NVIDIA CORP (NASDAQ:NVDA) Presents a High-Growth Breakout Opportunity

A systematic method for finding good investment chances joins basic growth speed with technical breakout shapes. This process filters for stocks showing good quarterly earnings and revenue gains, increasing profit margins, and good analyst changes, key parts of the ChartMill High Growth Momentum Rating. At the same time, these stocks must show good technical condition and a helpful price consolidation shape, as judged by the ChartMill Technical Rating and Setup Quality Score. This two-part study tries to find companies that are not only increasing quickly but are also set for possible short-term price gains.

High Growth Momentum Fundamentals

NVIDIA CORP (NASDAQ:NVDA) shows a strong profile for growth investors, receiving a High Growth Momentum Rating of 7. This number shows notable strength in several basic growth areas important for momentum plans, which focus on speeding up business results.

• Notable Earnings and Sales Growth: The company has shown strong year-over-year growth in its newest quarters, with EPS growth numbers of 101%, 72%, 57%, and 54% over the past four quarters. Sales growth has been just as notable, coming in at 94%, 78%, 69%, and 56% over the same time.
• Increasing Profitability: A main sign of how well operations are run, NVIDIA's profit margin has shown clear widening. The quarterly profit margin got better from 42.6% to 56.5% in the last two reported quarters, and the full-year margin increased from 16.2% to 55.8% over the past two fiscal years.
• Steady Earnings Surprises and Good Revisions: The company has exceeded EPS guesses in every one of the last four quarters, with an average surprise of 3.2%. Also, analysts have changed their earnings guesses for the next year higher by more than 4% in the last three months, showing increasing belief in its future.

This mix of high growth numbers, margin widening, and good estimate changes forms the center of a good momentum investment case, indicating the company's growth path is still strong.

Technical Strength and Market Position

From a technical view, NVIDIA shows a good base with a Technical Rating of 7. This number means the stock is in a clear uptrend and doing better than a large part of the market. The study, explained in the full technical report, points out several helpful points.

• The long-term trend is confirmed as good, giving a positive setting for investment.
• The stock is now trading close to its 52-week high, showing strong investor interest.
• It shows better relative strength, having done better than 80% of all stocks over the past year.
• Important moving averages (20-day, 50-day, 100-day, and 200-day) are all going up and are placed below the present price, making a structure of moving support.

This technical condition is important for momentum investors, as it indicates the stock is being bought and its upward trend has a high chance of continuing.

High-Quality Breakout Setup

Maybe the most current part for traders is NVIDIA's Setup Quality Rating of 8. This high number shows the stock is making a clear consolidation shape, possibly preparing for its next important price change. The setup study finds a defined trading range that has formed over the past month.

• Prices have been moving in a range between about $176 and $195, with lower movement showing a balance between buyers and sellers.
• A defined support area is found between $179 and $184, giving a sensible place for a stop-loss order to handle risk.
• Close resistance is seen around $192.58. A clear move above this point could signal the restart of the main uptrend.

For investors using a breakout plan, this shape gives a clear entry point above resistance and a defined risk point below support, matching the timing of an investment with a possible new upward move in the stock's price.

Finding Similar Opportunities

The filtering method that found NVIDIA can be a good tool for discovering other high-growth companies in positive technical positions. For investors looking to copy this process, a prepared screen is available.

You can find more possible high-growth momentum breakout choices by looking at this pre-set stock screen.

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Disclaimer: This article is for informational purposes only and does not constitute investment advice of any kind. The author has no position in any stock mentioned. All data and analysis are based on publicly available information and should be independently verified before making any investment decisions. Investing in stocks involves risk, including the potential loss of principal.