This is just the beginning of Nvidia's long-term upside, says Bernstein's Stacy Rasgon
AMD AMONG THE TOPS THERE THEY LAG, AND IT LEADS TO OUR TALK OF THE TAPE NVIDIA BECOMING THE FIRST EVER CHIP STOCK TO REACH THAT MILESTONE, AN ASTOUNDING RUN FOR A STOCK THAT HAS JUST SIMPLY SOARED WHAT NOW THOUGH IS THE QUESTION? IS IT TIME TO PROTECT SOME PROFITS? LET’S ASK BRYN TALKINGTON. IT’S NICE TO SEE YOU HOW ARE YOU THINKING ABOUT THIS? ARE YOU TEMPTED TO TAKE SOME CHIPS OFF THE TABLE, AND HAVE YOU? >> I HAVE NOT. I HAVE POSITIONED APPROPRIATELY, AND AS I SAID LAST WEEK, NVIDIA WAS UNDEROWNED GOING INTO EARNINGS, AND
BOY, DID WE SEE HOW UNDEROWNED IT WAS. YOU’VE JUST SEEN A MASSIVE PILE-IN OF INVESTORS WHO HAVEN’T OWNED NVIDIA WHICH HAS BEEN A PUBLICLY TRADED COMPANY FOR 23 YEARS. I DO THINK THOUGH, THE MOVE IN GENERAL HAS GONE SO FAST, AND I THINK IT’S — I THINK IT’S GOTTEN TOO FAST, TOO QUICK BECAUSE, YOU KNOW, JENSEN SAID, SCOTT, ON THE CALL, THAT HE THINKS OVER THE NEXT TEN YEARS — NOT OVER THE NEXT TWO, BUT HE THINKS THAT DATA CENTERS ESSENTIALLY ARE GOING TO BE RECYCLED AND RECLAIMED USING ACCELERATED COMPUTING, BUT THAT’S TEN YEARS OUT,
AND I THINK CHATGPT CAPTURED ALL OF OUR IMAGINATIONS OF WHAT AI COULD DO IT CLEARLY CAPTURED NVIDIA’S MARKET CAP, BUT I THINK HOW COMPANIES MONETIZE,
ON “HALFTIME REPORT” AS HE SAID HE TRIMMED A QUARTER OF HIS POSITION LISTEN >> BASICALLY YOU HAVE ARGUABLY THE BEST STOCK IN THE WORLD, BUT IT’S 46% ABOVE ITS 50-DAY MOVING AVERAGE. THAT’S THE SIXTH HIGHEST READING EVER, AND YOU JUST HAVE TO SAY TO YOURSELF, HOW LIKELY IS IT FOR THERE TO BE STRONG GAINS IN THE VERY SHORT TERM FROM HERE? IT’S NOT IMPOSSIBLE, BUT THE LIKELIHOOD OF A REVERSAL GROWS >> SO EXPLAIN TO ME, YOU KNOW, GIVE ME THE PSYCHE OF SOMEBODY WHO LOVES THE STOCK WHILE AT THE SAME TIME SUGGESTING, YEAH THERE’S A
BUBBLE HOW CAN ONE EXIST AT THE SAME TIME >> IT’S ABOUT MANAGING YOUR POSITION, RIGHT? AS I SAID IN THE BEGINNING, HE STILL HAS 75% OF THE POSITION. HE SOLD 25%, AND SO I THINK THAT LONG-TERM INVESTORS THINK THAT WAY. JUST BECAUSE IT’S SO AMAZING WHAT’S HAPPENED, BUT IF YOU LOOK BACK, SINCE NVIDIA HAS BEEN A PUBLICLY TRADED COMPANY, THERE HAVE BEEN EIGHT YEARS WHERE IT’S HAD A RETURN OF OVER 100%, AND, IN FACT, IN 2001, IN 2016, THE STOCK WAS UP 300% AND, LIKE, 216% RESPECTIVELY, AND WE’RE NOT AT THOSE LEVELS YET. WHAT’S HARD
IS YOU HAVE TO KNOW HOW TO SIZE THE POSITION BECAUSE SO FEW PEOPLE OWN THE — GET THAT LONG-TERM RETURN OF STOCKS BECAUSE THEY JUST CAN’T BELIEVE IT’S GOING TO CONTINUE TO GO ON. >> LET’S BRING IN STACY ROSKA. WE HAVE BEEN WITH YOU EVERY STEP OF THE WAY BEFORE EARNING, AFTER EARNINGS, AND WE’LL TAKE THE PULSE YET AGAIN. IS THE PULSE BEATING TOO FAST? DO WE NEED TO SLOW THINGS DOWN >> WELLOOK, YES, SO THE SIGNIFIN UPSIDE WE’RE GETTING AT IS IT A PULL FORWARD, LIKE, FROM NEXT YEAR OR IS IT NOT? I DON’T
THINK WE KNOW YET. THAT BEING SAID, I THINK IT’S DEFINITELY NOT A PULL FORWARD OVER THE NEXT FEW QUARTERS THEY’RE HAVING THE DEMAND. THEY’RE HAVING DEMAND IN THE SECOND HALF. KNOWING VIDIA, THEY PROBABLY THINK THEY CAN BEAT THAT NUMBER. I WOULD NOT BE SURPRISED TO SEE NUMBERS CONTINUE TO GO UP IN THE NEAR TO MEDIUM TERM, AND THEN LOOK EVEN IF WE GET A PULL FORWARD — UNDOUBTEDLY IT WILL HAPPEN, AND THEY DON’T HAVE DIGESTION CYCLES, AND I THINK IT’S HARD TO ARGUE THAT THE OPPORTUNITY IN FRONT OF THEM IS NOT LARGE, AND THAT WE
ARE NOT EARLY. WE ARE CLEARLY EARLY THIS HAS JUST BEGUN. I THINK THE OPPORTUNITY IS ENORMOUS I THINK WE ARE AT THE PARADIGM SHIFT IN TERMS OF HOW DATA CENTERS AND HOW OTHER CENTERS ARE ARCHITECTED. IF WE LOOK AT 3 YEARS, 5 YEARS, 10 YEARS, I’M CONVINCED THE UPSIDE IS CONSIDERABLY MORE IN FRONT OF US THAN IT IS BEHIND US OVER THE NEX
