The Long Term Investor

NVDA is UP so far today and that is good news for my portfolio. BUT....it is a very mixed day for my little portfolio.....five stocks red and four green.

I have not looked at my account today so I have no idea if I am up or down. I really dont care at the moment.......I am too lazy to walk into the study and get my token to log in and check my account.

 

I have been seeing lately that when I GOOGLE something I am getting a little AI summary at the top of the search list that gives me the answer to whatever I was looking for.

Actually....I have been very surprised that the AI answers even on something like a complex medical question are very accurate.

AND....so far it has not harangued me to......."DIE HUMAN".

Google AI chatbot responds with a threatening message: "Human … Please die."

https://www.cbsnews.com/news/google-ai-chatbot-threatening-message-human-please-die/

 

Well thats big of them. A really SHOCKING prediction.....GASP....a gain in the SP500 by +10.3% over the next fourteen months.

Goldman Sachs forecasts S&P 500 could hit 6,500 by end of 2025

https://finance.yahoo.com/news/goldman-sachs-forecasts-p-500-054053974.html

MY COMMENT

So they are predicting that in 14 months we will see the SP500 go UP by the amount that is usually goes up per year....if you look at the long term gains in the Index.

Seems like a pretty good probability prediction....as well as a really.....LAZY prediction. NOT exactly big news.

Reminds me of all the predictions that I saw for the SP500 for this year.....in the +6-9% range. Fortunately all the so called EXPERTS are usually totally wrong with these sorts of predictions. Basically.....media fluff.

 

WELL.....HELLO.

The NASDAQ has just turned GREEN for the first time today. At the same time we are seeing the losses in the other big averages moderating.

Looks like a little bit of REALITY poking its head into the markets. SHOCKING.

 

I will post this....in spite of it being....SHOCKINGLY OBVIOUS.

Nvidia must show Blackwell chip can drive growth in earnings report

https://www.cnbc.com/2024/11/19/nvi...chip-can-drive-growth-in-earnings-report.html

(BOLD is my opinion OR what I consider important content)

"Key Points

• Nvidia is on a historic run as its GPU chips are the technology industry’s tool of choice for making and deploying generative AI software.
• Investors will want to see whether Nvidia can continue to grow at a fierce rate when the company reports its third-quarter earnings on Wednesday.
• More important than Nvidia’s third-quarter results will be what the company says about demand for its upcoming Blackwell chip.

Despite rising competition, Nvidia holds 80% of the fast-growing market for artificial intelligence chips as the tech industry’s graphics processing unit, or GPU, of choice for making and deploying generative AI software.

What investors will want to see when Nvidia reports its third-quarter earnings on Wednesday is whether it can continue to grow at a fierce rate, even as the boom in AI enters its third year.

Nvidia is entering “uncharted territory” as it attempts to continue growing on a $3.5 trillion market cap, wrote HSBC analyst Frank Lee in a report this week.

“We have pondered this amazing growth trajectory and not only do we see no signs of a slowdown, we expect further upside in 2026 data center momentum,” Lee said in his note. He has a buy rating on the stock.

Future growth will have to come from Blackwell, its next-generation chip that has just started shipping to end-users such as Microsoft, Google and OpenAI. More important than Nvidia’s third-quarter results will be what the company says about demand for the Blackwell chip.

Nvidia CEO Jensen Huang will likely update investors about how that is shaping up on Wednesday, and he will potentially address reports that some of the systems based on Blackwell chips are experiencing overheating issues.

In August, Nvidia said it expected about “several billion” in Blackwell sales during the January quarter.

“Our base case is for NVDA to ship ~100K Blackwell GPUs in 4Q, which we believe is near the low-end of investor expectations,” Raymond James analyst Srini Pajjuri wrote in a note last week. He has a strong buy rating on the stock.

Since Nvidia’s last earnings report, the stock is up nearly 19%, capping off a stunning run that has seen the share price rise eightfold since ChatGPT was released in late 2022. Alongside the stock’s rise has been a fierce increase in sales and margin, and its forward price to earnings ratio has expanded to just under 50, according to FactSet.

Growth is slowing, but that is partially because Nvidia’s top line is so much larger than before. Nvidia reported 122% growth in sales in the most-recent quarter. That was lower than the 262% year-over-year growth it reported in the April quarter and the 265% growth in the January quarter.

Analysts polled by LSEG are expecting around $33.12 billion in revenue, which would be nearly 83% growth compared to a year ago. The company is also expected to post 75 cents in earnings per share, according to LSEG consensus estimates.

Nvidia’s data center business accounted for nearly 88% of sales in the most-recent quarter, taking the focus off the company’s legacy computer games business.

The company makes the chip for the Nintendo Switch, for example, which the Japanese video game company says is seeing major sales declines as the game console ages. Nvidia’s gaming business is expected to grow about 6% to $3.03 billion, according to a FactSet estimate. Its automotive business, making chips for electric cars, is still small, even though analysts expect it to grow 38% to about $360 million in sales.

But none of that will matter as long as Nvidia’s data center business continues to grow at a rate that is nearly doubling on an annual basis and Huang signals to investors that the party won’t end."

MY COMMENT

This party is FAR from over. Yes Blackwell will drive the numbers for the next year or two. BUT you can bet that NVDA is thinking way ahead of Blackwell. They are obviously working on the next one or two chips beyond Blackwell.

At some point the HUGE numbers will normalize....but...even that does not mean that the party is over. As long as this company can remain DOMINANT in the chip business.....even more normal numbers will drive shareholder value.

I will take the HUGE gains in share value for as long as they happen......and....after that I will continue to hold this company for the long term.....and enjoy the more normal returns and steady growth.

 

I highlighted in BOLD the point above that NVDA makes the chips used in the Nintendo Switch.

That product....the Switch.....is of interest to me right now. My little 7 year old Granddaughter is going to get a Switch for Christmas this year as well as four games to go with it.

ALL of her friends in the same age group are also now moving into their first video game system and the overwhelming choice seems to be....the SWITCH.

Anecdotal......but it seems to be a real consumer move that is sweeping the early age groups right now.....at least in my Granddaughters little upscale area.

Nintendo may be seeing sales of the Switch decline....but....from what I am seeing and hearing it looks like they might soon see a surge in this basic game system driven by the 5-9 age group.

 

I cant ignore this story today.....BUT......it is not exactly a ringing endorsement of the stock or the company.

Super Micro hires new auditor to maintain Nasdaq listing; shares pop 37%

https://www.cnbc.com/2024/11/18/sup...or-to-maintain-nasdaq-listing-shares-pop.html

 

WELL....time to sit and do nothing. I EXPECT the SP500 to be green by the end of the day. As to the DOW....I dont care....it is not an index that I pay any attention to.

That is my short term prediction......based on the BIG movement happening in NVDA right now.

SHOW ME THE MONEY.

 

OK.....I just looked for the first time today. I currently have a STRONG gain in my account.

I AM BEING SHOWN THE MONEY.....thank you.....NOW, KEEP IT UP.

 

OK......that is how we do it. the markets over the course of the day just gave the....finger....to the open today. I ended the day with BIG gains. I had seven of nine stocks green today. A couple were red....CMG and HD.

I also got in a very big beat on the SP500 today by 2.20%.

Moving on to NVDA day.

 

Of course six figure earners are flocking to Walmart. People are not stupid.

As Americans bargain shop, six-figure earners flock to Walmart

https://finance.yahoo.com/news/walmart-keeps-growing-shoppers-making-122909370.html

 

What if they tried to fear-monger WWIII and no one cared?

Well that was the markets today. By the end of the day both the NASDAQ and the SP500 were GREEN.

 

As to the above:

Nasdaq jumps 1% as Wall Street looks past Russia-Ukraine tensions, Nvidia shares surge

https://www.cnbc.com/2024/11/18/stock-market-today-live-updates.html

(BOLD is my opinion OR what I consider important content)

"The Nasdaq Composite gained Tuesday, driven by Nvidia shares, as investors shrugged of concerns of mounting geopolitical tensions between Ukraine and Russia.

The Nasdaq popped 1%, while the S&P 500 gained 0.5%. The Dow Jones Industrial Average
dipped 50 points, or 0.1%.

One bright spot was technology stocks and Nvidia, which gained nearly 5% ahead of its closely watched earnings report Wednesday. Walmart added 3% after posting better-than-expected earnings and hiking its outlook on strong discretionary spending. Tesla rose 2%, bringing its month-to-date rally to 38%. Shares are headed for their best month since January 2023. Alphabet and Amazon also added more than 1%.

“The underlying trend for the market is positive,” said Keith Lerner, Truist’s co-chief investment officer. “The geopolitical stuff — that’s certainly a risk — but you’re seeing some modest selling. I’m not seeing panic. It’s more of a digestion of the recent gains.”

The market pressure began overnight after Russian President Vladimir Putin warned the U.S. that the threshold for the use of nuclear weapons had lowered, a new stance coming after President Joe Biden allowed Ukraine to use U.S. weapons to strike inside Russia.

Then losses accelerated on news that Ukraine hit Russian border region Bryansk with U.S.-made missiles, according to the Russian military. The New York Times confirmed the attack, citing U.S. and Ukrainian officials. The attack was on an ammunition warehouse, according to the report.

“Rising geopolitical tensions has been and continues to be a risk for markets,” said Gaurav Mallik, chief investment officer at Pallas Capital Advisors. “The combination of Russia ratcheting up its war rhetoric and uncertainty about how the incoming U.S. presidential administration will respond, is a recipe for stock market volatility.”

Treasury prices increased as investors moved into the safe haven, driving yields lower. Gold futures also gained. The Cboe Volatility Index

(VIX), considered the best “fear gauge” on Wall Street, spiked around 16.

MY COMMENT

YEP....moving on with some good money gains today. Looking forward to the NVDA earnings tomorrow.

 

HAPPY NVDA DAY EVERYONE.

Although this is simply backward looking information that we will get today.....and.....is a single quarter. So.....YES.......just a tiny blip on a long term chart.

I am expecting a very good report. As to the impact on the stock price.....I have ZERO expectations considering the typical market reactions to good and great earnings that we often see.

In fact the short term and immediate reaction to the earnings is not very relevant....what counts is the long term growth of the company and the stock.

NVDA is DOWN at the moment.

 

I am also seeing many EARLY Black Friday sales going on with really good deals and prices. This is smart retail strategy considering the late Thanksgiving this year and short Christmas shopping season. With the very short time between Thanksgiving and Christmas.........companies are starting the sales early this year to try to extend the shopping season.

 

Here is a long article on the......MYTH....of the Social Security Trust Fund. Simply a big JOKE since there is actually NOTHING in the trust fund and the "special" treasury IOU's dont pay anything. The whole thing is simply pay as you go from government revenue each year. I dont necessarily agree with the FIXES talked about in this little article....but it does a good job of explaining the PHONY......."trust fund".

The Social Security Trust Fund Myth
Social Security Is a Legal Ponzi Scheme
The Social Security trust fund is a figurative piggy bank that holds only IOUs issued by the Treasury to the Social Security Administration, not actual money

https://www.cato.org/policy-analysis/social-security-trust-fund-myth#

MY COMMENT

Of course Congress and politicians SPEND all the Social Security taxes that are collected every year.

 

This is a very BIG STORY.

Target shares are down by OVER 20% today.

Compare these earnings and the recent Walmart earnings.

Target has never recovered from the DISASTER of their WOKE activism. I am not a shareholder but put this article up as an example of a business that lets politics and social issues get in the way of business. SHAME on management for allowing this to happen. They have now backed off but the damage is done.

I dont care what the politics or social leanings are of anyone....but when it comes to business (unless your focus is a very specific set of customers)......STAY OUT OF IT EITHER WAY.....just focus on executing your business model.

I dont understand why any general business would want to put themselves in the middle of these sorts of issues.....either way is going to piss off half your potential customers.

Target CEO 'guiding for some conservatism' as the retailer misses earnings estimates ahead of the holidays

https://finance.yahoo.com/news/targ...stimates-ahead-of-the-holidays-113031004.html

Walmart Stock Hits All-Time High as Sales, Profits Keep Growing

https://www.investopedia.com/walmart-q3-fy2025-earnings-8746984