At Extreme Investor Network, we strive to provide our readers with cutting-edge insights and analysis in the world of finance. Today, we will be discussing Nvidia, a semiconductor stock that has captured the attention of investors and analysts alike.
According to Dan Niles, founder of Niles Investment Management, Nvidia is still considered cheap and has the potential to rise further after its upcoming earnings report. Despite experiencing significant growth, Nvidia is currently trading about 15% below its five-year price-to-earnings average, indicating room for upside potential.
Niles draws a comparison to Cisco Systems during the internet buildout in the mid-1990s, suggesting that Nvidia could see similar growth patterns. While Cisco experienced multiple declines during its surge, Niles advises traders to look for periods of consolidation in Nvidia before the next leg up.
Looking ahead, Niles predicts another drawdown for Nvidia early next year. However, he remains bullish on the prospects of AI, highlighting the continued proliferation of the technology by profitable companies. Niles cautions that the growth trajectory of Nvidia may not be a smooth “stairstep up,” likening it to the volatile nature of the internet boom.
Despite the widespread expectation of Nvidia posting a beat and raise in its upcoming earnings report, Niles believes the stock has more room to run. As the AI craze continues to drive investor interest, the average analyst sees another 10% upside potential for Nvidia with a buy rating on the stock.
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