NVDA is a long-term short

2023年4月11日

NVDA has been tremendously overpriced for some time, trading as high as 40x book value at some points.

I believe that this is unsustainable and that we will see this stock waterfall to below $50.00 again.

There has been a 20.7% drop in chip demand year-over-year, and a 4% drop month-to-month in February. https://www.semiconductors.org/global-semiconductor-sales-decrease-4-month-to-month-in-february/

To contrast, AMD has roughly 4x the book value per share that NVDA does, and typically trades at 2x to 3x book value.

Look for earnings run up as a good entry point for a short position.

To clarify, this is a long term short, I believe it may take 1 to 2 years for us to see NVDA trading below 50 again.

Looking at the weekly MACD it also appears that upward momentum has been slowing down for some time. Combine this with ongoing, and incoming recession pressures and I believe we have an excellent catalyst for shorting NVDA.

2023年4月11日

註釋

An additional note to this, for folks who cannot short or have the funds the buy puts, given how expensive they may be for NVDA, look to get exposure through an inverted ETF like SOXS