Nvidia (NVDA) Stock Analysis: Tech giant posts 122% revenue growth as AI demand soars

TLDR:

NVIDIA is currently trading at $140.52, indicating strong performance after Q3 2024 earnings. Revenues increased 122% year-over-year to $30 billion, and EPS beat expectations by $0.68. Inventory has increased 923% over the past two years due to AI-related growth and data center demand. This is due to the concentration of major customers. It trades at 36 times forward earnings, which is at risk despite its dominant market position, with analysts predicting continued but variable growth through 2030.

NVIDIA (NASDAQ: NVDA) continues to ride the artificial intelligence wave, following exceptional Q3 2024 financial results that demonstrated the company’s dominant position in AI hardware October 29, 2024 As of today, the stock is trading at $140.52.

The semiconductor giant reported quarterly sales of $30 billion, up 122% year-over-year, and earnings per share of $0.68, beating analysts’ expectations of $0.64.

This performance has helped NVIDIA’s stock price rise 923% over the past two years.

The company’s computing and networking division emerged as a key growth driver, with revenue of $26.3 billion in the second quarter of fiscal 2025, up 16% sequentially and 154% year-over-year. This growth is primarily due to strong demand for NVIDIA’s H100 data center GPUs.

According to technical analysis, the stock is currently facing resistance at $145.00, with a major psychological barrier at $150.00. Support levels are set at $136.15 and $130.03, and it has been holding steady in recent months.

NVIDIA’s Networks division has shown particularly strong momentum, with revenue reaching $3.7 billion in the second quarter, an increase of 114% year over year. The company’s Spectrum-X product line is projected to become a multibillion-dollar business within the next year.

Looking ahead, Bank of America analyst Vivek Arya predicts that NVIDIA could capture $272 billion in AI computing revenue by 2030. However, the broad consensus among analysts suggests more modest growth, with estimated cumulative revenues of $1.29 trillion from fiscal year 2025 to fiscal year 2030.

Despite its strong market position, the company faces several challenges. A notable concern is that NVIDIA has an unusual level of customer concentration for a company of its size, with several large technology companies accounting for a significant portion of its revenue.

According to Fortune Business Insights, the global artificial intelligence market is expected to grow from $621.19 billion in 2024 to $2,740.46 billion by 2032, at a compound annual growth rate of 20.4%. corresponds to

NVIDIA continues to innovate, and the upcoming H200 and Blackwell B200 architectures promise performance improvements. The Blackwell architecture claims to deliver 30x better inference performance while consuming 25x less energy for large AI models.

Competition has begun between AMD and Intel, but these competitors are now focused on undercutting NVIDIA’s prices rather than outperforming NVIDIA’s products. NVIDIA maintains its competitive advantage through its industry-standard CUDA software platform.

The company’s stock is currently trading at a forward price/earnings ratio of 36 times, reflecting high growth expectations. Analysts predict a future trading range of $140-$220, but some warn that a recession could push the price below $100.

The current resistance level suggests $145.00 is a short-term challenge, but $136.15 is a reliable lower bound for the stock.

NVIDIA’s network revenue reached $3.2 billion in the first quarter of fiscal 2025, an increase of 242% year over year, demonstrating growth across multiple segments.

Technical indicators suggest that a sustained price above $140.00 indicates strength, but a break below $136.15 could trigger a pullback to $130.03.

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