It Could Be a Huge Week for These Nvidia ETFs

Core Viewpoint - Nvidia's upcoming earnings report is critical for assessing investor sentiment towards AI and the broader market, especially as notable investors have exited their positions [1][2]. Financial Performance Expectations - Wall Street anticipates Nvidia will report earnings per share (EPS) of $1.25 on sales of $54.9 billion for Q3, reflecting a 56% year-over-year revenue increase [2]. - Analysts project Nvidia's sales will reach $286.7 billion by 2026, indicating significant growth potential [3]. Market Sentiment and Trading Strategies - The earnings report could lead to volatility in related ETFs, with potential for the bearish Direxion Daily NVDA Bear 1X Shares (NVDD) to rise if results disappoint, while the bullish Direxion Daily NVDA Bull 2X Shares (NVDU) could surge if results exceed expectations [4]. - Nvidia's stock is considered richly valued, suggesting limited room for error in earnings performance, which places pressure on the company to meet or exceed Wall Street estimates [4]. Valuation Insights - Nvidia's stock is viewed as fairly valued with a long-term fair value estimate of $225 per share, implying an equity value of $5.1 trillion. This suggests a fiscal 2026 price/adjusted earnings multiple of 50 times and a fiscal 2027 multiple of 30 times [5].