Poking Holes In The Nvidia Bear Case: Q4 Pre-Earnings Report

Summary:

  • Nvidia Corporation is considered overvalued by many investors after a prolific rally, but the firm has been beating expectations consistently.
  • The nature of the AI revolution is distinctly different from the Internet revolution and many investors appear to be using hindsight bias to analyze AI as a bubble.
  • Nvidia’s ability to deliver on promises and exceed expectations, coupled with an unprecedented competitive advantage, means this stock can likely continue rallying despite high valuation risk.
  • Given the rapidly rising use cases for AI and the competitive advantages of Nvidia’s product eco-system, high demand and partnerships can enable to firm to continue outperforming the Street’s expectations.

White cyborg robotic hand pointing his finger to human hand with stretched finger - ai artificial intelligence.

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Russ Hanneman(Investor): Why would you go after revenue?

Richard (Founder): Because… To make money.

Russ (Investor): No. If you show revenue, people will ask “How much?” And it will never be enough. The company that was the 100xer, the 1,000xer, becomes the 2x dog. But if you have no


Analyst’s Disclosure: I/we have a beneficial long position in the shares of NVDA either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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