NVDA Nvidia Earnings - 11/17/2021 AH

Ticker: NVDA
Description of why you are requesting DD: People are talking about it in chat

I’m not taking a position on this at the moment, but people are talking about it, so thought I would make a thread on this so we can capture some of the information before the earnings call tonight.

As far as what happens with earnings and guidance, I wouldn’t be surprised if NVDA just meets whatever it is they said they were going to meet, or were expected to meet, and just keep their next quarter guidance on target. There were rumors about them cutting back 3000 series production, because they were already going to hit their revenue numbers, and didn’t want to eat into their 4000 series revenues for next year :man_shrugging:.

Definitely one of the more risky plays as Nov4 climb probably priced in a lot of hype/earnings

While all earnings plays are innately risky, NVDA has already had a nice run-up in the overall ecosystem of semiconductors. Especially from AMD’s run, NVDA had a sympathy run too - currently it stands over 33% for the past month. Unless they increase forward guidance and dramatically beat estimates, I feel like should experience a pull-back as those earnings could already be priced in.

For reference, AMD’s Q2 earnings and raised guidance pushed it, originally to $122.00, where it later fell and consolidated in the 100-110’s. Q3 earnings pushed AMD to where it is now, and there was a decent run prior to earnings. In this situation, NVDA has already had some dramatic runs from the 180-210 levels that it was sitting on during AMD’s 100-110 levels from its post Q2 earnings. I mean, similarly, we can also infer that the run we’ve seen on NVDA prices in their dominance in the market over AMD, coupled with pre-earnings run-up leading into a greate run. This comparison may be loose and could easily fall apart here, but in short, I’m basically saying it would be far riskier (in my opinion) to play calls here, rather puts would be likely to be profitable.

Seeing what’s happening with Tattooed Chef and ZIM post-earnings, you’re better off praying on your knees for the outcome you desire!

Providing a little insight on NVDA’s last earnings run for comparison to this one:

Last earnings were reported on a Wednesday as well and just before they were announced, SPY received bearish news and started tanking. This forced NVDA down in pre-market trading on Thursday and it popped at open but followed SPY downward in the latter part of the day only to resume it’s “real” run to $220 (from $189) on Friday.

Now I played this earnings and had a hypothesis that because SPY pushed NVDA down, it would likely run when SPY recovered. And it did.

This earnings has a similar setup except the downward momentum is at a different time. SPY was down during AH of the announcement so it didn’t really run at all. The pop the next day was likely caused by the lack of a AH run and the stock being so far down. This time around, it was able to run and opened high but THEN SPY started tanking.

So with that said, I wanted to point out that the current trend is very similar to NVDA’s last earnings and a Friday run could possibly be in the cards.

Keep in mind: This is dependent on a SPY recovery.

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