NVIDIA (NASDAQ:NVDA) Shares Down 4.2% - Here's Why

NVIDIA Co. (NASDAQ:NVDA) experienced a notable decline in its stock price, falling by 4.2% during trading on Tuesday. The stock hit a low of $135.82 before settling at $136.02 at the close. During mid-day trading, approximately 344,941,875 shares exchanged hands, marking a 13% decrease from the average daily trading volume of 396,640,844 shares. This decline comes after the stock's previous close at $141.95.

Wall Street Analyst Insights

Analysts from various firms have weighed in on NVIDIA's stock. Citigroup raised its price target from $170.00 to $175.00 while maintaining a "buy" rating. Melius Research also increased its target from $165.00 to $185.00, giving NVIDIA a "buy" rating. Benchmark set its new price objective at $190.00, and Wedbush also lifted its target from $160.00 to $175.00, rating the stock as "outperform." Additionally, Loop Capital confirmed a "buy" rating with a price target of $175.00. The current consensus rating is a "Moderate Buy" according to MarketBeat, with a consensus price target of $164.15.

NVIDIA Stock Performance Overview

NVIDIA's recent stock performance shows its 50-day moving average at $134.39 and its 200-day moving average at $122.84. The company is characterized by a low debt-to-equity ratio of 0.13 and a quick ratio of 3.64, indicating financial stability. The market capitalization stands at $3.34 trillion, featuring a PE ratio of 53.53 and a PEG ratio of 2.60. The stock also has a beta of 1.66, meaning it is relatively volatile compared to the overall market.

On November 20th, NVIDIA released its quarterly earnings, reporting earnings per share (EPS) of $0.81, exceeding analysts' expectations of $0.69 by $0.12. Revenue for the quarter reached $35.08 billion, surpassing projections of $33.15 billion. This represents a staggering 93.6% increase in revenue year-over-year, compared to $0.38 EPS during the same period last year. Analysts predict an average EPS of 2.73 for the current year.

NVIDIA's Dividend Announcement

Additionally, NVIDIA has announced a quarterly dividend of $0.01 per share, set to be paid on December 27th to investors of record as of December 5th. This annualizes to a total dividend of $0.04, resulting in a yield of approximately 0.03%. The current payout ratio stands at 1.57%. Furthermore, NVIDIA authorized a $50 billion share buyback program, indicating confidence from its board in the company's valuation.

Insider Transactions

Insider trading activity has also been noteworthy. Director Tench Coxe sold 1,000,000 shares at an average price of $119.27 on September 19th, amounting to a total sale of $119,270,000. Post-sale, he retains 5,852,480 shares valued at roughly $698 million, reflecting a 14.59% decrease in his stake. Another insider, Donald F. Robertson, Jr., sold 4,500 shares on September 20th, which equated to about $524,295. In the last quarter, insiders sold a total of 2,156,270 shares valued at $254 million, with insiders holding 4.23% of the company’s total stock.

Institutional Investors in NVIDIA

Institutional ownership of NVIDIA stands at 65.27%, with several hedge funds recently adjusting their positions. Lowe Wealth Advisors acquired a new stake valued at $25,000 in the second quarter, while DHJJ Financial Advisors raised its holdings by 1,900%. CGC Financial Services and Koesten Hirschmann & Crabtree also both made new acquisitions in NVIDIA during the second quarter. As institutional participation increases, it reflects a growing interest in NVIDIA's long-term growth potential.

About NVIDIA

NVIDIA Corporation specializes in graphics and computing solutions, providing GeForce GPUs for gaming, cloud services, automotive platforms, and software for the creation of virtual environments. The company's extensive reach spans the United States, Taiwan, China, and beyond.

Conclusion

As NVIDIA continues to navigate the evolving technology landscape, stakeholders are keenly watching how market conditions, analyst ratings, and insider activities influence its stock performance. Investors might consider how these factors align with their long-term investment strategies.

NVIDIA, Stocks, Investors