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Time to Buy These Closely Watched Stocks? NVDA, SMCI, AAPL

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Technology stocks have remained at the forefront of market headlines all year long, with excitement surrounding AI and a resilient economy leading to outsized gains.

And over the past few weeks, three tech stocks in particular – Super Micro Computer (SMCI - Free Report) , Apple (AAPL - Free Report) , and Nvidia (NVDA - Free Report) – have been the three most popular stocks being searched for on the Zacks website.

Given their popularity, let’s take a closer look at how each presently stacks up.

NVDA Remains AI Favorite

NVDA shares have been the hottest topic of 2024, widely outperforming on the back of record-breaking quarterly results. The company’s earnings outlook remains bright across the board, with the current $2.80 Zacks Consensus EPS estimate for its current fiscal year suggesting 115% year-over-year growth.

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Image Source: Zacks Investment Research

Concerning its latest quarterly release, the AI favorite generated record quarterly sales of $30 billion, reflecting a 15% sequential jump from Q1 and an even more impressive 122% year-over-year climb. The company’s sales growth has been remarkable, with this period’s results penciling in the fourth consecutive quarter of triple-digit percentage year-over-year top-line growth.

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Image Source: Zacks Investment Research

Unsurprisingly, Data Center results were the true focal point of the release, which again delivered in a big way. Data Center sales reached a quarterly record of $26.3 billion, up 16% sequentially from Q1 and 154% on a year-over-year stack.

Jensen Huang was unsurprisingly bullish on the Data Center, stating, ‘Hopper demand remains strong, and the anticipation for Blackwell is incredible.’

As shown below, the company’s Data Center results have regularly blown away our consensus estimates as of late, with the most recent beat totaling a sizable $1.4 billion.

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Image Source: Zacks Investment Research

Apple Unveils iPhone 16 Pro

Tech titan Apple recently hosted its Apple Event, which showcased several new models of existing products. A few of the notable features of Apple’s new iPhone 16 Pro include better battery life, AI capabilities (coming in beta later this fall), and the biggest display screen yet.

The earnings picture is still in great shape for the tech titan, with analysts revising their expectations higher across the board over recent months.

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Image Source: Zacks Investment Research

The company’s iPhone results have been somewhat mixed as of late, delivering both misses and beats over the past year. A slowdown in China iPhone sales has been a thorn in the side of the company, which fell 6.5% year-over-year throughout its latest period.

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Image Source: Zacks Investment Research

Still, it’s worth noting that the company’s Services portfolio, which has shown great growth, has eased the blow from the iPhone’s slowing growth considerably. Services revenue of $24.2 billion throughout its latest period reflected a quarterly record, 15% higher than the year-ago figure.

The company’s Services results have consistently exceeded consensus expectations.

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Image Source: Zacks Investment Research

It’s been no secret that the company’s growth has been stalling, but perhaps recent news surrounding its new lineup of products can reverse the trend. Apple is in the very early innings of its AI offerings, a key aspect to keep in mind when sizing up its long-term prospects.

SMCI Faces Fraud Allegations

SMCI shares have been decimated since making their all-time high in mid-March, down more than 60% after an enormous run to begin the year. Shares faced pressure following the release of its recent quarterly results, with a recent short report from Hindenburg Research accusing the company of accounting manipulation not helping the stock either.

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Image Source: Zacks Investment Research

The company is a total IT Solution Provider for AI, Cloud, Storage, and 5G/Edge, fully explaining the buzz around the stock in 2024. Like NVDA, the company’s reported sales have shot higher, penciling in triple-digit percentage year-over-year growth rates in each of its last three quarters.

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Image Source: Zacks Investment Research

For those unaware, SMCI has had an interesting history, with the recent short report not the first time the company has been accused of fraud. In 2018, SMCI was temporarily delisted for failing to file financial statements, and by 2020, was charged $17.5 million by the SEC for “widespread accounting violations.”

And on August 28th, the company delayed the filing of its 10-K annual report, bringing about further scrutiny. Time will tell what happens concerning the recent short report, but the stock undoubtedly has some questions surrounding it, a critical development that investors should keep close tabs on.

Bottom Line

Tech stocks continue to be the craze, with their strong quarterly performances and the buzz surrounding AI pushing them higher all throughout 2024.

And concerning the ones investors have been most curious about, all three stocks above – Super Micro Computer (SMCI - Free Report) , Apple (AAPL - Free Report) , and Nvidia (NVDA - Free Report) – have been in high demand on Zacks.


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