Louis Navellier shares his thoughts on the promising future of NVIDIA Corporation (NVDA). According to his advanced market quantitative system, there’s a significant surge underway that is likely to impact certain stocks, boosting some and deflating others.
Navellier predicts in his upcoming event, Prediction 2024, that this trend will significantly shape the market in the forthcoming period.
In June, a pivotal moment for NVIDIA was June 10, when the company’s stock began to be traded at its newly adjusted price following a 10-for-1 stock split. But a bigger surprise happened on June 18, when NVIDIA’s market cap soared to $3.35 trillion, surpassing Microsoft Corporation’s (MSFT) $3.317 trillion, rendering NVIDIA momentarily the largest publicly traded company.
Navellier’s prediction doesn’t cease here. He suggests that NVIDIA will breach the $4 trillion market cap threshold this year, then advance to a $5 trillion market cap by 2025.
The driving force behind this growth, according to Navellier, is the successor to NVIDIA’s popular Blackwell chips. NVIDIA invests over $2 billion in developing its advanced AI chips, creating a unique place where competition is secondary.
The Blackwell chips are generative AI, labeled by NVIDIA as the “defining technology of our time.” With the potential to power industries across the board, these chips play a central role in the new industrial revolution NVIDIA aspires to spark.
NVIDIA plans to launch new AI chips annually until the decade ends, positioning itself as a market leader. This ambition caught so much attention that a certain TV channel redefined the Magnificent Seven as the “Magnificent One and 499 other stocks” referring to the S&P 500.
Despite antitrust investigations into companies like NVIDIA, Microsoft, and Open AI by the Justice Department and the Federal Trade Commission, Navellier believes there might not be significant hurdles. One recent report even suggests these investigations “may ultimately come to nothing.”
Moreover, NVIDIA’s predicted earnings and revenue growth are substantial. Earnings for the current quarter are anticipated to more than double compared to last year—rising from $0.25 per share to $0.59. Revenue is projected to reach $26.43 billion.
Navellier predicts that NVDA is well on its way to surpass the $4 trillion market cap and progress to $5 trillion, provided its earnings growth continues, aided by positive earnings surprises in each of the last four quarters, and an increased outlook following these earnings beats.
Navellier also warns of potentially significant effects on the other 499 stocks in the S&P 500 due to mean reversion trading algorithms that certain financial firms employ after each earnings season concludes.
These algorithms, based on a non-linear neural algorithm, react to stocks that are overbought when volatility increases. They can elevate oversold stocks, but become ineffective without trading volume.
Navellier’s own approach relies on “liner” math, based on a trailing 52-week basis that includes quantitative rankings on time scales ranging from 30 to 270 days.
He will delve into this topic more deeply during his special event, Prediction 2024, where he will explore the financial mania that could lead to a transformed America.
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