Welcome to “Stock of the Week”, a recurring series focused on companies experiencing meaningful news flow or changes in their investment case. The objective is not to react to headlines but to understand what is happening beneath the surface and whether recent developments materially affect the long-term investment thesis.
Each article applies the Quality Stocks Investment Framework to assess business quality, return potential and execution, in order to determine whether the stock is Attractive, Conditional, or Unattractive at the current price. A standardized one-pager accompanies each edition to make the decision process clear and easy to follow.
For paid subscribers, Stock of the Week goes a step further by opening up the full reasoning behind the investment thesis and decision process:
Detailed TSR calculations, including all underlying assumptions. This allows investors to understand what must go right for the investment to deliver acceptable returns and to stress-test their own expectations against explicit inputs
My analysis beyond the overall verdict. This provides a deeper insight, enabling investors to form an independent view rather than relying solely on a conclusion
This week’s spotlight is on NVidia. The company has once again defied gravity. Despite sky-high expectations, the company delivered a triple-beat, surpassing revenue, margin and guidance forecasts. With the Data Center segment now generating over $75B in a single quarter, analysts are once again increasing their forecast. Does this magical growth have a ceiling? My deep dive into the fundamentals follows
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One Pager
The stock at a glance
Want to understand how the Quality Stocks Investment Framework works? This article breaks it down for you
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Recent news
NVidia reported a record-breaking first quarter for fiscal 2027 with revenue hitting $81.6B which represents a staggering 85% YoY growth
The data center segment continues to be the primary engine of growth reaching $75.2B in revenue
Profitability remains at an elite level with non-GAAP gross margins holding 75% despite the complex production ramp of the new Blackwell chip architecture
Shareholder returns have been aggressively prioritized with the board authorizing a massive new $80B (1.5% of the market cap) share buyback program alongside a strong increase in the quarterly dividend
Management has introduced a new reporting framework that splits operations into Data Center and Edge Computing to better reflect the diverse ways AI is being deployed across industries
The transition to the Blackwell architecture is moving at a historic pace with hyperscalers and AI-native cloud providers quickly absorbing all available supply for large-scale model training
Future growth is being de-risked through the unveiling of the Vera Rubin platform which includes a new dedicated CPU designed specifically to lower the cost of agentic AI workflows
Analysts have responded to the results by significantly lifting FY revenue forecasts toward the $300B range as the company shows no signs of a cyclical slowdown
Operating leverage is exceptionally strong as net income continues to grow at a much faster rate than operating expenses despite heavy investments in next-generation R&D
Guidance for the upcoming second quarter remains highly optimistic with revenue expected to reach $91B driven by sustained demand for high-performance networking and compute
Recent analyst recommendation updates
May, 22. Daiwa Securities. Buy. $215 —> $255
May, 22. Citic Securities. Buy. $242 —> $315
May, 22. New Street. Buy. $343 —> $340
May, 21. Truist Securities. Buy. $287 —> $307
May, 21. Jefferies. Buy. $275 —> $300
May, 21. JP Morgan. Buy. $265 —> $280
To go beyond the initial assessment, paid subscribers unlock the detailed TSR calculation with underlying assumptions and my analysis of the situation, providing deeper insight into how recent developments affect risks, opportunities and the overall verdict
