As Nvidia prepares to release its first-quarter earnings for fiscal year 2025, Kevin Mahn, CIO of Hennion & Walsh, discusses the expectations for the chipmaker and how it may impact the market. The company is expected to report earnings per share of around $5.22, a significant 406% increase year-over-year. Mahn anticipates Nvidia will reveal more data centers, a crucial part of the AI ecosystem, with data centers projected to consume 10% of the country’s electricity by 2030. Mahn believes Nvidia could emerge as the ultimate winner in the AI race with its new Blackwell chips, promising 25 times lower cost and electricity consumption. He notes that Nvidia is expanding to offer a complete AI solution and increase capital expenditures in data centers, indicating continued growth.
Beyond Nvidia, there are opportunities in the industrial sector supplying electricity, infrastructure, and cooling solutions to data centers, as well as Ethernet switches that power and run data centers efficiently. Despite concerns about Amazon pausing orders with Nvidia in anticipation of the Blackwell chips’ release this year, Mahn remains optimistic about Nvidia’s future earnings growth. Blackwell is expected to deliver significant cost and energy efficiencies, positioning Nvidia for continued success.
Mahn emphasizes the importance of considering Nvidia’s expansion into data center expenses and growth in the market, indicating potential for even higher growth in the future. While Nvidia’s stock has already seen a 90% increase this year, expectations remain high, but Mahn believes the company is well-positioned to meet and exceed these expectations with the upcoming release of Blackwell chips. As a value-oriented investor, Mahn acknowledges Nvidia’s relatively high multiples but suggests that based on earnings expectations, the stock may not be too expensive.
In conclusion, Kevin Mahn’s insights highlight Nvidia’s potential to dominate the AI market with its innovative new chip technology and strategic expansion into data centers. Despite some concerns about customer orders and high stock valuations, Mahn remains optimistic about Nvidia’s future growth prospects. Investors will be eagerly awaiting Nvidia’s earnings report to gain further insights into the company’s performance and outlook in the rapidly evolving tech industry.
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https://finance.yahoo.com/video/nvidia-could-ultimate-winner-ai-230000741.html