🎁What the Tigers Say | Where Will NVIDIA Reach Before Earnings?

Nvidia's stock has climbed 30% from its recent low, but rumors of design flaws and shipment delays in its next-generation Blackwell chip, along with CEO Jensen Huang's share sales, have raised concerns about the company's short-term outlook.

As NVDA shares rise from below $100 to around $118, investors are questioning whether the upward trend will continue.

Below are some insights from Tigers @DerivTiger, @HMH, @HLPA and @jjkc. Which opinions do you agree with？

🎁Special Notes: Whoever showed up on the” What the Tigers Say” column will receive 100 Tiger Coins and an exclusive interview invitation to honor your contribution.

Click titles to read the full analysis:

1. @DerivTiger: Design Flaws, Delayed Shipments: Is NVIDIA's Chip in Trouble? Can We Still Expect the Month-End Financial Report?

Key Points:

• Recently, news about Nvidia's new generation Blackwell chip "failing" is everywhere, with some saying there are design flaws in the chip and others saying Blackwell's shipments are delayed. After global media and financial institutions' hype, the AI sector has already seen a significant pullback in the market.

• Firstly, rumors suggest that NVIDIA's basic b102 chip has design problems that require $Taiwan Semiconductor Manufacturing(TSM)$ to re-spin the wafer. According to industry insiders, TSMC identified the issue in mid-July and has since successfully re-spun the wafer. Although this will affect the shipment pace for this year, there is a possibility to recover some of the lost ground by expanding production by the end of the year and still achieve the planned large-scale shipments in 2025.

  

• In addition, the CoWoS-L packaging yield is only 60%, causing market concern, but some institutions believe the yield can reach around 90%. Even if the yield does not meet expectations, Nvidia can use the CoWoS-S packaging on lower-end product lines, which has slightly lower performance but better yield, greatly reducing the negative impact of yield on shipments.

• At last week's $SUPER MICRO COMPUTER INC(SMCI)$ financial report conference call, when analysts asked about the impact of Blackwell, SMCI stated that large-scale revenue from Blackwell is expected to be achieved in 2025, with only samples in the second half of 2024, confirming that Blackwell's shipments are about a quarter later than previously expected in Q4.

• We believe that although Nvidia currently has some short-term issues exposed, the overall demand and total sales volume of the Blackwell series are limitedly affected. At the same time, the demand for the older Hopper series is still strong, and Nvidia can reduce the negative impact of the delay by increasing supply. In addition, the expected price by analysts has not been affected by this.

  Data source: Bloomberg, compiled by Tiger Brokers

2. @HMH: The recent sale of Nvidia shares by CEO Jensen Huang might not necessarily be a cause for concern

Key Points:

• Insider Sales: Jensen Huang's sales were part of a pre-determined trading plan related to his compensation package, including restricted stock units (RSUs) and performance stock units (PSUs). This means the sales were planned and not necessarily a reflection of his outlook on Nvidia's future. As investors, it is important for us not to miss the forest for the trees and avoid reading too much into a relatively small move from Jensen Huang.

• Company Fundamentals: Nvidia remains a leader in the semiconductor industry, particularly in AI and gaming. The company's strong financial performance and market position suggest continued growth potential. Based on recent quarterly earnings call for Amazon, Alphabet, Meta and Microsoft, prospects for Blackwell remain very good.

• Regarding whether Nvidia will hold $100 in August, it is challenging to predict short-term price movements with certainty. However, I am hoping the price to hit $90 as that is my target price with margin of safety though given the company's strong fundamentals and positive analyst sentiment, it is plausible that Nvidia could maintain or exceed $100.

3. @HLPA: Where Will NVIDIA Reach Before Earnings?

Key Points:

• CEO Jensen Huang sold but only a tiny fraction of what he owns, hence no fear that the sale would cause a rush to sell the shares. This has been shown in the trading sessions following the sale by the CEO.

• From a low of below 100 and rising now to hit 116ish, NVDA shares will continue to climb upwards to sail pass 120.

• But be warned thoigh as share prices do not shoot straight up all the time. Prepare for a short correction as profit takers start to realise their gains. Allow the share price to correct downwards and then pick them up again. I have made quite a bundle buying each rime on the dips and would continue to do so.

• I am waiting for the 108 support level as it may be touched when "buy on the rumour, sell on the news" kick in. Do not fear buying this giant of a stock.

4. @jjkc:

Questions for you:

Where Will NVIDIA Reach Before Earnings?

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⏰Duration

• 21 August (24pm EDT)