2 Reasons to Buy the Dip on Nvidia Stock
Shares in Nvidia (NASDAQ: NVDA) have risen sharply this year, helped along by better-than-expected fourth-quarter earnings. That said, the semiconductor giant is still down roughly 30% from its all-time high of $333 in late 2021, meaning investors still have a chance to buy the dip. Let's explore two reasons the company is still a buy.
Like many tech companies, Nvidia performed poorly in 2022 as pandemic-era consumer trends faded. While the Federal Reserve compounded the problem by raising rates (which can hurt growth stock valuations), Nvidia's company-specific challenges are the core issue.
The company's industry-leading graphics cards are used extensively for gaming hardware and cryptocurrency mining -- two industries that tanked as people returned to in-person entertainment options and pivoted away from volatile asset classes. Nvidia's fourth-quarter earnings highlight the extent of this problem, with revenue down 21% year over year to $6.05 billion amid a 46% collapse in the gaming segment.
Source Fool.com
