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- ABplusABplus
  ·2022-08-30
  Great info
  The True Bargain In Big Tech Semiconductors: Micron
  SummaryMicron is in a class by itself for low semiconductor-industry valuations, with a bright long-
  The True Bargain In Big Tech Semiconductors: Micron
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- ABplusABplus
  ·2022-08-29
  Saw great increase in BABA price last week. 88 to 94.
  U.S.-China Relations Just Got a Whole Lot Better, Boosting the Prospects of These Three Stocks
  If you are laser-focused on inflation and the Federal Reserve’s policy, you might have missed a key
  U.S.-China Relations Just Got a Whole Lot Better, Boosting the Prospects of These Three Stocks
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- ABplusABplus
  ·2022-08-26
  Now what Nvidia?
  Earnings Analysis| Nvidia 3 Quarters' Exile
  @Value_investing：
  $NVIDIA Corp(NVDA)$ released its official fiscal year 2023 second-quarter report, corresponding to the natural day for the quarter ended July 31 results.On August 8, Nvidia had issued a second quarterly report warning. Therefore, the market knows the core financial data, investors focus on the three quarterly guidance and results will be.Worse Than Expected EarningsBloomberg analysts' forecast for third-quarter revenue was $6.4 billion, down 9% yoy. NVIDIA's results were worse than the market forecast.As a result, Nvidia plunged to $164 after the bell following the earnings announcement.As noted in previous analysis, Nvidia's third-quarter guidance is worse than the second quarter, with expected revenue size of $5.
  Earnings Analysis| Nvidia 3 Quarters' Exile
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- ABplusABplus
  ·2022-08-26
  But Nvidia Graphic cards are still expensive 😃
  Nvidia Stock: Get Out Now
  SummaryNvidia reported horrible Q2 numbers and provided disappointing guidance for the next quarter.
  Nvidia Stock: Get Out Now
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Inlate May here, I mentioned the “value trap” situation for <b>Intel</b>(INTC). Basically, what most analysts and turnaround investors considered a bargain valuation was destined to fall even lower in price as actual operating business results were weakening dramatically. So, which stock is a bargain in the Big Tech semiconductor space, if any?</p><p>My answer is <b>Micron Technology</b>(NASDAQ:MU), one of the largest memory chip makers in the world, which may in fact be worthwhile to own going into September 2022. When you dig deeper and compare valuation numbers (withanalysts projecting a weakDRAM and NAND memory selling market until the summer of 2023) to both its 10-year past and the expensive setups of other large chip makers today, MU is close to tipping into true bargain territory. If you are a value or<i>growth at a reasonable price</i>[GARP] investor, purchasing this well-managed, strongly positioned blue-chip in the technology sector could help out portfolio returns in the years ahead. An added catalyst for investors is the U.S. government is offering tax breaks and other incentives in the<i>CHIPS and Science Act</i>passed this summer. Micron hascommitted to spend $40 billionon new American-based manufacturing capacity, creating up to 40,000 jobs.</p><h2><img src=\"https://static.tigerbbs.com/6b50fda7e112b42fea37113b510ab62c\" tg-width=\"640\" tg-height=\"231\" referrerpolicy=\"no-referrer\" width=\"100%\" height=\"auto\"/><b>Valuation Story</b></h2><p>While NVIDIA is clearly the most expensive major semiconductor name in U.S. trading (especially if chip sales are turning lower in a recession), Micron may be the cheapest in the group, at least from my vantage point. On a variety of calculations, Intel and Micron appear to have similar valuation setups. However, unlike INTC, MU’s low valuation is NOT matched against an imploding revenue and income future. My research conclusion is Micron should be owned before most other semiconductor companies are added to your portfolio, if risk-adjusted analysis is important to you.</p><p>Looking back over 10 years of data, price to trailing earnings, sales, cash flow, and book value highlight a valuation already lower than usual. While price to sales is around long-term averages, most semiconductor companies are selling at massive premiums to the recent past, even after the 2022 bear market in Big Tech. Price is approaching accounting book value, nearing its lowest number since 2016. And, valuations on income and cash flow are well-below normal today.</p><p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/73c56af01de9f087babfe9211dfd4f12\" tg-width=\"635\" tg-height=\"467\" width=\"100%\" height=\"auto\"/><span>YCharts, Micron - Fundamental Ratios, 10 Years</span></p><p>Price to trailing free cash flow of 13.7x is “the” bargain choice vs. its largest semiconductor peers and sometimes competitors. Below is a graph of this idea vs. Intel, <b>Advanced Micro Devices</b>(AMD), NVIDIA, <b>Broadcom</b>(AVGO), <b>Marvell Technology</b>(MRVL), <b>Texas Instruments</b>(TXN), <b>NXP Semiconductors</b>(NXPI), <b>Qualcomm</b>(QCOM), and <b>Analog Devices</b>(ADI).</p><p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/0cf3648322e9fa611e8b9195373f14d7\" tg-width=\"635\" tg-height=\"569\" width=\"100%\" height=\"auto\"/><span>YCharts, Micron Peers - Trailing Price to Free Cash Flow, 1 Year</span></p><p>But the valuation news gets even better, when you incorporate balance sheet debt and cash holdings. Micron owned $10 billion in cash and $22.7 billion in total current assets at the end of June against $6 billion in debt and $16 billion in total liabilities. The positive effect on enterprise value calculations is today’s $64 billion in equity market value, which can be reduced based on the large net cash stash. So, EV to EBITDA (total cash flow generation using earnings before interest, taxes, depreciation and amortization) and EV to Revenue numbers are even less expensive than simple stock price comparisons. Reviewing 35 years of information, Micron’s EV to trailing EBITDA ratio of 3.5x is HALF of its long-term average (including recessions, wars, booms and busts). In addition, EV to trailing Revenues is a solid 30% discount to decades of history.</p><p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/280d203998d0168ef38e8f4c310c5e2e\" tg-width=\"635\" tg-height=\"433\" width=\"100%\" height=\"auto\"/><span>YCharts, Micron - EV Ratios, 35 Years</span></p><p>Enterprise value multiples are also a great financial exercise to more accurately compare companies with different management styles and leverage uses on an equal playing field, apples-to-apples for metrics. And, since Wall Street is more concerned about future results, we can take a look at “forward” estimates by analysts as part of our EV research (which include a slowdown in Micron’s businesses).</p><p>Perhaps the real eye-opening stat on Micron’s present valuation is found in EV to forward EBITDA data, graphed below. A projected 3.7x ratio is wickedly lower than a median peer group average of 12x, and mean average of 16.3x. Sure, you can argue memory chips sales and margins are more cyclical in nature than other semi-names, with operating losses occurring once every 5-7 years for the company. But, the typical semiconductor firm is selling for a large premium EV to EBITDA reading on the COVID-19 pandemic-related shortages of product. To honestly believe MU’s outlier number is appropriate, you have to also believe memory chips are on the way out for a technology, replaced with something better for all of our gadgets and machines.</p><p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/520ea880a7b2f87e1457ba46053e2aca\" tg-width=\"635\" tg-height=\"569\" width=\"100%\" height=\"auto\"/><span>YCharts, Micron Peers - EV To Forward EBITDA</span></p><p>Again, the EV to forward Revenue projection of 2x is nowhere near industry norms. It’s even lower than Intel’s 2.3x. Measured at a median average discount of 60% vs. the peer group and 70% discount to the mean average, investors hunting for bargains have found a target worthy of purchase.</p><p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/413caf93446eade36d5ac99a2db16035\" tg-width=\"635\" tg-height=\"569\" width=\"100%\" height=\"auto\"/><span>YCharts, Micron Peers - EV To Forward Revenues</span></p><p>Taken together, the low valuation stats, alongside an approximate industry-normal EPS growth forecast between late 2021 and the middle of 2024 (pictured below), create a hard to ignore buy proposition.</p><h2><p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/0be830167e548944421dc216537f4b46\" tg-width=\"635\" tg-height=\"569\" width=\"100%\" height=\"auto\"/><span>YCharts, Micron Peers - EPS Estimates to Late 2024</span></p><b>Technical Trading Picture</b></h2><p>I know investing during bear markets is tough. It’s definitely a different animal than bull markets when it comes to buy decisions, as upside momentum is usually absent in blue chips. I would categorize the -40% Micron decline in price since January as lacking any real sell intensity. If appears to be one centered around the general Big Tech plunge, as industry sales growth slows and interest rates rise (a double whammy knocking price from extended overvaluations).</p><p>For MU specifically, the<i>Accumulation/Distribution Line</i>,<i>Negative Volume Index</i>, and<i>On Balance Volume</i>may have all reached bottoms already. All three have not declined materially over the past year, while they have perked up since late June. If these indicators remain steady while price dips below $50 in coming months, a technically-derived strong buy situation could materialize (on positive momentum divergences vs. a new price low).</p><h2><p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/0e60677c762daf3cfe870ffae8f0dfa4\" tg-width=\"700\" tg-height=\"639\" width=\"100%\" height=\"auto\"/><span>StockCharts.com - Micron, 1-Year Chart of Daily Values</span></p><b>Final Thoughts</b></h2><p>If valuations matter as an investor (which they should if you own stocks for years or decades), buying Micron at a forward EV to EBITDA number of 3.7x is a completely different position than NVIDIA at 55x. As an owner, I would much rather receive huge upfront cash flow and income in a company riding a long-term demographic uptrend in memory chips, than gamble on a projected high-growth gaming/crypto-mining/AI future that appears to be faltering.</p><p>Does buying a true bargain in Big Tech guarantee positive investment gains right away? No, but it increases the odds of a large advance after the economy recovers from its recent slowdown (recession). Honestly, Micron could easily dip below $50 a share if hit by another bearish selling wave on Wall Street during the autumn. It may even fall below $40 in a stock market crash scenario. Yet, the odds favoring real “outperformance” of Big Tech names are approaching, either through smaller than average losses or stronger gains over time.</p><p>With interest rates still rising, and America’s inflation future still cloudy and hard to predict, a recession in the economy and memory chip demand overall (including weaker PC sales) may mean patience will be key when investing in Micron. A significant investment payoff may not occur until next summer, for example. If you want to reduce capital risk entering MU shares, a cost-average plan over the next 3-6 months may be the best accumulation approach.</p><p>You can purchase a small starter position at $57 now, then double your stake in two months, and double it again in four months near the beginning of 2023. This plan gives you upside potential right away, with a serious stake (perhaps at lower than current pricing for net cost) ready for a rebound in the second half of next year. Remember, stock price changes tend to look forward by 3-6 months. My best guess is price will bottom between September and December preparing for a stronger operating environment at Micron by the summertime.</p></body></html>","collect":0,"html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>The True Bargain In Big Tech Semiconductors: Micron</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nThe True Bargain In Big Tech Semiconductors: Micron\n</h2>\n\n<h4 class=\"meta\">\n\n\n2022-08-30 12:05 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://seekingalpha.com/article/4537696-the-true-bargain-in-big-tech-semiconductors-micron><strong>Seeking Alpha</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>SummaryMicron is in a class by itself for low semiconductor-industry valuations, with a bright long-term operating future.If the cyclical memory chip market rebounds before next summer, an important ...</p>\n\n<a href=\"https://seekingalpha.com/article/4537696-the-true-bargain-in-big-tech-semiconductors-micron\">Web Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"","relate_stocks":{"MU":"美光科技"},"source_url":"https://seekingalpha.com/article/4537696-the-true-bargain-in-big-tech-semiconductors-micron","is_english":true,"share_image_url":"https://static.laohu8.com/e9f99090a1c2ed51c021029395664489","article_id":"1147997487","content_text":"SummaryMicron is in a class by itself for low semiconductor-industry valuations, with a bright long-term operating future.If the cyclical memory chip market rebounds before next summer, an important price bottom for MU is approaching.Intelligent investors should create a full position utilizing a cost-average buy plan over the next 3-6 months.I wrote afew weeks ago hereabout the horrible and extended valuation setup working against NVIDIA(NVDA) investors. Inlate May here, I mentioned the “value trap” situation for Intel(INTC). Basically, what most analysts and turnaround investors considered a bargain valuation was destined to fall even lower in price as actual operating business results were weakening dramatically. So, which stock is a bargain in the Big Tech semiconductor space, if any?My answer is Micron Technology(NASDAQ:MU), one of the largest memory chip makers in the world, which may in fact be worthwhile to own going into September 2022. When you dig deeper and compare valuation numbers (withanalysts projecting a weakDRAM and NAND memory selling market until the summer of 2023) to both its 10-year past and the expensive setups of other large chip makers today, MU is close to tipping into true bargain territory. If you are a value orgrowth at a reasonable price[GARP] investor, purchasing this well-managed, strongly positioned blue-chip in the technology sector could help out portfolio returns in the years ahead. An added catalyst for investors is the U.S. government is offering tax breaks and other incentives in theCHIPS and Science Actpassed this summer. Micron hascommitted to spend $40 billionon new American-based manufacturing capacity, creating up to 40,000 jobs.Valuation StoryWhile NVIDIA is clearly the most expensive major semiconductor name in U.S. trading (especially if chip sales are turning lower in a recession), Micron may be the cheapest in the group, at least from my vantage point. On a variety of calculations, Intel and Micron appear to have similar valuation setups. However, unlike INTC, MU’s low valuation is NOT matched against an imploding revenue and income future. My research conclusion is Micron should be owned before most other semiconductor companies are added to your portfolio, if risk-adjusted analysis is important to you.Looking back over 10 years of data, price to trailing earnings, sales, cash flow, and book value highlight a valuation already lower than usual. While price to sales is around long-term averages, most semiconductor companies are selling at massive premiums to the recent past, even after the 2022 bear market in Big Tech. Price is approaching accounting book value, nearing its lowest number since 2016. And, valuations on income and cash flow are well-below normal today.YCharts, Micron - Fundamental Ratios, 10 YearsPrice to trailing free cash flow of 13.7x is “the” bargain choice vs. its largest semiconductor peers and sometimes competitors. Below is a graph of this idea vs. Intel, Advanced Micro Devices(AMD), NVIDIA, Broadcom(AVGO), Marvell Technology(MRVL), Texas Instruments(TXN), NXP Semiconductors(NXPI), Qualcomm(QCOM), and Analog Devices(ADI).YCharts, Micron Peers - Trailing Price to Free Cash Flow, 1 YearBut the valuation news gets even better, when you incorporate balance sheet debt and cash holdings. Micron owned $10 billion in cash and $22.7 billion in total current assets at the end of June against $6 billion in debt and $16 billion in total liabilities. The positive effect on enterprise value calculations is today’s $64 billion in equity market value, which can be reduced based on the large net cash stash. So, EV to EBITDA (total cash flow generation using earnings before interest, taxes, depreciation and amortization) and EV to Revenue numbers are even less expensive than simple stock price comparisons. Reviewing 35 years of information, Micron’s EV to trailing EBITDA ratio of 3.5x is HALF of its long-term average (including recessions, wars, booms and busts). In addition, EV to trailing Revenues is a solid 30% discount to decades of history.YCharts, Micron - EV Ratios, 35 YearsEnterprise value multiples are also a great financial exercise to more accurately compare companies with different management styles and leverage uses on an equal playing field, apples-to-apples for metrics. And, since Wall Street is more concerned about future results, we can take a look at “forward” estimates by analysts as part of our EV research (which include a slowdown in Micron’s businesses).Perhaps the real eye-opening stat on Micron’s present valuation is found in EV to forward EBITDA data, graphed below. A projected 3.7x ratio is wickedly lower than a median peer group average of 12x, and mean average of 16.3x. Sure, you can argue memory chips sales and margins are more cyclical in nature than other semi-names, with operating losses occurring once every 5-7 years for the company. But, the typical semiconductor firm is selling for a large premium EV to EBITDA reading on the COVID-19 pandemic-related shortages of product. To honestly believe MU’s outlier number is appropriate, you have to also believe memory chips are on the way out for a technology, replaced with something better for all of our gadgets and machines.YCharts, Micron Peers - EV To Forward EBITDAAgain, the EV to forward Revenue projection of 2x is nowhere near industry norms. It’s even lower than Intel’s 2.3x. Measured at a median average discount of 60% vs. the peer group and 70% discount to the mean average, investors hunting for bargains have found a target worthy of purchase.YCharts, Micron Peers - EV To Forward RevenuesTaken together, the low valuation stats, alongside an approximate industry-normal EPS growth forecast between late 2021 and the middle of 2024 (pictured below), create a hard to ignore buy proposition.YCharts, Micron Peers - EPS Estimates to Late 2024Technical Trading PictureI know investing during bear markets is tough. It’s definitely a different animal than bull markets when it comes to buy decisions, as upside momentum is usually absent in blue chips. I would categorize the -40% Micron decline in price since January as lacking any real sell intensity. If appears to be one centered around the general Big Tech plunge, as industry sales growth slows and interest rates rise (a double whammy knocking price from extended overvaluations).For MU specifically, theAccumulation/Distribution Line,Negative Volume Index, andOn Balance Volumemay have all reached bottoms already. All three have not declined materially over the past year, while they have perked up since late June. If these indicators remain steady while price dips below $50 in coming months, a technically-derived strong buy situation could materialize (on positive momentum divergences vs. a new price low).StockCharts.com - Micron, 1-Year Chart of Daily ValuesFinal ThoughtsIf valuations matter as an investor (which they should if you own stocks for years or decades), buying Micron at a forward EV to EBITDA number of 3.7x is a completely different position than NVIDIA at 55x. As an owner, I would much rather receive huge upfront cash flow and income in a company riding a long-term demographic uptrend in memory chips, than gamble on a projected high-growth gaming/crypto-mining/AI future that appears to be faltering.Does buying a true bargain in Big Tech guarantee positive investment gains right away? No, but it increases the odds of a large advance after the economy recovers from its recent slowdown (recession). Honestly, Micron could easily dip below $50 a share if hit by another bearish selling wave on Wall Street during the autumn. It may even fall below $40 in a stock market crash scenario. Yet, the odds favoring real “outperformance” of Big Tech names are approaching, either through smaller than average losses or stronger gains over time.With interest rates still rising, and America’s inflation future still cloudy and hard to predict, a recession in the economy and memory chip demand overall (including weaker PC sales) may mean patience will be key when investing in Micron. A significant investment payoff may not occur until next summer, for example. If you want to reduce capital risk entering MU shares, a cost-average plan over the next 3-6 months may be the best accumulation approach.You can purchase a small starter position at $57 now, then double your stake in two months, and double it again in four months near the beginning of 2023. This plan gives you upside potential right away, with a serious stake (perhaps at lower than current pricing for net cost) ready for a rebound in the second half of next year. Remember, stock price changes tend to look forward by 3-6 months. My best guess is price will bottom between September and December preparing for a stronger operating environment at Micron by the summertime.","news_type":1},"isVote":1,"tweetType":1,"viewCount":229,"authorTweetTopStatus":1,"verified":2,"comments":[],"imageCount":0,"langContent":"EN","totalScore":0},{"id":9997933516,"gmtCreate":1661732283837,"gmtModify":1676536567944,"author":{"id":"4122632689447802","authorId":"4122632689447802","name":"ABplus","avatar":"https://community-static.tradeup.com/news/36e8f410f508cbaf7b19413f9aeb9a3f","crmLevel":2,"crmLevelSwitch":0,"followedFlag":false,"idStr":"4122632689447802","authorIdStr":"4122632689447802"},"themes":[],"htmlText":"Saw great increase in BABA price last week. 88 to 94.&nbsp;","listText":"Saw great increase in BABA price last week. 88 to 94.&nbsp;","text":"Saw great increase in BABA price last week. 88 to 94.","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":1,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/9997933516","repostId":"1195739543","repostType":2,"repost":{"id":"1195739543","kind":"news","pubTimestamp":1661729403,"share":"https://ttm.financial/m/news/1195739543?lang=&edition=fundamental","pubTime":"2022-08-29 07:30","market":"us","language":"en","title":"U.S.-China Relations Just Got a Whole Lot Better, Boosting the Prospects of These Three Stocks","url":"https://stock-news.laohu8.com/highlight/detail?id=1195739543","media":"MarketWatch","summary":"If you are laser-focused on inflation and the Federal Reserve’s policy, you might have missed a key ","content":"<html><head></head><body><p><img src=\"https://static.tigerbbs.com/90e5447f11a18a6732056ae26574638c\" tg-width=\"700\" tg-height=\"466\" referrerpolicy=\"no-referrer\" width=\"100%\" height=\"auto\"/>If you are laser-focused on inflation and the Federal Reserve’s policy, you might have missed a key breakthrough in U.S.-China relations that will boost U.S.-listed China stocks over the next six months.</p><p>My three favorites are Yum ChinaYUMC,-1.12%,AlibabaBABA,-1.89%and BeiGeneBGNE,+2.92%.I will get into details on why, below.</p><p>But first, here’s the background on this important geopolitical development for context, thanks to help from China expert Brad Loncar. He’s the creator of the Loncar China BioPharma exchange traded fundCHNA,+0.50%,which offers a way to get broad exposure to China biopharma companies. (You can read more about the ETFhere.)</p><h2><b>The ghost of Enron</b></h2><p>Years ago, after the tech bubble blew up in 2000, U.S. auditing firms came under heavy fire for not reporting publicly on the accounting shenanigans that cost investors tons of money — including at the meltdown poster child of the era, Enron. In response, Congress set up an auditor of auditors known as the Public Company Accounting Oversight Board (PCAOB).</p><p>China’s government never gave U.S. inspectors a peek at the books of Chinese businesses, for fear of revealing state secrets at its big state-run companies. A few years ago, Congress said enough is enough and passed a law saying Chinese companies will get kicked off U.S. exchanges if they don’t play along soon.</p><p>A standoff ensued, which just ended Aug. 26 when the China Securities Regulatory Commission and the U.S. Securities and Exchange Commission (SEC) agreed on audit protocols.</p><p>“I always believed they would reach an agreement because it is not in China’s interest to lose access to the world’s largest financial market,” says Loncar.</p><p>But the devil is in the details. So it remains to be seen how much cooperation U.S. regulators get later this year when they try to carry out inspections.</p><p>“There is still a question of whether these audits will go smoothly,” says Loncar, echoing cautionary SEC comments.</p><p>The agreement will be meaningful “only if the PCAOB actually can inspect and investigate completely audit firms in China,” cautions SEC Chair Gary Gensler.</p><p>Tools for Investing SuccessUnderstand how today’s business practices, market dynamics, tax policies and more impact you with real-time news and analysis from MarketWatch.SUBSCRIBE NOW</p><p>This is still an overhang for U.S.-listed Chinese stocks since no one knows the outcome for sure. But, like Loncar, I believe it will work out.</p><p>“As controversial as China is,” says Loncar, the breakthrough this week “is a sign that China still wants to be a part of the global financial community.”</p><p>It seems unlikely China would signal cooperation, only to reverse course down the road. As this becomes clear later this year when U.S. inspectors attempt audits, it should boost U.S.-listed Chinese companies.</p><p>Here are three of my favorites.</p><h2><b>Yum China</b></h2><p>If the U.S. ever needed a brand ambassador to win favor with everyday Chinese citizens, it could do worse than nominate Yum. Its KFC and Pizza Hut outlets are incredibly popular there. Now Yum is in the process of rolling out Taco Bells. Yum is also developing several emerging brands that it owns outright.</p><p>All of this makes Yum China the largest restaurant company in China. It operates over 12,000 outlets in 1,700 cities, including 8,400 KFCs and 2,600 Pizza Huts.</p><p>Owning Yum is more than a bet that a thorny international accounting issue gets resolved. It’s also a wager that Covid is finally retreating into the background — to circulate in various, less pathogenic forms, as the Spanish Flu became. That one still circulates every year but hardly anyone notices, because it has become so much tamer. This is how flu viruses evolve, and if Covid continues to take the same path, it will boost Yum China sales.</p><p>Earlier this year, Yum had to close over half its restaurants because of China’s lockdown. First-quarter same-store sales decreased 8%, and profit margins slipped.</p><p>Yum also benefits from growing disposable incomes in China. People dine out when they make more money.</p><h2><b>Alibaba</b></h2><p>Like Yum, China’s retail, cloud-computing and media giant Alibaba is suffering from the country’s Covid lockdown-related economic malaise.</p><p>“Everybody understands China is at a different point in the economic cycle than the rest of the world,” says Justin White, manager of the T. Rowe Price All-Cap Opportunities FundPRWAX,-3.08%.But as China’s economy recovers because Covid recedes, Alibaba could get a boost, says White. That’s one reason he recently took a position in the Chinese internet giant.</p><p>“Economically, China could be improving in 2023 when rest of world is not,” says White. “Alibaba’s fundamentals are more likely to improve than decelerate.”</p><p>White is worth listening to because his fund beats his Morningstar Direct category and benchmark index by several percentage points over the last three years.</p><p>Meanwhile, Alibaba continues to invest in international e-commerce platforms to drive long-term growth, says Morningstar Direct analyst Chelsey Tam, who has a five-star rating (out of a possible five stars) on the stock.</p><p>Larry McDonald, who pens the Bear Traps Report, singles out Alibaba as a favorite, for technical reasons. He notes the China Golden Dragon Equity Index recently re-tested its year-long downtrend line from above and rebounded sharply.</p><p>“We see a breakout to the upside in China equities in the coming weeks,” he  says. “Clearly there was wash-out capitulation-selling in these names in March. This latest leg down is another bite at the apple. We expect dramatic outperformance relative to U.S. equities in the coming months.”</p><h2><b>BeiGene</b></h2><p>BeiGene is a giant cancer-therapy company with a twist. It has a big presence in China, where it serves as a gateway for other large biopharma companies that want to sell therapies there — like AmgenAMGN,-2.05%and Bristol-Myers SquibbBMY,-0.43%.In all, BeiGene has the rights to distribute 13 approved drugs in China.</p><p>This makes the company’s stock particularly sensitive to the ebb and flow of U.S.-China geopolitical tensions. So, when, or if, the accounting issue gets decisively resolved, perhaps in December, the stock should get another lift. A big company like BeiGene needs access to U.S. capital markets.</p><p>BeiGene is far more than a drug-import conduit. Second-quarter revenue grew 120% to $304 million, thanks to rapid growth in sales of cancer therapies it developed, Brukinsa and Tislelizumab. Behind the scenes, BeiGene has nearly 80 ongoing and planned clinical trials in over 40 drug candidates. More than 30 of these are end-stage “pivotal” trials. This means they could provide the data needed to apply for approvals. Its broad pipeline covers 80% of the world’s cancers.</p><p>Accounting-firm problems aren’t the only overhang here, notes Loncar. The company has manufacturing and research facilities in New Jersey, but it also has manufacturing plants in China. In July, the Food and Drug Administration (FDA) tabled approval of a biologics license application for the use of Tislelizumab in the U.S., citing an inability to inspect Chinese plants.</p><p>If China continues to lift its lockdowns because Covid recedes, FDA inspectors may be able to get in and give the green light. Of course, with the FDA, you never really know what issues might pop up, so there’s no guarantee this is the only problem for Tislelizumab approval in  the U.S.</p><p>But the tone of company commentary on the matter suggests this may be the case. “The FDA cited only the inability to complete inspections due to restrictions on travel as the reason for the deferral,” says BeiGene, which offered no timeline on when this issue might be resolved.</p><p>BeiGene is founder-run, often a plus in investing. CEO and Chairman John Oyler is a co-founder. It also has research collaborations with big names in the space like Amgen and NovartisNVS,-0.88%.This serves as a stamp of approval in my system of analyzing biotech companies.</p></body></html>","source":"lsy1603348471595","collect":0,"html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>U.S.-China Relations Just Got a Whole Lot Better, Boosting the Prospects of These Three Stocks</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nU.S.-China Relations Just Got a Whole Lot Better, Boosting the Prospects of These Three Stocks\n</h2>\n\n<h4 class=\"meta\">\n\n\n2022-08-29 07:30 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://www.marketwatch.com/story/u-s-china-relations-just-got-a-whole-lot-better-boosting-the-prospects-of-these-three-stocks-11661682894?mod=home-page><strong>MarketWatch</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>If you are laser-focused on inflation and the Federal Reserve’s policy, you might have missed a key breakthrough in U.S.-China relations that will boost U.S.-listed China stocks over the next six ...</p>\n\n<a href=\"https://www.marketwatch.com/story/u-s-china-relations-just-got-a-whole-lot-better-boosting-the-prospects-of-these-three-stocks-11661682894?mod=home-page\">Web Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"","relate_stocks":{"BABA":"阿里巴巴","YUMC":"百胜中国","BGNE":"百济神州"},"source_url":"https://www.marketwatch.com/story/u-s-china-relations-just-got-a-whole-lot-better-boosting-the-prospects-of-these-three-stocks-11661682894?mod=home-page","is_english":true,"share_image_url":"https://static.laohu8.com/e9f99090a1c2ed51c021029395664489","article_id":"1195739543","content_text":"If you are laser-focused on inflation and the Federal Reserve’s policy, you might have missed a key breakthrough in U.S.-China relations that will boost U.S.-listed China stocks over the next six months.My three favorites are Yum ChinaYUMC,-1.12%,AlibabaBABA,-1.89%and BeiGeneBGNE,+2.92%.I will get into details on why, below.But first, here’s the background on this important geopolitical development for context, thanks to help from China expert Brad Loncar. He’s the creator of the Loncar China BioPharma exchange traded fundCHNA,+0.50%,which offers a way to get broad exposure to China biopharma companies. (You can read more about the ETFhere.)The ghost of EnronYears ago, after the tech bubble blew up in 2000, U.S. auditing firms came under heavy fire for not reporting publicly on the accounting shenanigans that cost investors tons of money — including at the meltdown poster child of the era, Enron. In response, Congress set up an auditor of auditors known as the Public Company Accounting Oversight Board (PCAOB).China’s government never gave U.S. inspectors a peek at the books of Chinese businesses, for fear of revealing state secrets at its big state-run companies. A few years ago, Congress said enough is enough and passed a law saying Chinese companies will get kicked off U.S. exchanges if they don’t play along soon.A standoff ensued, which just ended Aug. 26 when the China Securities Regulatory Commission and the U.S. Securities and Exchange Commission (SEC) agreed on audit protocols.“I always believed they would reach an agreement because it is not in China’s interest to lose access to the world’s largest financial market,” says Loncar.But the devil is in the details. So it remains to be seen how much cooperation U.S. regulators get later this year when they try to carry out inspections.“There is still a question of whether these audits will go smoothly,” says Loncar, echoing cautionary SEC comments.The agreement will be meaningful “only if the PCAOB actually can inspect and investigate completely audit firms in China,” cautions SEC Chair Gary Gensler.Tools for Investing SuccessUnderstand how today’s business practices, market dynamics, tax policies and more impact you with real-time news and analysis from MarketWatch.SUBSCRIBE NOWThis is still an overhang for U.S.-listed Chinese stocks since no one knows the outcome for sure. But, like Loncar, I believe it will work out.“As controversial as China is,” says Loncar, the breakthrough this week “is a sign that China still wants to be a part of the global financial community.”It seems unlikely China would signal cooperation, only to reverse course down the road. As this becomes clear later this year when U.S. inspectors attempt audits, it should boost U.S.-listed Chinese companies.Here are three of my favorites.Yum ChinaIf the U.S. ever needed a brand ambassador to win favor with everyday Chinese citizens, it could do worse than nominate Yum. Its KFC and Pizza Hut outlets are incredibly popular there. Now Yum is in the process of rolling out Taco Bells. Yum is also developing several emerging brands that it owns outright.All of this makes Yum China the largest restaurant company in China. It operates over 12,000 outlets in 1,700 cities, including 8,400 KFCs and 2,600 Pizza Huts.Owning Yum is more than a bet that a thorny international accounting issue gets resolved. It’s also a wager that Covid is finally retreating into the background — to circulate in various, less pathogenic forms, as the Spanish Flu became. That one still circulates every year but hardly anyone notices, because it has become so much tamer. This is how flu viruses evolve, and if Covid continues to take the same path, it will boost Yum China sales.Earlier this year, Yum had to close over half its restaurants because of China’s lockdown. First-quarter same-store sales decreased 8%, and profit margins slipped.Yum also benefits from growing disposable incomes in China. People dine out when they make more money.AlibabaLike Yum, China’s retail, cloud-computing and media giant Alibaba is suffering from the country’s Covid lockdown-related economic malaise.“Everybody understands China is at a different point in the economic cycle than the rest of the world,” says Justin White, manager of the T. Rowe Price All-Cap Opportunities FundPRWAX,-3.08%.But as China’s economy recovers because Covid recedes, Alibaba could get a boost, says White. That’s one reason he recently took a position in the Chinese internet giant.“Economically, China could be improving in 2023 when rest of world is not,” says White. “Alibaba’s fundamentals are more likely to improve than decelerate.”White is worth listening to because his fund beats his Morningstar Direct category and benchmark index by several percentage points over the last three years.Meanwhile, Alibaba continues to invest in international e-commerce platforms to drive long-term growth, says Morningstar Direct analyst Chelsey Tam, who has a five-star rating (out of a possible five stars) on the stock.Larry McDonald, who pens the Bear Traps Report, singles out Alibaba as a favorite, for technical reasons. He notes the China Golden Dragon Equity Index recently re-tested its year-long downtrend line from above and rebounded sharply.“We see a breakout to the upside in China equities in the coming weeks,” he  says. “Clearly there was wash-out capitulation-selling in these names in March. This latest leg down is another bite at the apple. We expect dramatic outperformance relative to U.S. equities in the coming months.”BeiGeneBeiGene is a giant cancer-therapy company with a twist. It has a big presence in China, where it serves as a gateway for other large biopharma companies that want to sell therapies there — like AmgenAMGN,-2.05%and Bristol-Myers SquibbBMY,-0.43%.In all, BeiGene has the rights to distribute 13 approved drugs in China.This makes the company’s stock particularly sensitive to the ebb and flow of U.S.-China geopolitical tensions. So, when, or if, the accounting issue gets decisively resolved, perhaps in December, the stock should get another lift. A big company like BeiGene needs access to U.S. capital markets.BeiGene is far more than a drug-import conduit. Second-quarter revenue grew 120% to $304 million, thanks to rapid growth in sales of cancer therapies it developed, Brukinsa and Tislelizumab. Behind the scenes, BeiGene has nearly 80 ongoing and planned clinical trials in over 40 drug candidates. More than 30 of these are end-stage “pivotal” trials. This means they could provide the data needed to apply for approvals. Its broad pipeline covers 80% of the world’s cancers.Accounting-firm problems aren’t the only overhang here, notes Loncar. The company has manufacturing and research facilities in New Jersey, but it also has manufacturing plants in China. In July, the Food and Drug Administration (FDA) tabled approval of a biologics license application for the use of Tislelizumab in the U.S., citing an inability to inspect Chinese plants.If China continues to lift its lockdowns because Covid recedes, FDA inspectors may be able to get in and give the green light. Of course, with the FDA, you never really know what issues might pop up, so there’s no guarantee this is the only problem for Tislelizumab approval in  the U.S.But the tone of company commentary on the matter suggests this may be the case. “The FDA cited only the inability to complete inspections due to restrictions on travel as the reason for the deferral,” says BeiGene, which offered no timeline on when this issue might be resolved.BeiGene is founder-run, often a plus in investing. CEO and Chairman John Oyler is a co-founder. It also has research collaborations with big names in the space like Amgen and NovartisNVS,-0.88%.This serves as a stamp of approval in my system of analyzing biotech companies.","news_type":1},"isVote":1,"tweetType":1,"viewCount":207,"authorTweetTopStatus":1,"verified":2,"comments":[],"imageCount":0,"langContent":"EN","totalScore":0},{"id":9995403860,"gmtCreate":1661489512352,"gmtModify":1676536529710,"author":{"id":"4122632689447802","authorId":"4122632689447802","name":"ABplus","avatar":"https://community-static.tradeup.com/news/36e8f410f508cbaf7b19413f9aeb9a3f","crmLevel":2,"crmLevelSwitch":0,"followedFlag":false,"idStr":"4122632689447802","authorIdStr":"4122632689447802"},"themes":[],"htmlText":"Now what Nvidia?","listText":"Now what Nvidia?","text":"Now what Nvidia?","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":0,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/9995403860","repostId":"9995105277","repostType":1,"repost":{"id":9995105277,"gmtCreate":1661421927413,"gmtModify":1676536515618,"author":{"id":"3527667626267411","authorId":"3527667626267411","name":"Value_investing","avatar":"https://community-static.tradeup.com/news/89ffffc59ff9ac9cb9cb74f596418d44","crmLevel":0,"crmLevelSwitch":0,"followedFlag":false,"idStr":"3527667626267411","authorIdStr":"3527667626267411"},"themes":[],"title":"Earnings Analysis| Nvidia 3 Quarters' Exile","htmlText":"<a target=\"_blank\" href=\"https://laohu8.com/S/NVDA\">$NVIDIA Corp(NVDA)$</a> released its official fiscal year 2023 second-quarter report, corresponding to the natural day for the quarter ended July 31 results.On August 8, Nvidia had issued a second quarterly report warning. Therefore, the market knows the core financial data, investors focus on the three quarterly guidance and results will be.Worse Than Expected EarningsBloomberg analysts' forecast for third-quarter revenue was $6.4 billion, down 9%&nbsp;yoy. NVIDIA's results were worse than the market forecast.As a result, Nvidia&nbsp;plunged to $164 after the&nbsp;bell following the earnings announcement.As noted in previous analysis, Nvidia's third-quarter guidance&nbsp;is worse than the second quarter, with expected revenue size of $5.","listText":"<a target=\"_blank\" href=\"https://laohu8.com/S/NVDA\">$NVIDIA Corp(NVDA)$</a> released its official fiscal year 2023 second-quarter report, corresponding to the natural day for the quarter ended July 31 results.On August 8, Nvidia had issued a second quarterly report warning. Therefore, the market knows the core financial data, investors focus on the three quarterly guidance and results will be.Worse Than Expected EarningsBloomberg analysts' forecast for third-quarter revenue was $6.4 billion, down 9%&nbsp;yoy. NVIDIA's results were worse than the market forecast.As a result, Nvidia&nbsp;plunged to $164 after the&nbsp;bell following the earnings announcement.As noted in previous analysis, Nvidia's third-quarter guidance&nbsp;is worse than the second quarter, with expected revenue size of $5.","text":"$NVIDIA Corp(NVDA)$ released its official fiscal year 2023 second-quarter report, corresponding to the natural day for the quarter ended July 31 results.On August 8, Nvidia had issued a second quarterly report warning. Therefore, the market knows the core financial data, investors focus on the three quarterly guidance and results will be.Worse Than Expected EarningsBloomberg analysts' forecast for third-quarter revenue was $6.4 billion, down 9% yoy. NVIDIA's results were worse than the market forecast.As a result, Nvidia plunged to $164 after the bell following the earnings announcement.As noted in previous analysis, Nvidia's third-quarter guidance is worse than the second quarter, with expected revenue size of $5.","images":[{"img":"https://community-static.tradeup.com/news/9275049e3f9e9c99200727ac01324640","width":"905","height":"454"},{"img":"https://community-static.tradeup.com/news/7ad64c3a1ac0c79e3be1375df8b44a1f","width":"831","height":"158"},{"img":"https://community-static.tradeup.com/news/55cad102fdf45b566bb7ac120dc7cf5f","width":"847","height":"401"}],"top":1,"highlighted":2,"essential":2,"paper":2,"likeSize":0,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/9995105277","isVote":1,"tweetType":1,"viewCount":0,"authorTweetTopStatus":1,"verified":2,"comments":[],"imageCount":4,"langContent":"EN","totalScore":0},"isVote":1,"tweetType":1,"viewCount":261,"authorTweetTopStatus":1,"verified":2,"comments":[],"imageCount":0,"langContent":"EN","totalScore":0},{"id":9995400267,"gmtCreate":1661489221662,"gmtModify":1676536529660,"author":{"id":"4122632689447802","authorId":"4122632689447802","name":"ABplus","avatar":"https://community-static.tradeup.com/news/36e8f410f508cbaf7b19413f9aeb9a3f","crmLevel":2,"crmLevelSwitch":0,"followedFlag":false,"idStr":"4122632689447802","authorIdStr":"4122632689447802"},"themes":[],"htmlText":"But Nvidia Graphic cards are still expensive 😃","listText":"But Nvidia Graphic cards are still expensive 😃","text":"But Nvidia Graphic cards are still expensive 😃","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":1,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/9995400267","repostId":"1130817581","repostType":2,"repost":{"id":"1130817581","kind":"news","pubTimestamp":1661486292,"share":"https://ttm.financial/m/news/1130817581?lang=&edition=fundamental","pubTime":"2022-08-26 11:58","market":"us","language":"en","title":"Nvidia Stock: Get Out Now","url":"https://stock-news.laohu8.com/highlight/detail?id=1130817581","media":"Seeking Alpha","summary":"SummaryNvidia reported horrible Q2 numbers and provided disappointing guidance for the next quarter.","content":"<html><head></head><body><p><b>Summary</b></p><ul><li>Nvidia reported horrible Q2 numbers and provided disappointing guidance for the next quarter.</li><li>However, with cryptocurrency mining GPU demand in deep decline, Nvidia&#39;s problems could last longer than a few quarters.</li><li>Nvidia&#39;s valuation is still high, and earnings estimates should see more downward revisions.</li><li>I&#39;m comfortable about revisiting this stock in the $100-120 range, but for now, Nvidia is a sell.</li></ul><p>NVIDIA Corporation&#39;s (NASDAQ:NVDA) market cap reached an absurd high of more than $800 billion during the tech-top in November 2021. During this bubble phase, Nvidia&#39;s stock hit an all-time high of around $350, trading at more than 100 times TTM non-GAAP EPS (approximately 40 times TTM sales). Then, the Fed pricked the ultra-high multiple bubble, and many stocks, including Nvidia, crashed.</p><p>I warned about the &#34;Epic Drop&#34; in my late-November article, and one of my prime examples of the coming crash was Nvidia. However, despite being one of the most shockingly overvalued stocks of its time, Nvidia&#39;s problems run much deeper than the typical temporary overvalued company.</p><p>Nvidia reported earnings in line with its preannounced figures but well below prior guidance and analysts&#39; estimates. Moreover, the company&#39;s guidance was disappointing. Nvidia is not only suffering from overvaluation problems and a challenging macroeconomic backdrop. The company has entered a severe decline phase, and the market is probably underestimating how serious the situation is for Nvidia.</p><p>The company faces several challenging headwinds to its top line, and its bottom line may continue deteriorating in the coming quarters. Therefore, we will probably see earnings estimates and EPS decrease more than anticipated. Meanwhile, the stock should attempt to find a base, but a reasonable entry price may be around $100-120.</p><p><b>The Bubble Days Are Over - More Downside Ahead</b><img src=\"https://static.tigerbbs.com/3f1f84840d4c1f577471f0d35df1f240\" tg-width=\"640\" tg-height=\"676\" referrerpolicy=\"no-referrer\"/></p><p>NVDA(StockCharts.com)</p><p>This is only a three-year chart of Nvidia. So, we see that before the recent decline phase Nvidia skyrocketed by nearly 10X in just around two years. So, what occurred in this time frame? Why did we see such remarkable demand for Nvidia stock?</p><p>We can point to several elements. Nvidia weathered the coronavirus slow down better than many other companies as much of its gaming business is related to gaming. Then, Nvidia received a post-coronavirus recovery boost as well. The company&#39;s revenues surged by 40-60% or more in many quarters in 2020/2021, and investors loved its performance and stock.</p><p>The insatiable demand pushed the stock to grossly overbought and ludicrously overvalued levels (roughly 40 times trailing sales). However, what was the true catalyst behind this move? The company claimed that it benefited from surging gaming-related revenues. However, earlier this year, Nvidia settled with the SECfor failing to disclose its cryptocurrency-related sales.</p><p>A significant portion of Nvidia&#39;s GPU sales went towards cryptocurrency mining. Unfortunately, we cannot know precisely how much of the GPU sales were cryptocurrency related as the company did not disclose the numbers. However, we know that Nvidia&#39;s GPUs were widely used in Ethereum and other cryptocurrency mining, but sadly for the company, these sales are ending.</p><p><b>The End Of An Era</b></p><p>Nvidia&#39;s revenues benefited greatly from surging Ethereum and other cryptocurrency-related sales. When we look at Nvidia&#39;s surging sales in 2020/2021, this time frame coincides with the significant bull market in Ethereum and other digital assets. However, now the company is reporting sharp drops in sales. Nvidia&#39;s cryptocurrency mining processor (&#34;CMP&#34;) sales were down by66% YoY to just $140 million last quarter. While the company has a CMP GPU line dedicated to cryptocurrency mining, some of its gaming GPUs also went to cryptocurrency miners.</p><p>The massive problem Nvidia faces now is Ethereum&#39;s pivot away from GPU mining. Ethereum has been the driver of cryptocurrency-related mining GPU sales in recent years. However, Ethereum is moving away from intensive GPU mining, and the switch from proof-of-work to the proof-of-stake protocol should be complete soon.</p><p>Proof-of-stake is far less intensive and requires nothing near the computing power of proof-of-work. Therefore, the Ethereum network will not need a growing number of GPUs. On the contrary, as we advance, there will probably be a remarkably high number of unneeded GPUs.</p><p>Another reason why Nvidia&#39;s revenues spiked so rapidly was the GPU shortage. You&#39;d be lucky to get a quality GPU at MSRPin 2020/2021. Due to the GPU shortage, Nvidia&#39;s graphic cards could sell for two times MSRP or higher in many cases throughout this time frame. Naturally, this phenomenon significantly contributed to the company&#39;s skyrocketing revenues. We can presume that this dynamic occurred partially due to the substantial demand from the cryptocurrency segment.</p><p><b>What We Are Left With Now</b></p><p>Ethereum is moving away from GPU mining. Bitcoin and other digital assets rely more on ASIC miners over GPUs. We see Nvidia&#39;s CMP GPU sales are crashing, and general &#34;gaming&#34; revenues have declined by 33%YoY. Therefore, Nvidia faces a severe problem. A substantial portion of the company&#39;s gains may be gone permanently.</p><p>Additionally, Nvidia will no longer benefit from the cryptocurrency segment&#39;s growth. Moreover, the company will no longer benefit from the surging GPU prices it saw in 2020/2021. Instead, Nvidia faces the problem of cheaper GPUs, lower margins, and worsening profitability as the company moves forward.</p><p><b>Nvidia RTX 3080 Price Decline</b></p><p><img src=\"https://static.tigerbbs.com/25c65b3c0628b532f5748f8d4c917726\" tg-width=\"640\" tg-height=\"291\" referrerpolicy=\"no-referrer\"/></p><p>Nvidia RTX 3080(the verge.com )</p><p>We&#39;ve seen a price drop of about 65% for Nvidia&#39;s RTX 3080 GPU since the price peaked last year. This image captures Nvidia&#39;s GPU market and the company&#39;s problem. We will probably see prices stabilize and possibly move up marginally. However, we will not likely see significant price rises any time soon. After years of shortages, the market is oversaturated with Nvidia&#39;s GPUs. We are now seeing the opposite effect and probably have not yet seen the full impact of the oversupply. We must consider that unwanted mining GPUs could further flood the market, exacerbating the supply/demand issue.</p><p><b>We See It In The Results</b><img src=\"https://static.tigerbbs.com/1d7cfe94a82a2e7b2f943115d8e70bcc\" tg-width=\"640\" tg-height=\"166\" referrerpolicy=\"no-referrer\"/></p><p>Nvidia 8-K(investor.nvidia.com)</p><p>Nvidia&#39;s Q2 results were shockingly poor, and &#34;challenging macroeconomic conditions&#34; do not justify a 19% QoQ revenue drop. Less than one year ago, Nvidia was valued at more than 100 times trailing earnings and now sees YoY growth of just 3% YoY. Moreover, despite only a 3% revenue gain, the company&#39;s operating expenses surged by 36% YoY. Therefore, we see gross margins down substantially, operating income down by 80%, and net income down by 72%.</p><p><b>Now, Let&#39;s Check the Guidance</b><img src=\"https://static.tigerbbs.com/886574b4a6331498106528a2834f5675\" tg-width=\"640\" tg-height=\"196\" referrerpolicy=\"no-referrer\"/></p><p>Nvidia Q3 guidance(investor.nvidia.com)</p><p>The company guided to just $5.9 billion in revenues for Q3, 15% below the consensus forecast of$6.95 billion. $5.9 billion will be the company&#39;s second consecutive QoQ decline, equating to a YoY drop of 17%. Additionally, the company guided GAAP and non-GAAP gross margins of 62.4% and 65%. However, such a substantial rebound in gross margin will be challenging to achieve, and the company may report gross margins closer to 45-50%, substantially worse than its forecasts. Nvidia&#39;s GPU segment may continue struggling, leading to lower profitability and a worsening long-term image for the company.</p><p><b>Valuation - Still Too High</b></p><p>Nvidia has gone through a severe repricing phase. While the stock is not trading near 100 times TTM earnings, it&#39;s still expensive. Also, we must consider that the market began revising Nvidia&#39;s earnings lower and may not be done.</p><p><b>EPS Revisions</b></p><p><img src=\"https://static.tigerbbs.com/a56bd255c30f267c1fc7d8825b330556\" tg-width=\"640\" tg-height=\"332\" referrerpolicy=\"no-referrer\"/></p><p>EPS revisions(SeekingAlpha.com )</p><p>We see that the EPS forecast trend is lower here. However, considering that Nvidia recently came out with a horrible preannouncement and even more recently provided disappointing guidance, estimates should still go lower. Furthermore, EPS estimates may be too optimistic, as it is unclear whether Nvidia will have such impressive EPS growth in future years.</p><p><b>EPS Estimates</b></p><p><img src=\"https://static.tigerbbs.com/699c23f05dea3cbeb873da0db62a239d\" tg-width=\"640\" tg-height=\"268\" referrerpolicy=\"no-referrer\"/></p><p>EPS estimates(SeekingAlpha.com)</p><p>One factor seems clear. The stock is still too expensive here. With an expected EPS of $3.75 this year, Nvidia&#39;s P/E ratio is 45, still very high. EPS projections are for $5.46 next year. However, this figure seems too high, cannot be trusted, and will likely get revised lower. Nevertheless, even if we apply the $5.46 EPS estimates, we still arrive at a P/E of more than 30 for Nvidia. Over thirty times questionable projected earnings is a high price for a company facing significant top and bottom line pressures and will probably see more earnings estimate declines.</p><p>I anticipate that Nvidia could earn towards the lower end of current estimates, roughly $4 in EPS in fiscal 2024. Also, Nvidia deserves a lower P/E multiple due to poor performance and uncertainty. I&#39;m comfortable with a forward P/E of 25-30 on a projected EPS of $4 for next year. This dynamic brings us to a buy-in price target of $100-120. In this range, Nvidia becomes a buy, but now at $170, the stock is a sell in my view. I will revisit this stock in the $100-120 range. Until then, there are better stocks to buy.</p></body></html>","collect":0,"html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Nvidia Stock: Get Out Now</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nNvidia Stock: Get Out Now\n</h2>\n\n<h4 class=\"meta\">\n\n\n2022-08-26 11:58 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://seekingalpha.com/article/4537078-nvidia-get-out-now?source=content_type%3Areact%7Cfirst_level_url%3Ahome%7Csection%3Aportfolio%7Csection_asset%3Aheadlines%7Cline%3A5><strong>Seeking Alpha</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>SummaryNvidia reported horrible Q2 numbers and provided disappointing guidance for the next quarter.However, with cryptocurrency mining GPU demand in deep decline, Nvidia's problems could last longer ...</p>\n\n<a href=\"https://seekingalpha.com/article/4537078-nvidia-get-out-now?source=content_type%3Areact%7Cfirst_level_url%3Ahome%7Csection%3Aportfolio%7Csection_asset%3Aheadlines%7Cline%3A5\">Web Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"","relate_stocks":{"NVDA":"英伟达"},"source_url":"https://seekingalpha.com/article/4537078-nvidia-get-out-now?source=content_type%3Areact%7Cfirst_level_url%3Ahome%7Csection%3Aportfolio%7Csection_asset%3Aheadlines%7Cline%3A5","is_english":true,"share_image_url":"https://static.laohu8.com/e9f99090a1c2ed51c021029395664489","article_id":"1130817581","content_text":"SummaryNvidia reported horrible Q2 numbers and provided disappointing guidance for the next quarter.However, with cryptocurrency mining GPU demand in deep decline, Nvidia's problems could last longer than a few quarters.Nvidia's valuation is still high, and earnings estimates should see more downward revisions.I'm comfortable about revisiting this stock in the $100-120 range, but for now, Nvidia is a sell.NVIDIA Corporation's (NASDAQ:NVDA) market cap reached an absurd high of more than $800 billion during the tech-top in November 2021. During this bubble phase, Nvidia's stock hit an all-time high of around $350, trading at more than 100 times TTM non-GAAP EPS (approximately 40 times TTM sales). Then, the Fed pricked the ultra-high multiple bubble, and many stocks, including Nvidia, crashed.I warned about the \"Epic Drop\" in my late-November article, and one of my prime examples of the coming crash was Nvidia. However, despite being one of the most shockingly overvalued stocks of its time, Nvidia's problems run much deeper than the typical temporary overvalued company.Nvidia reported earnings in line with its preannounced figures but well below prior guidance and analysts' estimates. Moreover, the company's guidance was disappointing. Nvidia is not only suffering from overvaluation problems and a challenging macroeconomic backdrop. The company has entered a severe decline phase, and the market is probably underestimating how serious the situation is for Nvidia.The company faces several challenging headwinds to its top line, and its bottom line may continue deteriorating in the coming quarters. Therefore, we will probably see earnings estimates and EPS decrease more than anticipated. Meanwhile, the stock should attempt to find a base, but a reasonable entry price may be around $100-120.The Bubble Days Are Over - More Downside AheadNVDA(StockCharts.com)This is only a three-year chart of Nvidia. So, we see that before the recent decline phase Nvidia skyrocketed by nearly 10X in just around two years. So, what occurred in this time frame? Why did we see such remarkable demand for Nvidia stock?We can point to several elements. Nvidia weathered the coronavirus slow down better than many other companies as much of its gaming business is related to gaming. Then, Nvidia received a post-coronavirus recovery boost as well. The company's revenues surged by 40-60% or more in many quarters in 2020/2021, and investors loved its performance and stock.The insatiable demand pushed the stock to grossly overbought and ludicrously overvalued levels (roughly 40 times trailing sales). However, what was the true catalyst behind this move? The company claimed that it benefited from surging gaming-related revenues. However, earlier this year, Nvidia settled with the SECfor failing to disclose its cryptocurrency-related sales.A significant portion of Nvidia's GPU sales went towards cryptocurrency mining. Unfortunately, we cannot know precisely how much of the GPU sales were cryptocurrency related as the company did not disclose the numbers. However, we know that Nvidia's GPUs were widely used in Ethereum and other cryptocurrency mining, but sadly for the company, these sales are ending.The End Of An EraNvidia's revenues benefited greatly from surging Ethereum and other cryptocurrency-related sales. When we look at Nvidia's surging sales in 2020/2021, this time frame coincides with the significant bull market in Ethereum and other digital assets. However, now the company is reporting sharp drops in sales. Nvidia's cryptocurrency mining processor (\"CMP\") sales were down by66% YoY to just $140 million last quarter. While the company has a CMP GPU line dedicated to cryptocurrency mining, some of its gaming GPUs also went to cryptocurrency miners.The massive problem Nvidia faces now is Ethereum's pivot away from GPU mining. Ethereum has been the driver of cryptocurrency-related mining GPU sales in recent years. However, Ethereum is moving away from intensive GPU mining, and the switch from proof-of-work to the proof-of-stake protocol should be complete soon.Proof-of-stake is far less intensive and requires nothing near the computing power of proof-of-work. Therefore, the Ethereum network will not need a growing number of GPUs. On the contrary, as we advance, there will probably be a remarkably high number of unneeded GPUs.Another reason why Nvidia's revenues spiked so rapidly was the GPU shortage. You'd be lucky to get a quality GPU at MSRPin 2020/2021. Due to the GPU shortage, Nvidia's graphic cards could sell for two times MSRP or higher in many cases throughout this time frame. Naturally, this phenomenon significantly contributed to the company's skyrocketing revenues. We can presume that this dynamic occurred partially due to the substantial demand from the cryptocurrency segment.What We Are Left With NowEthereum is moving away from GPU mining. Bitcoin and other digital assets rely more on ASIC miners over GPUs. We see Nvidia's CMP GPU sales are crashing, and general \"gaming\" revenues have declined by 33%YoY. Therefore, Nvidia faces a severe problem. A substantial portion of the company's gains may be gone permanently.Additionally, Nvidia will no longer benefit from the cryptocurrency segment's growth. Moreover, the company will no longer benefit from the surging GPU prices it saw in 2020/2021. Instead, Nvidia faces the problem of cheaper GPUs, lower margins, and worsening profitability as the company moves forward.Nvidia RTX 3080 Price DeclineNvidia RTX 3080(the verge.com )We've seen a price drop of about 65% for Nvidia's RTX 3080 GPU since the price peaked last year. This image captures Nvidia's GPU market and the company's problem. We will probably see prices stabilize and possibly move up marginally. However, we will not likely see significant price rises any time soon. After years of shortages, the market is oversaturated with Nvidia's GPUs. We are now seeing the opposite effect and probably have not yet seen the full impact of the oversupply. We must consider that unwanted mining GPUs could further flood the market, exacerbating the supply/demand issue.We See It In The ResultsNvidia 8-K(investor.nvidia.com)Nvidia's Q2 results were shockingly poor, and \"challenging macroeconomic conditions\" do not justify a 19% QoQ revenue drop. Less than one year ago, Nvidia was valued at more than 100 times trailing earnings and now sees YoY growth of just 3% YoY. Moreover, despite only a 3% revenue gain, the company's operating expenses surged by 36% YoY. Therefore, we see gross margins down substantially, operating income down by 80%, and net income down by 72%.Now, Let's Check the GuidanceNvidia Q3 guidance(investor.nvidia.com)The company guided to just $5.9 billion in revenues for Q3, 15% below the consensus forecast of$6.95 billion. $5.9 billion will be the company's second consecutive QoQ decline, equating to a YoY drop of 17%. Additionally, the company guided GAAP and non-GAAP gross margins of 62.4% and 65%. However, such a substantial rebound in gross margin will be challenging to achieve, and the company may report gross margins closer to 45-50%, substantially worse than its forecasts. Nvidia's GPU segment may continue struggling, leading to lower profitability and a worsening long-term image for the company.Valuation - Still Too HighNvidia has gone through a severe repricing phase. While the stock is not trading near 100 times TTM earnings, it's still expensive. Also, we must consider that the market began revising Nvidia's earnings lower and may not be done.EPS RevisionsEPS revisions(SeekingAlpha.com )We see that the EPS forecast trend is lower here. However, considering that Nvidia recently came out with a horrible preannouncement and even more recently provided disappointing guidance, estimates should still go lower. Furthermore, EPS estimates may be too optimistic, as it is unclear whether Nvidia will have such impressive EPS growth in future years.EPS EstimatesEPS estimates(SeekingAlpha.com)One factor seems clear. The stock is still too expensive here. With an expected EPS of $3.75 this year, Nvidia's P/E ratio is 45, still very high. EPS projections are for $5.46 next year. However, this figure seems too high, cannot be trusted, and will likely get revised lower. Nevertheless, even if we apply the $5.46 EPS estimates, we still arrive at a P/E of more than 30 for Nvidia. Over thirty times questionable projected earnings is a high price for a company facing significant top and bottom line pressures and will probably see more earnings estimate declines.I anticipate that Nvidia could earn towards the lower end of current estimates, roughly $4 in EPS in fiscal 2024. Also, Nvidia deserves a lower P/E multiple due to poor performance and uncertainty. I'm comfortable with a forward P/E of 25-30 on a projected EPS of $4 for next year. This dynamic brings us to a buy-in price target of $100-120. In this range, Nvidia becomes a buy, but now at $170, the stock is a sell in my view. I will revisit this stock in the $100-120 range. Until then, there are better stocks to buy.","news_type":1},"isVote":1,"tweetType":1,"viewCount":184,"authorTweetTopStatus":1,"verified":2,"comments":[],"imageCount":0,"langContent":"EN","totalScore":0}],"defaultTab":"posts","isTTM":true}