Artificial intelligence chip king Nvidia rose above its 21-day average on April 25, topped its 50-day on May 1 and continued to climb. After getting hit earlier this year due to concerns about AI chip growth slowing amid rising competition, and possible tariff repercussions, Nvidia has risen since late April.
That begs the question: Is the worst over for the AI chip giant or is this a temporary reprieve? On Thursday, the Relative Strength (RS) Rating for Nvidia stock climbed into a higher percentile, rising to 75 from 69 the day before. The jump puts Nvidia just below a key benchmark.
The 75 RS Rating shows that Nvidia stock tops 75% of all stocks for price performance over the past year. The market's biggest winners tend to have an 80 or higher RS Rating in the early stages of their moves. See if Nvidia can continue to show renewed price strength and clear that threshold.
Can You Really Time The Stock Market?
Nvidia stock dropped to 86.62 on April 7. It turned up then and closed at 117.37 Thursday, up fractionally for the day and achieving its fourth higher close in the last six trading sessions.
Among its other key ratings Nvidia has a best-possible 99 EPS Rating and a respectable 89 Composite Rating of 99. Additionally, its SMR Rating (sales + profit margins + return on equity) of A is also top-notch. One yellow flag is its D- Accumulation/Distribution Rating showing that big funds are currently selling more shares than buying.
Nvidia reported 71% earnings growth in the latest quarterly report to 89 cents per share. Sales climbed 78% year over year to $39.3 billion. Look for the next report on or around May 28. Analyst consensus is for milder yet still strong EPS growth of 45% on a 66% hike in sales to a record $43.1 billion.
The company earns the No. 2 rank among its peers in the Electronics-Semiconductor Fabless industry group. Rival AI-chip maker Broadcom is the No. 1-ranked stock in the group.
IBD's unique RS Rating tracks technical performance by using a 1 (worst) to 99 (best) score that indicates how a stock's price performance over the trailing 52 weeks matched up against all other stocks.
This article was created automatically with Stats Perform's Wordsmith software using data and article templates supplied by Investor's Business Daily. An IBD journalist may have edited the article.
Please follow James DeTar on Twitter @JimDeTar
RELATED:
Chip Stocks To Watch And Semiconductor Industry News
IBD Stock Rating Upgrades: Rising Relative Strength
Why Should You Use IBD's Relative Strength Rating?
How Relative Strength Line Can Help You Judge A Stock
Ready To Grow Your Investing Skills? Join An IBD Meetup Group!
