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My Gut Feeling for February 19, 2024: It’s All About Nvidia

My Gut Feeling for February 19, 2024: It’s All About Nvidia

February 20, 2024

In every decade there is a stock which is the fulcrum for which the stock market direction is determined. In the 1980s that stock was International Business Machines (IBM) better known as IBM or “Big Blue.” In the 1990s, the heart of the tech revolution that stock was Intel (INTC). The 2000s were a bit trickier given the 9/11 attacks, the bust and the financial crisis. In that decade, the big survivors of the bust, namely Amazon (AMZN) and the emergence of Google, now Alphabet (GOOG / GOOGL) were the co-leaders of the market. They were supplanted by Apple (AAPL) in the 2010s and early 2020s. Now sitting atop the mantlepiece is Nvidia (NVDA). If you have held NVDA over the course of the 2020s, your portfolio has greatly benefited. If not, I’m sorry to say, you have greatly underperformed.

Source: Telemet

So, even if you were brave and held it thought the 100-year flood of 2022, you have been well rewarded. Our earliest purchases go back to 2019.

NVDA is a leader in semiconductor production for computing, graphics, gaming, and Artificial Intelligence (AI). It’s the AI component which sparked a huge rally after the company reported 3q23 results and provided extraordinary 4q23 guidance.

Now on Wednesday, February 21, after the market closes, NVDA will deliver 4q23 results and 2024 guidance. For the record, consensus Wall Street estimates call for NVDA to earn $4.29 per share on revenues of $19.11 billion. For full-year 2024 NVDA is expected to earn $11.52. By some measures, NVDA is too richly priced. By others, it is still cheap. I do think that the stock could reach the $1000 price level. It is quite possible that NVDA will announce a major buyback and/or increase its dividend and/or split its stock this week.

No matter what the company announces, it will be the major news that sets the pace for the stock market this week and going forward – either upward or downward.


Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView Asset Management, LLC was long AAPL, AMZN, IBM and NVDA  - although positions can change at any time.

Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, (LVAM) an investment advisor representative, specializing in high-net-worth private wealth management. LVAM is affiliated with Kingswood Wealth Advisors Services, a registered investment advisor.

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