Watch Nvidia ($NVDA) tomorrow. 10:1 stock split…and a slew of upgrades and price target hikes. – May 22, 2024
Dan Fitzpatrick here at StockMarketMentor.com. Guess which stock I want to look at today? That would be correct, NVIDIA ( NASDAQ: NVDA ).
The company reported some pretty monstrous earnings. The thing that was really cool is I don’t understand why it didn’t get off to an earlier start here frankly. However, the company announced a 10:1 stock split that is going to happen in June.
That’s going to bring an entirely new class of traders into the stock. A lot of those with, let’s just say capitalization, aren’t really going to feel enthused about spending $1,000.00 on one share of something. But they would sure be enthused about spending $1,000.00 on 10 shares of something.
Just think the opposite of Berkshire Hathaway, I’d say NVIDIA ( NASDAQ: NVDA ) has had a lot better performance than Berkshire Hathaway has had, I think probably in the entire lifetime of Warren Buffett. The bottom line is, NVIDIA ( NASDAQ: NVDA ) has been a real monster and a 10:1 stock split is going to push this thing into the stratosphere. It can’t do it on stock split alone, it has to have earnings and revenue growth, which it does.
This is the way I’m looking at this, (and we’ve had this on the Active Trade List for a while) we’ve traded around it a bunch of times. We rode this thing up, sitting around here, farting around sideways for the last two, two and a half months or so, and now this is pushing through $1,000.00.
So let’s go take a little walk down memory lane and see what happened when the stock finally, now, was a longer base, but when it finally broke out above 500.00, let’s see what happened. This is why I’m doing this, because this is a, what are we going to do tomorrow? video here.
And so you see the stock bang, it makes a big move here, okay crap, I missed that, I’ll wait for the next pullback. I’ll bet it will pull back and get a chance to buy it here. Okay, well crap, it’s not doing that, maybe I’ll just buy it tomorrow. And then fine, maybe you buy it here, and it’s already up 10 percent from where you missed it.
The point is, a stock like this, when it gets going it just keeps going. I’m not saying that we’re going to get the same type of dynamic tomorrow, but I’m not saying that we’re not, either. In other words, earnings were great. They posted some really, really strong numbers all across the board.
This has been sitting around here, everybody’s been waiting for NVIDIA ( NASDAQ: NVDA ) for a long time. Will this just continue to run higher, and higher, and higher? My suspicion is, that it probably will. If you’re long and I am, we’re long from $150.00, and we felt like we were getting in late. Think about that for you folks who think you’re getting into Bitcoin late.
Anyway, the bottom line is, this stock cuts through $1,000.00. And my sense is, it’s going to keep going for a couple of reasons. First of all, a 10:1 stock split, great, I’m in, I’ve got to do that. My gosh, it’s just like back in the 90s, but also, analysts have been raising their price targets for a while.
The most aggressive one on the street was 1,200.00, I think. No, it was 1,100.00 or something. And I had said, way back in the day, that I thought this could go to 1,000.00. That seemed a little bit outlandish, it didn’t seem that way to me because it is just looking at the chart, it doesn’t have anything to do with predictions.
The point is, we’ve got all of these analysts now that have price targets of $1,000.00, 1,100.00, maybe 1,200.00. A lot of them are 900.00, 840.00, and stuff like that. So what do you think these guys are going to be doing now that NVIDIA ( NASDAQ: NVDA ) is up above $1,000.00? I’ll tell you what they’re going to be doing. They’re going to be raising their estimates.
And when they raise their price targets you are going to see the stock continue to run. Here, this is the page on Yahoo Finance right now. This will all change tomorrow, but the average price target was 1,050.00. The current price right here, that, obviously, changes tomorrow so we’re seeing all these strong buys.
Now how many do you think are going to come out and say, you know what, we’re bumping our price target from 1,000.00 up to 1,200.00, or 1,300.00, or something like that? And that’s going to bring in more buyers into this stock.
So here’s my suggestion, look at getting some of this tomorrow. To be candid with you, I wouldn’t even put in a stop, this could pull back. Don’t get the wrong idea, I’m not saying, to throw caution to the wind, we’re going to the moon. I’m just saying, I don’t even know where to tell you to put a stop when the stock can be so swingy, so volatile.
I’ll just say, the idea of getting involved here is over a multi-day period. So you take a small position here. And then if the stock continues to run, you gradually add to your position over the next week or two, not the next day or two. Because you’re likely to see, at some point, a little pullback that will give you a better opportunity to buy.
But the trick is, when does that pullback happen? Does the pullback come from here or does it come up here? We don’t know how far and for how long the stock is going to continue to run. I’m just saying, if you want to get in don’t wait for the perfect buying opportunity because you’re not going to get one of those, sorry.
You just take a little bit by little bit and gradually increase your position size. Add to profits, not to losses. Don’t average down, but as long as the stock is working in your favor, then feel free to go ahead and scale in a little bit more and a little bit more.
Don’t get too lathered up to where it’s everything NVIDIA ( NASDAQ: NVDA ). It’s just a trade, that’s all this is, it’s a trade, but it’s a pretty darn good trade. And my bet is, I’ll say it, $1,500.00 before the end of the year. Those who know me would say that I’m really wimping out because $1,500.00 by the end of the year is conservative. I think it’s probably going to be, I don’t know, before Halloween.
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