What's Going On With Nvidia Stock?

Nvidia Corporation NVDA shares are trading higher Friday as the stock recovers from a dip Thursday following June's inflation data release.

The Details:

Thursday's June inflation data came in cooler-than-expected, and the Consumer Price Index marked its lowest print since May 2020 with headline CPI inflation slowing from 3.3% in May 2024 to 3% in June 2024.

Anticipating rate cuts in the near-term, investors rotated out of mega cap tech stocks and into small cap names and debt-heavy sectors causing the Russel 3000 Index to gain more than 3% Thursday. Nvidia led the Nasdaq lower to close down 364 points Thursday, just one day after marking another record closing high on Wednesday. 

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According to SEC filings, Nvidia director Mark Stevens sold 785,000 shares valued at approximately $104 million on July 9 and July 10. Nvidia CEO Jensen Huang also sold 240,000 shares valued at approximately $31.86 million in addition to several other sales throughout the end of June and beginning of July. 

Benzinga's Mark Putrino has chosen Nvidia as the Stock of the Day and identified a "bearish engulfing pattern" on the chart which may signify a move lower is coming. However, Benchmark analyst Cody Acree maintained the stock with a Buy and raised the price target from $135 to $170 on Friday. 

According to data from Benzinga Pro, Nvidia shares are moving on below-average trading volume Friday and the stock remains above its 50-day moving average of $111.87. 

NVDA Stock Prediction 2024:

When buying a stock for a longer time horizon, it is important for investors to assess where they think the stock is headed in the future.

When mapping a stock's future trajectory, investors should consider factors including the future earnings expectations and expected performance against a benchmark.

Nvidia’s revenue has grown at an average rate of 78.19% annually over the past 5 years. While past performance is not a guarantee of future results, investors should also look at a stock's historical performance when compared to both a benchmark index and the company's peers. Shares of NVIDIA have seen an annualized return of 83.93%, outperforming the S&P500 index by 75.53%. This compares to 28.65% growth in the overall Information Technology sector. NVIDIA has a beta of 2.05.

NVDA Price Action: According to Benzinga Pro, Nvidia shares are up 3.15% at $131.42 at the time of publication Friday.

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