Has The Nvidia Stock Bubble Burst?

NV reported an amazing earnings report we already covered the earnings report if you missed that it's going to be in the top right corner so what did we miss why is the stock currently down 3.4% while the overall Market is green what did we miss let's discuss that now their market cap is under $3 trillion and actually valuation Wise It's a little bit cheaper than yesterday it now has a Ford PE of 37.1 times cheaper than a three-year mean yes that's true the stock has gone up quite a lot but it's still cheaper than its threeyear mean evida also cheaper 30.3 times price to sales is still Sky High at 20.5 times compared to 18.3 times price of free cash flow sits at 63.7 times and then price earnings to growth still sits at one so yeah I mean you could say yeah all the others are are very very expensive but I mean price earnings to growth one that's that's not not expensive and remember the stock is still up 144% year to date and currently the average analyst price target has gone from $143 yesterday to now $146 representing around 20.5% upside from the price we're at today so again what has happened what has changed nothing right nothing much the numbers were quite good the comments were okay just the market doing its thing right well let's have a look at some other stuff and things that were mentioned during earnings call and during some interviews as well if you enjoy this type of videos leave it a thumbs up subscribe if you have not would really appreciate that want to support me even further do check out the link down in the description and up in comment to get the top 10 best stocks to buy now or go to full.com investor thank you very much let's first start with a couple of price Target upgrades well actually all of them are price Target upgrades if you want to look at them all you can pause the screen here but basically everybody upgraded their own price Target then a quick reminder of what was mentioned yesterday Hopper demand remains strong and the anticipation for Blackwell is incredible customers continue to accelerate their Hopper infrastructure purchases while gearing up to adopt Blackwell of course Blackwell was in the center stage right we shipped customer samples of our Blackwell architecture in the second quarter we executed a change to the Blackwell GPU mask to improve production yield Blackwell production Ram is scheduled to begin in the fourth quarter and continue into fiscal 2026 by the way for those that don't know this is second quarter fiscal 2025 in the fourth quarter we expect to ship several billion dollars in Blackwell Revenue Hopper demand is strong and shipments are expected to increase in the second half of fiscal 2025 so in the next two quarters now another thing is that Nvidia is known to beat the analyst estimates by quite a lot actually but as you can see here since Q2 of fiscal 2024 well the beat has become smaller and smaller it's still it's still amazing but I'm just trying to think from a wall Street's perspective what has gone wrong so back then well a year ago they beat by 22.3% then 12.6% then 8.3 5.5 and now only let's say only 4.1% and maybe the market is like okay maybe the next quarter they'll come even closer to an expectations so why should we give it such a big premium maybe maybe that's the way they're thinking I mean all in all it was another very very good quarter right if any other company reported something like this you would have been up 10 20% or so right if let's say Intel reported something like this it would have probably been up 30% but of course Nvidia is no Intel Intel is no Nvidia valuation wise they're nowhere near as well profitability wise same thing so yeah I mean it's true it is a very expensive stock but as we've seen if we are forward looking so making the assumptions that what will happen in the future will definitely happen or maybe become even better then it's not that expensive but those are just assumptions now if you look at Q3 what Nvidia has told us that they expect we know that it's probably going to be a bit higher than that but still they beat analyst consensus numbers by around 2.2% for Revenue grow gross profit and operating income so all in all it was still a very very good quarter now a couple of things that Jensen said during the call and during some interviews as well so hyperscalers are 45% of the data center business on one side 45% is a lot but on the flip side you still have 55% that are not hyperscalers those Sovereign AIS every other company that is not a hyperscaler etc etc in very various Industries so yeah it's true that hyperscalers contribute quite a lot to nvidia's success but 55% is coming from the others he also said that Supply is improving every single quarter from now on as well no plans to become a cloud compute provider so no plans to compete with GSP AWS Azure Oracle etc etc they also mentioned low digit billion sales in Sovereign Ai and liquid cooling talked about liquid cooling especially when talking about about Blackwell why is that well because the grce black well is liquid cooled however the number of data centers that want to go liquid cooled is quite significant the reason for that is because we can in a liquid cool data center install and deploy anywhere from three times to five times the AI trut compared to the past and so liquid cooling is cheaper liquid cooling TC is better and liquid cooling allows you to have the benefit of this capability we call NV link which allows us to expand it to 70 two Grace blackw packages which has essentially 144 gpus I've talked about liquid cooling before when talking about D and smci I mean I've shown you comments from I believe an analyst and an expert talking about the difference between air cooled and liquid cooled the difference is huge huge and you save Millions if not billions of dollars worth of energy if you switch to liquid cooling which of course these things are great comments for the likes of Dell and smci although MCI I believe we still waiting for some comments from management which regards to the delay 10K now moreover here the h200 and China so nvidia's h200 platform began ramping in Q2 shipping to large csps consumer internet and Enterprise company the Nvidia h200 builds upon the strength of our Hopper architecture and offering over 40% more memory bandwidth compared to the h100 our data center Revenue in China grew sequentially in Q2 and is a significant contributor to our data center Revenue as a percentage of total data center Revenue it remains below levels seen prior to the imposition of export controls we continue to expect the China Market to be very competitive going forward so at least we've got some positive comments coming from that corner for those of you that did Miss yesterday's video and still have not seen the numbers for the quarter this is basically it tremendous growth year over-ear even quarter over quarter these numbers are very very respectable of course they're not going to be 20 40% 80% grow quarter over quarter anymore but I mean growing 15% quarter over quarter is still quite good and so right now looking at the daily well it is now in a constant battle red green red green red green we're basically at the 20-day moving average here the 50-day one sits at $117 which was basically where the stock opened I believe earlier today the 200 day one sits at $92 RSI is neutral on the let's say down trend on the daily if we switch quickly to the weekly right now we can see that RSI is high but not overbought and well again same thing maybe maybe 130 is a resistance got rejected there stock might make its way back down let's see I think for long-term shareholders I don't think you would mind buying Nvidia back under $100 so overall to conclude I believe the story here the explanations is quite simple the company still does what it has to do it grows it dominates I mean this is a company that in my opinion or last time I checked never really lied to us or said something and then something else has happened no actually it says one thing and it did it and did it even better now maybe the market was maybe expecting something amazing I guess right like that kid in The Incredibles I don't know something amazing I guess but no they delivered they delivered another strong strong quarter I don't know what the market was expecting $50 billion in Revenue I I don't understand it is growing yes of course growth will maybe slow down a little bit until they launch black well margins will get hit in the short term as I mean will get hit it's still 74 75% it's still quite amazing I would say they still have a huge huge Advantage huge difference between the number two number three player I mean the thing here is that Hardware is wanting but when you want to make sure that people keep on buying your Hardware you better make sure that the soft Ware is the best of the best and that's basically Cuda cuz we know we know that every other big company out there is designing their own chips but because yeah I mean from a profitability standpoint you cannot buy constantly Nvidia chips and that's about it no maybe inh housee you need your own chips because you can make it maybe cheaper less energy required etc etc okay we've been talking about the fact that maybe 5 10 years from now all of those hyperscalers or the B companies will have their own chips and they'll need Nvidia a bit less maybe maybe but not everyone has the money to design their own chips plus you have to design good software and that's exactly what Cuda is Cuda has been around for more than a decade so yeah I think they know thing or two about that so yeah overall good quarter amazing company if you can get this stock for less then why complain will it go much lower I don't know I don't have a cryst Ball but that's about it I think all the negativity that people are saying here is is just to get some clicks and views or whatnot I think we can see that Wall Street despite the stock being down a little bit Wall Street does know very very well what Nvidia is and what Nvidia will be doing in the future maybe maybe they're chasing the hype and the bubble has popped who knows remains to be seen but right now until they really show us huge slowdown and margins explode on the way down until then I don't think you should be worried anyways that's all I got for you right now give a like subscribe do all of that and I see you all in the next one bye-bye [Music]