logo
3 key things Nvidia's CEO said in Paris, plus Capital One strikes a positive tone

3 key things Nvidia's CEO said in Paris, plus Capital One strikes a positive tone

CNBC11-06-2025
Every weekday, the CNBC Investing Club with Jim Cramer releases the Homestretch — an actionable afternoon update, just in time for the last hour of trading on Wall Street. Markets: Stocks were slightly higher in afternoon trading Wednesday, as investors digested cooler-than-expected inflation data and signs of progress on trade between the U.S. and China. Sentiment also was helped by the 10-year Treasury note auction at 1 p.m. ET, which observers graded as largely successful. As we wrote earlier , cautious optimism is the best way to describe where things stand on inflation and U.S.-China tensions right now. They are not the all-clear sign to start aggressively buying stocks, but they are still welcome. Nvidia update: A few comments caught our attention from CEO Jensen Huang during a question-and-answer with equity analysts at Nvidia's GTC Paris event. They came after Huang's keynote presentation and a flurry of announcements related to AI infrastructure projects in Europe. Our colleagues at CNBC abroad have a story out on those updates . Now, here are some of the highlights from the Q & A. As more devices such as smartphones and computers become capable of running AI applications "on device," Huang was asked about what that means for Nvidia's business model, given its market-leading AI chips run in vast data centers. "The more AI they use on the device, the more AI you're going to use in the data center because you still have to train the model. You have to develop the model and verify the model, evaluate the model. And all of that's done in the data center. Our business is not on the phone." Huang said Nvidia and its supply chain partners have made a lot of progress addressing the supply shortages that plagued the company during the early years of the generative AI boom. "None of the supply is horribly difficult to get now. It's constrained, but we're still growing fairly fast. So nothing is sitting around. We don't have ... a bunch of these supercomputers sitting around. They build what we ask them to build. So, we have to forecast it. But we're not limited by CoWoS. We're not limited by HBM. I just have to forecast, and our lead times are probably more than a year." (CoWoS is a method of chip packaging that had previously been a bottleneck for Nvidia's chipmaking partner Taiwan Semiconductor Manufacturing Co . HBM is shorthand for high-bandwidth memory chips, and tight supply also has been a sticking point in recent years.) Finally, Huang was asked about Nvidia's visibility into demand for next year, particularly in light of some of the European AI infrastructure announcements. While U.S. cloud computing giants like Amazon and Microsoft are Nvidia's biggest customers, the company has wisely been diversifying its revenue streams with "sovereign AI" projects in other parts of the world. Last month it was the Middle East, and now Europe is the focus. "Everything that I told you guys today is in addition to the [U.S. cloud service providers]. And most of Europe is underserved today. And even the parts that are served, the newest generation of [Nvidia] chips don't come out. You know, there are so many developers and researchers that are still using Amperes. They don't even have Hoppers barely. So that's the opportunity for the local [cloud service providers]. They could deploy the best as soon as possible. ... So all of this is incremental." (Ampere is Nvidia's AI chip architecture that went into full production in 2020, followed by the Hopper architecture in 2022. The generation that is ramping up now is Blackwell.) Consumer health: Capital One CEO Richard Fairbank struck a fairly positive tone on the state of the U.S. consumer despite macroeconomic uncertainty from President Donald Trump's tariffs, speaking Tuesday at Morgan Stanley's U.S. financials conference. "Despite all the noise out there and the tariff news and everything, even when we look at the very latest daily data on things like spending data or anything related to consumer behavior, we just don't see an effect. It's as if our consumers aren't really reading the same newspaper that we are. So, I'm cautiously optimistic about what I see." For the company specifically, Fairbank pointed out that since the fourth quarter of 2024, Capital One's delinquency trends have steadily improved. Zooming out further, the longtime executive also cited Friday's nonfarm payroll numbers , which indicated that overall job and real wage gains were both better than feared in May. All of this bodes well for Capital One's own financials. Its clients are not only able to pay back their minimums on their credit cards during a period of economic uncertainty, but also are still managing to spend consistently. At face value, Fairbank's remarks also are encouraging for our other consumer-facing names. Think retailers like Costco , Home Depot and Amazon , or chains like Starbucks and Texas Roadhouse , to name a few. If the consumer continues to spend, that's more sales for companies like these — and it's supportive for the U.S. economy overall, given the importance of private consumption to gross domestic product. Not every Wall Street executive is on the same page as Fairbank, though. At the same Morgan Stanley event Tuesday, JPMorgan CEO Jamie Dimon warned that the U.S. economy is vulnerable to a downturn. "I think there's a chance real numbers will deteriorate soon," he said. Up next: Oracle is set to report earnings after the bell, providing another look at data center demand and, perhaps, some thoughts on the energy requirements needed to build more AI infrastructure. On Thursday morning, we'll get the May producer price index report. The CPI report on Wednesday certainly carries more weight given that it revolves around what consumers actually pay. However, this PPI report should be a particular interest as investors look for clues as to what import tariffs have been doing to input costs and whether that could raise consumer prices in the near-term future. As of Wednesday evening, economists polled by Dow Jones are expecting see a 0.2% monthly increase, or 0.3% when stripping food and energy. Lastly, BlackRock's Investor Day ( webcast ) kicks off at 8:00 a.m. ET, which should provide more insight into how private market investments like Preqin are expected to contribute to growth in the future. — Investing Club portfolio analyst Zev Fima contributed to this report. (See here for a full list of the stocks in Jim Cramer's Charitable Trust.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust's portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.
Orange background

Try Our AI Features

Explore what Daily8 AI can do for you:

Comments

No comments yet...

Related Articles

European stocks that are likely to be winners and losers of the U.S.-EU trade agreement
European stocks that are likely to be winners and losers of the U.S.-EU trade agreement

CNBC

time27 minutes ago

  • CNBC

European stocks that are likely to be winners and losers of the U.S.-EU trade agreement

European automakers and pharmaceutical companies are emerging as the immediate winners in the aftermath of the U.S.-EU trade deal agreed on Sunday. The new accord removes the overhang of more punitive tariffs, providing a relief rally to stocks in the sector. Under the agreement, details of which have not yet been revealed, exports from the European Union to the U.S. will incur a 15% tariff, ending months of uncertainty. The clarity has been welcomed by investors, with analysts calling it a "positive catalyst." European stocks are rising around 1% on the news. However, the deal leaves the steel and aluminum industry in a state of uncertainty. Winners The European auto industry is the deal's most prominent beneficiary. The 15% tariff on cars is a significant reduction from the 25% tariff some vehicles faced and far less damaging than other rates that had been feared. Analysts at JPMorgan noted that the market had already anticipated the positive step, which was reflected in the rising share prices of automakers and suppliers over the week. Volkswagen shares have risen 12% in the past week. Deutsche Bank analysts said the tariff news "masked ... very solid underlying [second quarter] results," and highlighted the company's strong European business in contrast to rivals. "We see potential for a blue sky scenario in which there is upside potential from tariffs and a mass market business setting itself apart from competitors in Europe," said Deutsche Bank's Tim Rokossa in a note to clients on Monday. "VW remains our top pick in the space." Other European carmakers are also poised to benefit. The 15% rate is seen as "manageable" by JPMorgan analysts, with companies expected to mitigate the impact through a combination of increased production in the U.S. and modest price hikes. The Wall Street bank highlighted that BMW and Porsche had raised prices between 2% and 4% to mitigate the cost of tariffs. JPMorgan also noted that Volvo Cars CEO had said that "its customers would have to pay a large part of tariff-related cost increases" in a note to clients on Monday. A dose of certainty The pharmaceutical and biotechnology sector is another winner, primarily because the deal removes significant uncertainty. For Sartorius, a laboratory equipment and consumables supplier, the deal "removed the last lingering concern over the impact of tariffs," according to JPMorgan. The company's exports to the U.S. already faced a 10% tariff. "We believe that a 5 percentage point increase in the tariff rate, will likely be managed through an increase in the tariff surcharges, resulting in a further 1% annualised boost to revenues and leaving the impact of tariffs as neutral on [adjusted profit for the company]," JPMorgan's Richard Vosser said in a note to clients on Monday. Losers The outlook for the steel and aluminum sector is far less clear. Though the EU said "tariffs will be cut" in the future, exports from the continent to the U.S. currently face 50% tariffs. That ambiguity leaves major producers like ArcelorMittal with a mixed outlook. JPMorgan analysts described the company's investment case as "stranded" between currently weak steel prices and the hope for a trade deal that would boost its pricing power. Hydro, one of the world's largest aluminum producers, told CNBC that tariffs at 50% — in place since June — "will not change the current market dynamics". "We are supporting free and fair trade. One of our concerns has been the risk of an escalating trade war that would put weight on the global economy, leading to lower aluminum demand," a Hydro spokesperson said. "With more certainty on the trade agreements, this will likely reduce this risk." Despite the initial euphoria on European stock markets, strategists at UBS suggest the deal is likely to be damaging in the long run. "Importantly, while the deal reduces uncertainty and the risk of an escalation, it cements a marked deterioration in European firms' export conditions to the US," said UBS economist Reinhard Cluse in a note to clients on July 28.

Can Buying $10,000 of Nvidia Stock Still Make You a Millionaire?
Can Buying $10,000 of Nvidia Stock Still Make You a Millionaire?

Yahoo

time43 minutes ago

  • Yahoo

Can Buying $10,000 of Nvidia Stock Still Make You a Millionaire?

Key Points Nvidia would have to grow to nearly 4x last year's global GDP to turn $10,000 into $1 million. Achieving this goal is theoretically possible, but highly improbable. 10 stocks we like better than Nvidia › If you had invested $10,000 in Nvidia (NASDAQ: NVDA) on the day of its initial public offering in 1999 and never sold, you'd have a whopping $42.4 million today. Even if you had waited until 2015 to buy $10,000 of the stock and held on for the wild ride, your investment would be worth roughly $3.58 million now. But, as the old saying goes, hindsight is 20/20. Can buying $10,000 of Nvidia stock still make you a millionaire? What it would take Let's first address what it would take for a $10,000 investment in Nvidia to make you a millionaire. The math is simple: Since $1 million divided by $10,000 is 100, Nvidia would need to deliver a 100x gain. Most stocks aren't able to produce that kind of return, even over a lifetime. However, Nvidia has done it in less than nine years. Admittedly, it's hard to envision Nvidia doing it again. After all, the GPU maker now sports a market cap of over $4.2 trillion -- the highest valuation for any company ever. To turn $10,000 into $1 million, Nvidia's market cap would have to grow to a mind-blowing $420 trillion. To put that figure into perspective, the U.S. GDP last year was roughly $29.2 trillion. The GDP for the entire world was around $110.5 trillion. All Nvidia would have to do to make you a millionaire with a $10,000 investment is to grow to 3.8 times the economic output of every country on the planet. Easy, peasy, right? Potential scenarios It's hard to envision how Nvidia could grow 100x. However, I can come up with two potential scenarios where it could at least theoretically happen. The first scenario involves Nvidia achieving a revolutionary breakthrough that gives it a monopoly on technology that everyone wants. Maybe the company builds a teleportation device that allows people and products to be instantly transported anywhere. Perhaps a more likely goal would be to create AI superintelligence, an artificial general intelligence (AGI) system that's smarter than any human who has ever lived. Nvidia has teamed up with partners, including Turing, who are trying to develop AGI systems. The company's GEAR group (GEAR stands for "generalist embodied agent research") is trying to build foundation models, agents, and robots that might eventually achieve AGI. The second scenario requires time and consistently strong earnings growth. Nvidia's earnings jumped 31% year over year in the first quarter of 2025. Stock prices tend to track earnings growth over the long term. If we assume that Nvidia continues to grow by 31% for the next 17 or so years, its share price would increase by 100x. However, to deliver such stellar growth over such a long period, Nvidia might need a game-changing breakthrough mentioned in the first scenario. Facing long odds Is it possible that buying $10,000 of Nvidia stock right now could make you a millionaire? Sure. Is it probable? No way. The odds against Nvidia delivering a 100x gain are enormous. Of course, that's true for pretty much any other stock. However, I suspect that Nvidia could still make investors millionaires. It'll just take more money and potentially a long time. If you want $10,000 to turn into $1 million, though, you might have to find a smaller stock with tremendous growth prospects -- in other words, another Nvidia of 10 to 20 years ago. Should you buy stock in Nvidia right now? Before you buy stock in Nvidia, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Nvidia wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $636,628!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $1,063,471!* Now, it's worth noting Stock Advisor's total average return is 1,041% — a market-crushing outperformance compared to 183% for the S&P 500. Don't miss out on the latest top 10 list, available when you join Stock Advisor. See the 10 stocks » *Stock Advisor returns as of July 21, 2025 Keith Speights has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Nvidia. The Motley Fool has a disclosure policy. Can Buying $10,000 of Nvidia Stock Still Make You a Millionaire? was originally published by The Motley Fool

3 Tech Stocks to Watch During Earnings Season
3 Tech Stocks to Watch During Earnings Season

Yahoo

time43 minutes ago

  • Yahoo

3 Tech Stocks to Watch During Earnings Season

Key Points Nvidia is charging into its next quarterly report with a full head of steam. Analysts expect Roblox's revenue to grow 31%. A sector up cycle and AI advancements could improve Advanced Micro Device's value proposition. 10 stocks we like better than Nvidia › Tech investors are likely bracing for volatility as companies report earnings over the coming weeks. Big names are slated to report and give watchers a look at what's moving companies, industries, and the economy, and three Motley Fool contributors think tech investors may want to focus on reports from the following companies. Recent events bode well for Nvidia's stock momentum (Nvidia -- Aug. 27): AI chip leader Nvidia (NASDAQ: NVDA) is a must-watch when earnings season comes around. The stock has surged on continued AI-driven growth, making Nvidia the world's largest company by market capitalization as I write this in July 2025. A glance at the company's growth over the past few years reveals just how much AI has altered its trajectory, and the trillion-dollar question is whether AI tailwinds can sustain this performance. As I look around, the signs continue to indicate that the answer is yes. Companies throughout the AI landscape continue to show strong momentum and set high expectations for the future. For instance, Taiwan Semiconductor Manufacturing recently reported a strong quarter, including an increase in its full-year growth outlook. Meanwhile, Alphabet just reported in its Q2 earnings that cloud revenue grew by 32% year over year, and it is increasing its planned capital expenditures for this year by another $10 billion as it leans further into AI. To top things off, Nvidia recently announced that it planned to soon be allowed to resume selling its H20 chips to China after the U.S. government had barred those sales earlier this year. Additionally, Nvidia announced a new RTX PRO GPU that is fully compliant with export controls. The government's restriction on H20 sales earlier this year resulted in a $4.5 billion inventory write-off in Q1 for Nvidia and reduced Q2 sales guidance by $8 billion. If the export bans are lifted, that would be a welcome boost to Nvidia. The stock trades at a price-to-earnings ratio (P/E) of 55, which could prove to be a solid buy-in level in hindsight if the company achieves 29% annualized earnings growth over the long term, as Wall Street analysts anticipate. Can Grow a Garden deliver for Roblox? Jake Lerch (Roblox -- July 31): My choice is Roblox (NYSE: RBLX). There's a strong case to be made that Roblox's earnings report -- due on July 31 -- is among the most anticipated on Wall Street. Here's why. The company's stock is up 105% year to date, driven higher by the massive popularity of one of Roblox's games, Grow a Garden. Indeed, Grow a Garden has set multiple records in recent months, including the all-time record for concurrent users, with over 21 million players. That figure blew away the prior record of 14 million, set by Fortnite. So, with a smash hit on its hands, expectations are high for Roblox. But can the company live up to them? According to consensus estimates compiled by Yahoo! Finance, sell-side analysts predict Roblox will generate $1.25 billion in revenue for the second quarter (the three months ending on June 30), representing year-over-year growth of 31%. If the company can match or beat revenue expectations, it would largely justify the stock's massive rally so far this year. Moreover, Grow a Garden could be the catalyst that transforms Roblox from a promising -- but unprofitable -- company to one that can consistently turn a profit. That's why I'll be watching two key figures when Roblox reports: revenue growth and operating margin. As noted above, if the company can match or beat the 31% projected revenue growth, that's a bullish sign. Similarly, if Roblox can improve its operating margin, that would also be great news for bulls. It's been more than three years since Roblox posted an operating margin of better than -24%. Any improvement in that regard would be a major positive sign. Roblox stock has surged thanks to the success of Grow a Garden. Now, it's time to see whether its big hit is impacting the company's bottom line. AI-driven anticipation may influence the results for this chip stock Will Healy (Advanced Micro Devices -- Aug. 5): This earnings season, one stock I will be following closely is AMD (NASDAQ: AMD), which reports on Tuesday, Aug. 5, after the market closes that day. AMD's situation looks significantly different than when the company released its Q1 results on May 6. That was right after the selling following Donald Trump's "Liberation Day" tariff announcements depressed its stock price. Since that time, investors have learned more details about the company's MI400 AI accelerator and Helios rack-scale solution, scheduled for release next year. Obviously, those will not have a direct impact on the chip stock's latest financials. However, the data center segment, which designs AI chips, has become the company's largest segment and is often the fastest-growing part of the company. Also, many analysts have speculated that the MI400 will become a worthy competitor to Nvidia's upcoming Vera Rubin platform, which, if true, could bring considerable gains to AMD shareholders. Additionally, even with the solid performance of AMD's client (PC) segment, revenue declines in the gaming and embedded segments have reduced growth in recent quarters. However, revenue drops have become less pronounced in the gaming segment, and AMD reported only a modest revenue decline for the embedded segment in Q1. That bodes well for the upcoming report, and consensus analyst estimates point to revenue of $7.4 billion in the second quarter of 2025. That would amount to a 27% increase, down from 36% in Q1, but well above the 9% rise in the year-ago quarter. While its 116 P/E ratio may appear high, anticipated profit improvements have brought the forward P/E ratio looking at estimates down to 40, a relatively low level for a fast-growing tech stock. Assuming the Q2 report aligns with the growing optimism in AMD stock, it could continue its upward march back to its record high and beyond. Should you invest $1,000 in Nvidia right now? Before you buy stock in Nvidia, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Nvidia wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $636,628!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $1,063,471!* Now, it's worth noting Stock Advisor's total average return is 1,041% — a market-crushing outperformance compared to 183% for the S&P 500. Don't miss out on the latest top 10 list, available when you join Stock Advisor. See the 10 stocks » *Stock Advisor returns as of July 21, 2025 Jake Lerch has positions in Alphabet, Nvidia, and Roblox and has the following options: long July 2025 $150 calls on Advanced Micro Devices. Justin Pope has no position in any of the stocks mentioned. Will Healy has positions in Advanced Micro Devices. The Motley Fool has positions in and recommends Advanced Micro Devices, Alphabet, Nvidia, Roblox, and Taiwan Semiconductor Manufacturing. The Motley Fool has a disclosure policy. 3 Tech Stocks to Watch During Earnings Season was originally published by The Motley Fool Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data

DOWNLOAD THE APP

Get Started Now: Download the App

Ready to dive into a world of global content with local flavor? Download Daily8 app today from your preferred app store and start exploring.
app-storeplay-store