The stock of NVIDIA Corporation (NVDA), listed on NASDAQ, is witnessing a decline as it approaches its Q1 2024 earnings report release, scheduled for the end of the day.
The stock had registered a growth of more than 14% the day after the Q4 earnings results were announced on February 22 in which the company outperformed the consensus estimate of revenue of $6.01 billion per share with earnings of 88 cents on revenues of $6.051 billion. The uptrend continued until May 18, when the stock hit the $318.28 peak. Since then, the stock has been consolidating, indicating that the momentum is fading.
As per estimates from analysts, the Q1 earnings are expected to remain strong, with an average projected earnings per share of 92 cents and a revenue of $6.52 billion. Apart from earnings performance, investors will also be focusing on how NVIDIA plans to leverage opportunities in the field of artificial intelligence and how the company guides its earnings for the next quarter.
Before the earnings report, Citigroup analyst Atif Malik has maintained a Buy rating on the stock and raised the price target from $305 to $363. Analysts at Stifel, Wedbush, and Keybanc also raised their price targets on NVIDIA, setting them within the range of $290 and $375.
From a technical perspective, NVIDIA’s stock looks neutral before the event. It should be noted that holding stocks or options over an earnings print is similar to gambling since stocks can respond positively to an earnings miss and negatively to an earnings beat.
Want direct analysis? Find me in the BZ Pro lounge! Click here for a free trial.
With support levels at $288 and $272.29 and resistance levels at $314 and $332.19, current price marks are crucial for the stock. Technical analysis shows that Nvidia’s stock is trading in a confirmed uptrend. The recent high of $318.28 was attained on May 18, and the latest confirmed low was at $280.46 on May 12.
- If there is a positive response to the earnings report, Wednesday’s low-of-day can become the next significant low within the uptrend. In such cases, the stock needs to break the $319 mark to continue the trend and achieve an all-time high.
- In case of a bearish reaction, the stock needs to drop below the 50-day simple moving average to reinforce a downward acceleration. However, if the stock holds above the 50-day SMA, it can form a bullish reversal candlestick at that level.
Photo courtesy of Nvidia.
