Nvidia is Monday's pick for IBD 50 Growth Stocks To Watch as the artificial intelligence leader reclaimed a closely watched moving average last week. The Magnificent Seven stock was looking to keep its winning streak going in midday trades Monday.
Nvidia stock gained around 1.7% Monday as it strives for its sixth straight day of gains, though volume is lighter than average.
Nvidia stands as the leader in designing specialty chips used in data centers, gaming, visualization and automotive products. It also holds a dominant spot in AI hardware and software.
It's not surprising that it ranks No. 1 out of 39 stocks in the Electronics-Semiconductor Fabless group, which ranks No. 34 out of the 197 IBD industry groups. The stock regained its trifecta of best-possible scores of 99 by Investor's Business Daily Composite Rating, Earnings Per Share Rating and Relative Strength Rating.
Nvidia Stock Reclaimed Critical Level
Nvidia stock retook its 50-day moving average Thursday after undercutting the critical level on July 24. It's clawing back from the bottom of a stage-three undefined base, according to MarketSurge chart analysis. The base has an official 140.76 buy point, but an early entry at 136.15 can be used.
Shares jumped nearly 19% last week and are up 155% so far this year. This follows two weeks of steep drops in heavier-than-average volume. The IBD Leaderboard stock is recovering after a sharp sell-off that started in mid-July and picked up momentum in late July.
The stock felt pressure after Meta Platforms and Google-parent Alphabet chief executives spoke of AI spending fatigue. It took another hit on news that its new Blackwell AI chip release may be pushed back by at least three months.
But the stock's quick improvement shows why it's a market leader and is reflected in its relative strength line, which is approaching previous June highs.
Triple-Digit Profit Growth Expected
FactSet estimates call for current-quarter earnings growth to slow to 138% after monstrous increases topping 400% in the last four quarters.
Analysts see sales rising 112%, which also lags the more than 200% growth over the last three quarters. Wall Street expects fiscal 2025 profit growth of 108%, then 39% in 2026.
Nvidia's fiscal second-quarter earnings are due Aug. 28.
Nvidia stock holds an Accumulation/Distribution Rating of E, which indicates institutions have unloaded the stock in heavy selling over the last 13 weeks.
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