Analysis of the Medium to Long Term Investment Value of Nvidia (NVDA)
1、 Analysis of Core Financial Indicators
Valuation level
The current stock price is $138.85, with a dynamic P/E ratio of 54.83 times, a P/S ratio of 30.02 times, and a P/B ratio of 51.60 times, significantly higher than the semiconductor industry average, reflecting the high premium of the market for its AI leadership position.
Overvaluation needs to match high growth: If the revenue growth rate in the next two years is lower than expected, there may be a risk of valuation correction.
Profitability
ROE 127.21% ROA 59.13%， The management's capital allocation efficiency is extremely strong, and the ability to convert technological barriers into excess profits is outstanding.
The earnings per share (EPS TTM) is $2.53, and attention should be paid to the further profitability boost of next-generation GPU products such as B100.
Liquidity and institutional holdings
The top five institutions account for over * * 24% of their holdings (Vanguard, BlackRock, etc.), and their recent increase in holdings has been significant (such as Vanguard increasing its holdings by 35.62 million shares), indicating professional investors' recognition of long-term logic.
Today's trading volume was 195 million shares, with a turnover rate of * * 0.80% * *, and sufficient liquidity, suitable for large funds to layout in the medium and long term.
2、 Industry catalysts and risk points
The demand for AI computing power has exploded
News shows that data center financing will reach a new high in 2025, with clear growth in supporting links such as HBM storage and optical modules. NVDA, as a GPU core supplier, will directly benefit.
Barclays predicts that NVDA GPU sales may reach $160 billion by 2025 (approximately $100 billion by 2024), with an annualized growth rate of * * 60% * *, and a CAGR of * * 55% * * for the custom chip market.
Changes in the competitive landscape
Short term moat stability: CUDA ecological barriers are difficult to break through, but we need to be wary of the substitution risks of startups such as AMD MI300 series and Groq.
Supply chain dependence: The expansion of production capacity by key suppliers such as Ibiden may affect delivery capabilities.
Technical iteration risk
The next generation of HBM4 storage, 3nm process and other technological innovations need to be continuously tracked, and the intergenerational advantage of technology is the key to maintaining the gross profit margin (currently about 70%).
3、 Operational suggestions
Entry strategy
The short-term support level is $120.81 (2025-02-14), and if it falls below $130, positions can be opened in batches.
After breaking through the resistance level of $141.31, it is expected to challenge the previous high of $153.13, with a mid-term target price of $160-180 (based on 2025 EPS of $3.5, PEG ≈ 1.5).
risk management
The suggested stop loss point is set at $120 (-13.6% above current price), corresponding to the platform level before the Q3 2024 financial report.
The proportion of positions should not exceed 15% of the investment portfolio to avoid excessive exposure to a single industry.
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