3 Growth Tech Stocks To Buy Now For 2021 And Hold
The company posted blowout and record Q3 results on Nov. 18, with overall sales up 57% and data center revenue up 162%. NVDA also posted strong gains in its gaming unit, which jumped 37% to account for roughly 50% of total revenue.
NVDA stock appears to be taking a much-needed breather after its big run in 2020. NVDA shares have moved sideways since its report and they have trailed the chip industry over the trailing three months, up 6% vs. 15%. The stock has hovered just above and below its 50-day moving average during the last month and a half, which could mean it’s due to breakout at some point.
Back in September, NVDA made a splash when it announced its acquisition of Arm Limited from Softbank (SFTBY Quick Quote SFTBY - Free Report) for $40 billion, most of which will be paid in stock. Arm is one of the most important behind-the-scenes companies in the market. It designs and licenses the basic blueprints of chips that consume the least amount of energy, which are used in roughly 90% of the world's smartphones. Yet, the biggest chip deal in history faces a tough regulatory approval process in the U.S., China, and the U.K.
Even if NVDA’s Arm deal doesn’t go through, it’s well-positioned for the future. Zacks estimates call for its Q4 sales to surge 55% and 45% in Q1 FY22, with its adjusted earnings projected to climb by 48% and 40%, respectively. NVDA’s longer-term sales and earnings outlook appears strong as well. And its bottom-line trends help Nvidia grab a Zacks Rank #2 (Buy), alongside an “A” grade for Momentum. And 19 of the 26 brokerage recommendations Zacks has for Nvidia come in at a “Strong Buy,” with three more at a “Buy.”
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