Ethereum Is Not Like Nvidia, Amazon, But More Like Intel, Trader Says: 'Negative Revenue Growth And Negative Profitability'
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Jun 24 2024
0mins
Should l Buy NVDA?
Source: Benzinga
- Crypto Market Analysis: Andrew Kang compares Ethereum to tech stocks, noting similarities in price action with May 2021.
- Market Caution: Despite bullish momentum, Kang warns of potential extreme corrections over a multi-month period.
- Skepticism on Support Levels: Kang expresses doubt about support levels holding amidst market disruptions like Mt Gox estate selling and ETF buyers selling.
- Comparison to Tech Companies: Kang draws parallels between Ethereum's valuation and growth prospects to past tech bubbles rather than sustained growth seen in companies like NVIDIA and Amazon.
- Ethereum's Fundamentals: Kang questions Ethereum's high valuation based on negative revenue growth, profitability, and declining interest in NFTs.
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Analyst Views on NVDA
Wall Street analysts forecast NVDA stock price to rise
41 Analyst Rating
39 Buy
1 Hold
1 Sell
Strong Buy
Current: 220.780
Low
200.00
Averages
264.97
High
352.00
Current: 220.780
Low
200.00
Averages
264.97
High
352.00
About NVDA
NVIDIA Corporation is an artificial intelligence (AI) infrastructure company. The Company is engaged in accelerated computing to help solve the challenging computational problems. Its segments include Compute & Networking and Graphics. The Compute & Networking segment includes its Data Center accelerated computing and networking platforms and AI solutions and software, and automotive platforms and autonomous and electric vehicle solutions, including software. The Graphics segment includes GeForce GPUs for gaming and personal computers (PCs), and Quadro/NVIDIA RTX GPUs for enterprise workstation graphics. Its technology stack includes the foundational NVIDIA CUDA development platform that runs on all NVIDIA GPUs, as well as hundreds of domain-specific software libraries, frameworks, algorithms, software development kits (SDKs), and application programming interfaces (APIs). Its platforms address four markets, which include Data Center, Gaming, Professional Visualization, and Automotive.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Significant Sales Growth: Cerebras reported $510 million in sales last year, a notable increase from $290.3 million in 2024, indicating rapid growth in the AI infrastructure market.
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See More
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- Market Optimism: Nvidia is expected to report $78.8 billion in revenue and $1.77 EPS for Q1 FY2027, with prediction markets indicating a 90% probability of beating these expectations, reflecting strong bullish sentiment among investors.
- Analyst Forecasts Exceed Consensus: Goldman Sachs analyst James Schneider predicts Nvidia will surpass consensus revenue estimates by approximately $2 billion, with a Q2 revenue forecast of $87.7 billion, slightly above Wall Street's average, indicating robust growth potential.
- Surge in Customer Spending: Nvidia's largest data center clients are projected to spend over $700 billion on AI infrastructure in 2026, highlighting sustained demand for Nvidia's products and reinforcing its market position amid increasing capital expenditures from major tech players.
- Investment Strategy Recommendation: While optimistic about Nvidia's earnings, investors are advised to adopt a dollar-cost averaging strategy rather than making large bets before the earnings report, which mitigates risks and ensures long-term benefits from the AI infrastructure build-out.
See More
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- New Strategic Framework: Xi Jinping and Donald Trump agreed to a guiding framework of 'constructive China-U.S. relationship of strategic stability' for the next three years, indicating a willingness to manage competition while preventing escalation of tensions.
- Positive Pre-summit Outcomes: At the preparatory meeting in South Korea, trade envoys achieved 'overall balanced and positive outcomes,' with Xi emphasizing the need to maintain this momentum, reflecting China's openness to deeper U.S. commercial engagement.
- Areas for Deeper Cooperation: Xi called for better use of diplomatic and military communication channels while advocating for deeper cooperation in economic, trade, agriculture, and tourism sectors, highlighting the potential for multi-faceted collaboration between the two nations.
- Critical Taiwan Issue: Xi labeled Taiwan as 'the most important issue in U.S.-China relations,' warning that proper handling could stabilize relations while mishandling could lead to conflict, underscoring the sensitivity and complexity of the Taiwan situation.
See More
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- Trade Agreement Expectations: Goldman Sachs analysts noted that both sides might agree on increasing Chinese purchases of U.S. agricultural products, energy, and aircraft in exchange for avoiding further tariff escalations, which would positively impact U.S.-China trade relations.
- AI Chip Sales Breakthrough: Following the summit, Washington cleared sales of Nvidia's H200 AI chips to several major Chinese tech firms, including Alibaba and Tencent, marking a significant advancement for China's AI sector and potentially enhancing its global competitiveness.
- Cautious Market Reaction: Although the Hang Seng Tech Index saw a slight uptick, the overall market remains cautious, with investors waiting for the summit's outcomes while focusing on the potential for earnings growth among Chinese firms to guide future investment strategies.
See More
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- Stalled Technology Deal: Although the U.S. has cleared around 10 Chinese firms to purchase Nvidia's H200 chips, no deliveries have been made so far, leaving this significant technology deal in limbo and impacting Nvidia's strategic positioning in the Chinese market.
- Market Share Impact: Before U.S. export restrictions tightened, Nvidia commanded about 95% of China's advanced chip market, with China accounting for 13% of its revenue, indicating the critical importance of the Chinese market for Nvidia, as CEO Jensen Huang seeks breakthroughs during his trip.
- Potential Market Value: Huang has previously estimated that China's AI market alone would be worth $50 billion this year, highlighting the immense market potential that Nvidia needs to tap into to achieve its long-term growth objectives in the region.
- Purchase Limitations: Under U.S. licensing terms, each approved customer can purchase up to 75,000 H200 chips, with companies like Alibaba, Tencent, and ByteDance involved, reflecting the cautious approach of the U.S. in technology exports while providing limited market opportunities for Chinese firms.
See More
