Exploring the Growth Potential of NVIDIA CORP (NASDAQ:NVDA) as It Nears a Breakout.

Groth investors are looking for stocks showing high revenue and EPS growth. We will have a look here to see if NVIDIA CORP (NASDAQ:NVDA) is suited for growth investing, while it is forming a base and may be ready to breakout. Investors should of course do their own research, but we spotted NVIDIA CORP showing up in our growth with base formation screen, so it may be worth spending some more time on it.

Unpacking NVDA's Growth Rating

ChartMill assigns a Growth Rating to each stock, ranging from 0 to 10. This rating is determined by analyzing different growth elements, including EPS and revenue growth, spanning both historical and future figures. In the case of NVDA, the assigned 8 reflects its growth potential:

• The Earnings Per Share has grown by an impressive 130.69% over the past year.
• Measured over the past years, NVDA shows a very strong growth in Earnings Per Share. The EPS has been growing by 83.26% on average per year.
• NVDA shows a strong growth in Revenue. In the last year, the Revenue has grown by 114.20%.
• The Revenue has been growing by 64.24% on average over the past years. This is a very strong growth!
• Based on estimates for the next years, NVDA will show a quite strong growth in Earnings Per Share. The EPS will grow by 19.05% on average per year.
• NVDA is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 19.11% yearly.

Unpacking NVDA's Health Rating

ChartMill assigns a proprietary Health Rating to each stock. The score is computed by evaluating various liquidity and solvency ratios and ranges from 0 to 10. NVDA was assigned a score of 9 for health:

• An Altman-Z score of 53.39 indicates that NVDA is not in any danger for bankruptcy at the moment.
• NVDA has a Altman-Z score of 53.39. This is amongst the best in the industry. NVDA outperforms 98.17% of its industry peers.
• The Debt to FCF ratio of NVDA is 0.14, which is an excellent value as it means it would take NVDA, only 0.14 years of fcf income to pay off all of its debts.
• The Debt to FCF ratio of NVDA (0.14) is better than 85.32% of its industry peers.
• A Debt/Equity ratio of 0.11 indicates that NVDA is not too dependend on debt financing.
• NVDA has a Current Ratio of 4.44. This indicates that NVDA is financially healthy and has no problem in meeting its short term obligations.
• Looking at the Current ratio, with a value of 4.44, NVDA is in the better half of the industry, outperforming 68.81% of the companies in the same industry.
• NVDA has a Quick Ratio of 3.88. This indicates that NVDA is financially healthy and has no problem in meeting its short term obligations.
• NVDA's Quick ratio of 3.88 is fine compared to the rest of the industry. NVDA outperforms 72.48% of its industry peers.

How do we evaluate the Profitability for NVDA?

ChartMill assigns a proprietary Profitability Rating to each stock. The score is computed by evaluating various profitability ratios and margins and ranges from 0 to 10. NVDA was assigned a score of 10 for profitability:

• The Return On Assets of NVDA (65.30%) is better than 99.08% of its industry peers.
• The Return On Equity of NVDA (91.87%) is better than 99.08% of its industry peers.
• The Return On Invested Capital of NVDA (76.63%) is better than 100.00% of its industry peers.
• The Average Return On Invested Capital over the past 3 years for NVDA is significantly above the industry average of 11.22%.
• The last Return On Invested Capital (76.63%) for NVDA is above the 3 year average (48.58%), which is a sign of increasing profitability.
• NVDA has a Profit Margin of 55.85%. This is amongst the best in the industry. NVDA outperforms 97.25% of its industry peers.
• NVDA's Profit Margin has improved in the last couple of years.
• With an excellent Operating Margin value of 62.88%, NVDA belongs to the best of the industry, outperforming 100.00% of the companies in the same industry.
• NVDA's Operating Margin has improved in the last couple of years.
• Looking at the Gross Margin, with a value of 75.45%, NVDA belongs to the top of the industry, outperforming 93.58% of the companies in the same industry.
• NVDA's Gross Margin has improved in the last couple of years.

Looking at the Setup

The Setup Rating of a stock determines to which extend the stock is consolidating. This score also ranges from 0 to 10 and is updated daily. The setup score evaluates various short term technical indicators. For NVDA this score is currently 8:

Although the technical rating is bad, NVDA does present a nice setup opportunity. We see reduced volatility while prices have been consolidating in the most recent period. There is a resistance zone just above the current price starting at 114.33. Right above this resistance zone may be a good entry point. There is a support zone below the current price at 96.91, a Stop Loss order could be placed below this zone. We notice that large players showed an interest for NVDA in the last couple of days, which is a good sign.

Our Strong Growth screener lists more Strong Growth stocks and is updated daily.

Check the latest full fundamental report of NVDA for a complete fundamental analysis.

Our latest full technical report of NVDA contains the most current technical analsysis.

Disclaimer

Important Note: The content of this article is not intended as trading advice. It is essential to perform your own analysis and exercise caution when making trading decisions. The article presents observations created by automated analysis but does not guarantee any trading or investment outcomes. Always trade responsibly and make independent judgments.