NVIDIA Corp (NVDA, Financial) has recently captured the attention of investors and financial analysts alike, thanks to its strong financial performance and promising growth trajectory. With a current share price of $843.97, NVIDIA Corp has experienced a daily decrease of 2.32%, yet it boasts a significant three-month gain of 32.99%. A detailed evaluation using the GF Score indicates that NVIDIA Corp is poised for substantial future growth.
What Is the GF Score?
The GF Score is a proprietary stock performance ranking system developed by GuruFocus. It evaluates stocks based on five key aspects: financial strength, profitability, growth, GF Value, and momentum. These components are weighted differently and have been backtested from 2006 to 2021, showing a strong correlation with long-term stock performance. Stocks with higher GF Scores typically yield higher returns. For NVIDIA Corp, the GF Score is an impressive 93 out of 100, indicating a high potential for outperformance.
- Financial strength rank: 9/10
- Profitability rank: 10/10
- Growth rank: 10/10
- GF Value rank: 3/10
- Momentum rank: 6/10
Understanding NVIDIA Corp's Business
NVIDIA Corp, with a market cap of $2.1 trillion and annual sales of $60.92 billion, is a leader in the development of graphics processing units (GPUs). Initially focused on enhancing PC gaming experiences, NVIDIA's GPUs now play a crucial role in artificial intelligence applications. The company offers both AI GPUs and a software platform, Cuda, for AI model development and training. Additionally, NVIDIA is expanding into data center networking solutions, further solidifying its position in handling complex workloads.
Financial Strength Breakdown
NVIDIA Corp's financial robustness is reflected in its Financial Strength rating of 9/10. The company's Interest Coverage ratio stands at an impressive 128.29, indicating its strong ability to cover interest expenses. Furthermore, with an Altman Z-Score of 60.82, NVIDIA demonstrates a solid defense against financial distress. Its strategic management of debt is evidenced by a favorable Debt-to-Revenue ratio of 0.18.
Profitability and Growth Metrics
NVIDIA Corp's profitability is exemplary, with an Operating Margin that has significantly increased over the past five years, reaching 54.12% in 2024. The company's Gross Margin also reflects a steady increase, highlighting its efficiency in converting revenue into profit. NVIDIA's growth is equally impressive, with a 3-Year Revenue Growth Rate of 54.3%, outperforming 94.69% of its industry peers.
Conclusion
Considering NVIDIA Corp's robust financial strength, impressive profitability, and significant growth metrics, the GF Score highlights the company's unparalleled position for potential outperformance. Investors looking for similar opportunities can explore more companies with strong GF Scores using the GF Score Screen.
This article, generated by GuruFocus, is designed to provide general insights and is not tailored financial advice. Our commentary is rooted in historical data and analyst projections, utilizing an impartial methodology, and is not intended to serve as specific investment guidance. It does not formulate a recommendation to purchase or divest any stock and does not consider individual investment objectives or financial circumstances. Our objective is to deliver long-term, fundamental data-driven analysis. Be aware that our analysis might not incorporate the most recent, price-sensitive company announcements or qualitative information. GuruFocus holds no position in the stocks mentioned herein.
