Why NVDA Dropped 7 Days in a Row: Earnings Outlook

setting revenue. The stock did close higher yesterday. It's snapped a 7-day losing streak, which by the way was its longest slump in more than 7 years. Let's bring bring in CJ Muse. He's the semi analyst at Canaccord Genuity. Has a buy rating on Nvidia. His price target is 350 bucks, which is a nice move from here. Stock's up more or less in line with the Nasdaq, kind of with the S&P for the year. I mean, that's fine, but here we are again, CJ, expecting I would assume what's going to be blowout numbers. I guess the question is, will the stock actually react in a positive fashion? >> Yeah, I mean, the truth is we've been expecting it all year and we've been dead wrong. Um I think the good news from investor positioning is that most hedge funds um are underweight or using Nvidia as a funding short. Uh and many of the long only investors uh are underweight. Um and so I I think we are going to get another, you know, monster beat. Uh I think Jensen's going to come out uh pretty vigorous in terms of their competitive positioning. And so I do think that does set up where the risk reward is higher. Um you know, on the other hand, there are ongoing concerns, whether it's circular financing, market share uh for inference, uh whether they can sustain their gross margins in a world where memory pricing is is ripping higher. Um so, you know, I'm not sure that they can solve all of those questions tonight, but they are going to do $16 to $17 next year, which means the stock is trading at 12 times. So, I think risk reward uh you want to be there tonight. Um but, you know, to be fair, you know, I sound like a broken record cuz I've been saying that all year. >> Yeah, well, you're not alone in that. Um you know, and 12 times does sound pretty compelling, trading at only 12 years' worth of next year's earnings. Uh even with the headwinds you describe. Anything unexpected perhaps coming our way from Nvidia or, you know, conversation and or articulation around certain themes perhaps on the conference call that might not be expected? >> Yeah, sure. So, you know, I think that if you go back in time at GTC they outlined revenues for data center second half 25 through 27. They could come out and actually give a number just for 27. And with the street at 523 million and some of the more most bullish people thinking 700 million or more or billion rather. Um that could really move the needle. So, that would be number one. Number two, you know, they are really helping Neo clouds and that is supporting the potential for a recurring revenue model. And so, I think that would be something to really listen to. And then I think the third point would be all of the efforts that they're making around open source models. And I think that if they can start to kind of change the storyline around recurring revenue, adding more value to their customers, not just from hardware but software, you know, I think that could really start to, you know, change the sentiment on the name. So, those would be three things to look out for. I'm not saying it's coming but, you know, there is a good