NVDA - Embedded Expectations Analysis - 2018 09 13
NVIDIA Corporation (NVDA:USA) currently trades above recent averages relative toUAFRS-based (Uniform) Earnings, with a 29.1x Uniform P/E. At these levels, the market is pricing in bullish expectations for the firm, however management has concerns about demand and performance sustainability
Specifically, management may lack confidence in their ability to sustain elevated revenue, net income and EPS levels. Also, they may lack confidence in the sustainability of demand growth for data centers and in their ability to maintain growth across their platforms. Furthermore, they may be concerned about the complexity of inference and about their inventory levels. Finally, they appear to be exaggerating the performance of their Turing graphics processing unit
NVIDIA engages in graphics processing unit (GPU)-based visual computing and accelerated computing platforms. The company has two segments, GPU and Tegra Processor, which are based on a single underlying architecture. The company's GPU product brands are aimed at markets including GeForce for gamers; Quadro for designers; Tesla and DGX for artificial intelligence data scientists and big data researchers; and GRID for cloud-based visual computing users. The company's Tegra brand integrates an entire computer onto a single chip, and incorporates GPUs and multi-core CPUs to drive supercomputing for autonomous robots, drones, and cars, as well as for game consoles and mobile gaming and entertainment devices.
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