Nvidia Is Always a favorite stock

Why I Like Nvidia

• Revenue growth has been outstanding over the past five years, suggesting that the company is capturing significant market share during this period.
• Earnings per share (EPS) have significantly outperformed competitors, with an annual increase of 86% over the last five years.
• Projected revenue growth for the next 12 months is strong and indicates that the company’s market share is likely to continue rising.

Why should you consider buying Nvidia right now?

• Nvidia is currently trading at $136.52 per share, reflecting a forward price-to-earnings ratio of 36.2x. While many semiconductor companies may have lower valuation multiples, Nvidia’s price is justified given the quality of its business.
• While the entry price may seem important initially, our analysis consistently demonstrates that long-term market outperformance is driven more by the quality of the business than by simply securing a bargain on a stock.

Understanding Product Demand and Managing Inventory Effectively

Days Inventory Outstanding (DIO) is a crucial metric for chipmakers because it indicates the capital intensity of a business and highlights the cyclical nature of semiconductor supply and demand. In a tight supply environment, inventories usually remain stable, enabling chipmakers to maintain pricing power. However, a steady increase in DIO can signal weak demand. If inventories continue to rise, the company may need to reduce production.