside Potential for NVIDIA:
There are 46 analysts covering NVIDIA, with target prices ranging from $410.0 to $1100.0 per share, for an average of $636.39. As of January 2024, the company is trading -23.9% away from its average target price, implying there is an analyst consensus of some upside potential. On average, analysts recommend to buy NVIDIA.
At 1.1%, NVIDIA has a very low short interest. Institutions own 68.4% of the company's shares, and it has a large amount of insider shareholders because 4.04% are owned by corporate insiders. Overall, the company's top shareholder is Vanguard Group Inc, whose 8% stake in the company is worth $111,433,431,900.
