NVIDIA is ARMless - To Buy or Not to Buy, that is the Question
Companies / AI Apr 03, 2022 - 06:50 PM GMTBy: Nadeem_Walayat
As suspected failure for the ARM deal to go through is about to become manifest and was expected to trigger a sell off buying opportunity, Though Nvidia IS firing on all cylinders, it's just that as has been the case for the whole of 2021, NVIDIA IS OVER VALUED! My exposure stands at 9.6% of target (0.5% of portfolio) which is actually down on last week as I took profits given that I do expect Nvidia to be one of the stocks to take a tumble to fresh lows. It is hard to believe that the stock can trade below it's recent low of $209, after all that WAS my target draw down for the stock! So it may yet turn out to be THE LOW, after all the bounce back from $209 was quite powerful, i.e. lots of buy the dippers stepping in. Nvidia is a tough stock to buy, because it is a FANTASTIC CORPORATION that trades at a too high a valuation. Which means no matter what price I pay for Nvidia in hindsight it will probably prove to VERY HIGH! It's one of those things where you know how good a corporation is and one is desperate to expand ones exposure to but you also know its DAMN expensive, especially when we look at where Facebook is trading right now i.e. on a valuations that's less than 1/4 that of Nvidia! Is Nvidia worth 4 TIMES as much as Facebook? Seriously? And this is why despite Nvidia's price plunge to date I see a lot more potential downside for this stock. Maybe I should just do the same as for Apple? I.e. buy to just 1% of portfolio and then hold fire for much, much lower prices IF they materialise great, if not then at some point I would have to bite the bullet and buy Nvidia for something like $265 a share!
I need to get a move on with developing my AI's to the point that they take such decisions out of my hands!
Putting the buying levels on the chart clearly shows that they are far too closely clustered, the range from $208 to $182 is just 13%, too tight! It's just that when I set the buying levels I was grateful for the $100 / 30% drop from $336 to below $236, what more could one ask for? $209, that's a whopping 40% off the high! 50% is at $173. How many could imagine Nvidia falling to 50% from it's high of barely 2 months ago! Whilst the price I have always had at the back of my mind is $140, but it seems so distant from $346, a 60% drop! A Cathy Wood stock type drop! Would even put Facebook's 45% drop to shame! The thing is a drop to $140 would still leave Nvidia trading at 40X earnings, compared to Facebook on just 17! So it is definitely possible.
My current exposure is just 10% of target (0.5%) after taking some profits at above $250, and I have limit orders to start accumulating at $209.5, $207, $202. $192, $190, and $182. Clearly they are too closely clustered so I am going to scrape $207 and $190, in favour of more distant limit orders at $178 and $172, and see what happens. With the risk of having to bite the bullet and some weeks down the road and pay north of $260 for a larger stake.
This article is an excerpt from my recent in-depth analysis that mapped out how low AI tech stocks could trade during the stock market panic of 2022.
Stock Market in the Eye of the Storm, Visualising AI Tech Stocks Buying Levels
Content:
m = f - Everything is Waving!
How to Invest in Stocks 20202 and Beyond
Stock Market Calm In the Eye of the Storm
Stock Market Forward Guidance
50% DRAWDOWNS ARE THE NORM!
Current State of Draw downs
Quantum AI Stocks Portfolio Current
AI Tech Stocks Buying Levels
Earnings Growth Factor
GOOGLE TO BE SLICIED INTO 20 PIECES!
FACBOOK MISSION ACCOMPLISHED Whilst CNBC Clowns Buy the TOP and SELL the BOTTOM!
MICROSOFT Short and Sharp
Still Waiting to Take a BITE out of APPLE
NVIDIA is ARMless - To Buy or Not to Buy, that is the question.
AMD - The Chip Master
TSMC - The World's Supreme Chip Fabricator
AMAZON the Dark Horse!
ARKK SARK SHORT FUND
That was first made available to patrons who support my work.So for immediate first access to ALL of my analysis and trend forecasts then do consider becoming a Patron by supporting my work for just $4 per month. https://www.patreon.com/Nadeem_Walayat.
Also access to my most recent analysis focused on continuing to capitalise on the downward spiral in stock price in response to first Inflation Panic and now added to by War Panic.
World War 3 Phase 1 - Putin WINS Ukraine War!
What Putin Plans for Ukraine
JRS.L Capitalising on Russia's War CRASHED Stocks
THE 2020's INFLATION MONSTER!
Stock Market Trend Forecast Current State
Stock Market FOMO Gives Way to FEAR of Buying the Dip
AI Stocks Portfolio Current State With Updated Buying Levels
FACEBOOK Stock 45% CRASH - Game Over for META?
FACEBOOK RINSE AND REPEAT
INVESTING LESSON - HAVE A PLAN AND THEN EXECUTE IT!
HIGH RISK STOCKS - INVEST AND FORGET
High Risk Stocks Portfolio Revised Buying Levels
GROWTH STOCKS TO CAPITALISE ON THE PANIC OF 2022
1. XXXX - RANK 1 - $121.8, PE 7.8, EGF 38%
2. XXXX - RANK 1 - $58.5, PE 9.9, EGF 30%
3. XXXX- RANK 2 - $16.7, PE 8.7, EGF 33%
4. XXXX - RANK 2 - $89.5, PE 17.2, EGF 23%
5. XXXX - RANK 2 - $49.7 - PE 196, EGF 188%
And gain access to my recent timely analysis lays out how to invest in during the panic of 2022, to be soon followed by scheduled analysis that continues my trend forecast into the end of 2022.
HOW TO SUCCESSFULLY INVEST IN STOCKS During 2022 and Beyond
CONTENTS:
1. UNDERSTAND WHAT INVESTING IS
2. INVEST IN GOOD COMPANIES
3. UNDERSTAND THAT WHICH ONE IS INVESTING IN
4. STOCK PRICES
5. EARNINGS CATCHUP TRADING RANGE TREND PATTERN
6. EMOTIONAL INVESTING
7. MONITORING AND LIMITING EXPOSURE IS MOST IMPORTANT
8. BUY AND SELL on the Basis of VALUATIONS
9. INVESTORS BIGGEST MISTAKE
10. BEST TIME TO BUY STOCKS
11. WORST TIME TO BUY STOCKS
12. BUY VOLATILITY
13. INVESTING TIME
14. FUND MANAGERS
15. OPTIONS
16 . INFLATION
17. INVEST AND FOREGET
AI Tech Stocks Draw down and End of Year 2022 Price Targets
CATHY WOOD ARK GARBAGE
So for immediate first access to ALL of my analysis and trend forecasts then do consider becoming a Patron by supporting my work for just $4 per month. https://www.patreon.com/Nadeem_Walayat.
My analysis schedule includes:
- UK House Prices Trend Analysis, including an update for the US and a quick look at Canada and China - 65% done
- Stock Market Trend Forecast into the End of 2022
- How to Get Rich! - 90% done - This is a good 6 month work in progress nearing completion.
- US Dollar and British Pound analysis
- Gold Price Trend Analysis - 10%
Again for immediate access to all my work do consider becoming a Patron by supporting my work for just $4 per month. https://www.patreon.com/Nadeem_Walayat.
And ensure you are subscribed to my ALWAYS FREE newsletter for my next in-depth analysis.
Your analyst capitalising on stock market panic selling
Nadeem Walayat
Copyright © 2005-2022 Marketoracle.co.uk (Market Oracle Ltd). All rights reserved.
Nadeem Walayat has over 35 years experience of trading derivatives, portfolio management and analysing the financial markets, including one of few who both anticipated and Beat the 1987 Crash. Nadeem's forward looking analysis focuses on UK inflation, economy, interest rates and housing market. He is the author of five ebook's in the The Inflation Mega-Trend and Stocks Stealth Bull Market series that can be downloaded for Free.
Nadeem is the Editor of The Market Oracle, a FREE Daily Financial Markets Analysis & Forecasting online publication that presents in-depth analysis from over 1000 experienced analysts on a range of views of the probable direction of the financial markets, thus enabling our readers to arrive at an informed opinion on future market direction. http://www.marketoracle.co.uk
Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any trading losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors before engaging in any trading activities.
Nadeem Walayat Archive |
© 2005-2022 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.
