One Pelosi Stock to lose money in 2022

House Speaker Nancy Pelosi’s husband, Paul Pelosi, posted a big loss last month when he sold a call option on chip stock Nvidia (NVDA). NVDA is currently facing some headwinds and is expected to continue in the coming months. The stock is down 56.2% year-to-date and could fall further. Therefore, it may be wise to avoid inventory. read more….

House Speaker Nancy Pelosi has frequently disclosed deals her husband recently made. This is because the law makes it illegal for lawmakers to use information from their work in Congress for personal gain. The law requires lawmakers to disclose stock trading by themselves or by her family within 45 days of her.

In a new transparency filing, a senior Democrat says her husband, Paul Pelosi, is the owner of chipmaker Nvidia Corporation (NVDA) The call option purchased in July 2021 suffered a loss of $361,476.

Shares of semiconductor makers are down 56.2% year-to-date and 47.8% over the past year, largely due to headwinds facing the semiconductor industry.

NVDA weakens its outlook for the third quarter of fiscal 2023. Revenue is expected to be $5.9 billion, plus or minus 2%, representing a sequential decline of nearly 12%.

The company is facing a significant decline in its graphics segment business, which reduced revenue and gross margin in its last reported quarter. The segment reported his 44% streak decline due to declining demand for GPUs and pricing power. The slowdown in GPU sales is due to a decline in cryptocurrency mining and his PC demand, which has impacted GPU prices.

The company reported in September that the US government had imposed new export restrictions to China on two of its most advanced AI chips, namely the Nvidia A100 and H100 graphics processing units. The latest technology sanctions have a negative impact on revenue. Sales for the quarter are expected to be her $400 million.

Reports say the company is pushing production to sell the chip in question, as there may be a temporary grace period before the ban takes effect. This will help mitigate some of the impact on earnings this quarter.

Here are some things that could affect NVDA’s results in the next quarter:

financial disappointment

NVDA’s non-GAAP gross profit for the second quarter ended July 31, 2022 was $3.07 billion, down 29.1% year-over-year. The company’s non-GAAP net income was $1.29 billion, down 50.7% from the prior year. Additionally, non-GAAP EPS decreased 51% year-over-year to $0.51.

Mixed analyst estimates

For fiscal years 2023 and 2024, NVDA’s revenue is expected to increase 0.4% and 15.6% year-over-year to $27.03 billion and $31.24 billion. Fiscal 2023 EPS is expected to be $3.36, down 24.3% year over year. However, fiscal 2024 EPS is expected to grow 32.6% year-over-year to $4.46.

extended evaluation

In terms of forward EV/S, NVDA’s 12.02x is 350% higher than the industry average of 2.67x. Similarly, its 11.88x forward P/S is 375.2% higher than the industry average of 2.50x. Its 52.09x EV/EBITDA 333.9% higher than the industry average of 12.01 times.

POWR Rating Reflects Dark Outlook

NVDA has an overall D rating, which is on par with our selling point. POWR rating system. The POWR Rating is calculated by considering 118 individual factors, with each factor being optimally weighted.

Our proprietary rating system also evaluates each stock based on eight different categories. NVDA’s value is a D grade, in line with its expanded valuation.

Like the 1.71 beta, the stability is D grade.

NVDA ranks 82nd out of 93 stocks. Semiconductor/wireless chip industry. click here Access NVDA ratings on growth, momentum, sentiment and quality.

Conclusion

Pelosi’s bet on NVDA didn’t pay off as the stock fell on concerns about declining demand and a growing GPU inventory. The company expects earnings to take a hit in the coming quarters.

Given the dismal financial situation and stretched valuations, it may be wise to avoid stocks for now.

How NVIDIA Corporation (NVDA) Do you stack up against your peers?

NVDA’s overall POWR rating is D, which corresponds to a sell rating. Therefore, STMicroelectronics NV (STM), Experi Holding Co., Ltd. (XPER), and United Microelectronics Corporation (UMC).

NVDA shares rose $6.59 (+5.11%) in pre-market trading on Thursday. The NVDA fell -54.00% while the S&P 500 Index rose -18.51% over the same period.

About the author: Dipanjan Benture

Dipanjan has been interested in the stock market since elementary school. This earned him a master’s degree in Finance and Accounting. Today, Dipanjan works as an investment analyst and financial journalist with a keen interest in reading and analyzing emerging trends in financial markets.

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