For investors looking to join strong earnings momentum with positive chart patterns, a multi-layered screening method can be very useful. By selecting for stocks with good technical condition, a clear formation for possible breakouts, and basic high-growth financials, traders try to find chances where good price movement is backed by speeding business results. This method fits with plans that focus on both the "when" and the "what" of investing, finding not only financially healthy companies but also good entry points.
NVIDIA CORP (NASDAQ:NVDA) appears as a leading choice from such a screen, showing the effective combination of technical and basic strength.
High Growth Momentum Financials
The heart of the high-growth momentum argument for NVIDIA depends on its outstanding and continued financial speed. The company's earnings and sales growth are not just high, they are showing notable steadiness and force, which is exactly what momentum investors look for.
- Strong Earnings Growth: The company's trailing twelve-month (TTM) EPS has increased more than 60% year-over-year. More notably, recent three-month results show continued high-double-digit growth:
- Most Recent Quarter (Q2Q): +60.5%
- Previous Quarter (Q-1): +54.4%
- Quarter Before That (Q-2): +56.9%
- Solid Sales Increase: Revenue growth tells a similar story of strong demand, with TTM sales up more than 65%. The sequential three-month sales growth numbers stay very strong, showing the growth is wide-reaching.
- Profit Margin Improvement: A main point of separation for good growth is improving profitability. NVIDIA's profit margin in its last reported full year was 55.85%, a clear rise from 48.85% the year before and 16.19% two years earlier. This pattern of margin improvement signals pricing ability and operational effectiveness together with top-line growth.
- Analyst Trust and Performance: The company has exceeded EPS guesses in each of the last four quarters, with an average beat of more than 2%. Also, analysts have changed their guesses for the next fiscal year higher by almost 4% over the last three months, showing increasing trust in the company's future outlook. This mix of beating guesses and getting higher changes is a sign of positive earnings momentum.
These numbers together add to NVIDIA's good High Growth Momentum Rating. For momentum investors, this steady speed, margin improvement, and positive guess changes are important, as they indicate the company's growth path is not a short event but a continued pattern likely to keep drawing investor attention.
Technical Condition and Formation Quality
While financials give the "why," technical study gives the "when." NVIDIA's chart shows a strong case for a stock that is both in a forceful trend and may be forming for its next move. According to the detailed technical report, the stock gets a high Technical Rating of 9 out of 10.
- Good Trend Agreement: Both the long-term and short-term trends are scored as positive. The stock is trading above its important moving averages (20, 50, 100, and 200-day SMAs), which are all in a rising arrangement. This shows continued buying pressure across many time frames.
- Market Outperformance: With a relative strength percentile ranking above 86%, NVIDIA has clearly done better than most of the market over the past year, a trait of real market leaders.
- Base Formation and Setup Chance: Maybe most important for entry timing, NVIDIA has a Setup Rating of 7. The study notes that "prices have been forming a base recently and the price movement has been less." After a big rise, the stock has been trading in a set range over the past month, letting it absorb gains and build a new level of support. The report finds a clear support area between about $183.68 and $186.24, made by a meeting of moving averages and trendlines. This base formation inside a firm upward trend, with set support levels, makes a possible setup for a new breakout.
A Combined Chance
NVIDIA shows a meeting of factors that high-growth momentum plans look for: outstanding basic momentum confirmed by speeding earnings and sales, joined with a technically healthy chart that shows leadership and a constructive halt in its trend. The high Growth Momentum Rating confirms the condition of the basic business engine, while the good Technical and Setup Ratings suggest the stock's price movement is in agreement and may be getting ready for its next step up. This agreement lowers the chance of buying into a "story" stock without market confirmation or following a technically weak stock with good financials.
Find Other Possible Setups
The screen that found NVIDIA is made to find other stocks showing this effective mix of high-growth financials and positive technical setups. For investors wanting to look at similar chances, you can see the current results of this plan via the High Growth Momentum Breakout Setups Screen.
Disclaimer: This article is for information and learning only. It does not form investment guidance, a suggestion, or an offer to buy or sell any security. The study is based on given data and should not be the only ground for any investment choice. Investing includes risk, including the possible loss of original money. Always do your own study and think about talking with a qualified financial advisor before making any investment choices.
