Please give me feedback on my DD, and the formatting. I will try to implement "fixes" on this post.
General Information:
*P/E Ratio 38.05
*Div Yield 0.59
*Market Cap 56.30B
*Institutional Ownership 75%
P/E Ratio:
A few interesting things to consider here are:
Q1 2015 P/E Ratio ~18
Q1 2017 P/E Ratio ~ 42
Also note the fact that in Q1 2015 the stock cost only $20.
In my opinion NVDA is not overvalued at all. Every single segment is more than likely going to grow (more on that later). When you compare NVDA to other tech growth stocks a P/E of 38 doesn't seem so high anymore.
For example: ANET 52, SKY 61, and then there are players like TSLA that don't even have income. NVDA is the top growth stock for a reason.
Institutional Ownership:
An interesting thing to keep an eye on is that on March 31, 2016 institutional ownership was at a high of 90.72%. Which shows that quite a bit of institutions jumped ship, but the shares were picked up by non-institutional owners. However, 75% is still a quite high ownership when compared to AMD, INTC and others. I am a bit worried that the drop we are seeing right now is a result of more institutions jumping ship.
Now getting to the actual interesting part:
My DD on Q1 2018 earnings:
This is an important slide to estimate future growth:
One thing to note is that the gaming segment is historically very weak in the first quarter.
Gaming:
Sources are saying that this quarters gpu sales are down 15%, which is 10% more than in the past. This sounds bad, but one has to remember that 15% down from a record $1,348M income is still a shit-load of money. That results in an income of $1,146M, which is still in line with NVDA's estimated revenue for this quarter. On the other side of things, the 1080TI sales are estimated to be quite high. Additionally, it seems that NVDA has picked up quite a bit of market share from its competitors.
Professional Virtualization:
I don't have too much to say about this segment, but I am sure that it will bring in over $200M in revenue.
Data center:
This segment seems to be exploding. NVDA's revenue trippled year over year, and it doesn't seem to slow down. If you look at the rest of the market, you will come to the same conclusion. I would be surprised if revenue was below $300M.
Auto:
Tesla recently broke out, because they finally got their production up. Additionally, their pre-orders are not stopping. This translates 1:1 into NVDA's revenue. NVDA currently has over 50 automated driving partners. I wouldn't be surprised to see a beat up to $175M, but since I like to be conservative I will say $140M.
Lastly we have OEM & IP, which seems to be the least interesting segment. It has been declining for some time now. Maybe I am missing something here, but I don't think so. We are still going to see a solid $150M of revenue in this segment.
Now one last thing are the switch sales. The sales were reported to be 2.4 Million units in its first month. That could translate into more than $100M in Q1 revenue assuming Nintendo had kept their inventory at JIT levels.
Finally, if we add up all the segment we are well above the estimated $1.9B in revenue. I think that even if we "only" reach the estimated 1.9B we will go back up from the current $95 per share to at least $105. A beat might create a second Q3 2016 (maybe not that big haha).
Submitted April 15, 2017 at 03:16PM by abaabe10 http://ift.tt/2oeo577
