Nvidia (NVDA)
Nvidia stock is up over 70% in the past year and has beat all 4 of their last earnings calls. In the next 12 months analysts are estimating that Nvidia will be able to increase their earnings by 79% which is insanely high considering they are already the largest company in the world.
These high earnings estimates combined with a 36 PE give NVDA a PEG ratio of just 0.7 – much better than the S&P average of 1.8 right now. Nvidia’s valuation is still high at that 36 PE but some analysts are estimating that Nvidia currently holds as much of a 98% market share which definitely helps justify that premium.
The average analyst rating for NVDA is a Strong Buy with a +54% one year forecast, and we have it as medium risk high reward. Our current rating for Nvidia is a Buy with a +24% one year forecast. Even at the top, Nvidia is still proving it’s worth as a great growth stock that investors should seriously consider.
SOFI Technologies (SOFI)
Up over 80% in the past year, SOFI is comes highly rated among analysts right now. And like Nvidia, we are expecting 79% EPS growth over the next year – but while SOFI’s earnings estimates are slightly higher than NVDA, their PE is actually quite a bit higher at 48. This could be because the market is expecting SOFI to be able to hold onto those levels of growth longer than Nvidia just because the market cap is much smaller and thus in theory has a lot more room to grow (SOFI: $25B vs NVDA: $4.9T). This also gives SOFI a PEG of 0.6 which just beat’s Nvidia’s at their 0.7.
SOFI has beat all 4 of their last earnings calls and there is an upward trend in the fintech industry in general right now with industry growth forecasts of around 7.2% over the next few years. SOFI currently enjoys record levels of membership growth as well which they will need to keep up in order to meet their forecasted estimates.
Analysts on average hold a one year price forecast of +47% and a rating of a Strong Buy. We put this stock as medium risk, high reward and we have rated SOFI a Strong Buy with a 23% one year price projection.
Ultimately, the brutal truth of the matter is that both NVDA and SOFI both present incredible buying opportunities right now and it’s impossible to recommend one over the other given their similar growth projections and risk; and that each of them are still a Strong Buy despite the recent explosion of growth each of these stocks has recently experienced.
Topics: NVDA stock analysis, SOFI stock prediction
