Nvidia Stock Is Getting Cheaper While Tesla Just Keeps Getting More Expensive
Tesla stock was down in midday trading Thursday. The biggest factor likely was blowout quarterly results from Nvidia . Understanding how one impacts the other tells investors something about both value and price.
Nvidia stock rose 2.8%, while the S&P 500 and Nasdaq Composite fell 0.6% and 1%, respectively. Tesla stock fell 1.8%.
One consequence of the giant quarterly beat and small stock move is that Nvidia shares are far cheaper Thursday than they were Wednesday. Nvidia stock now trades for roughly 30 times estimated calendar year 2024 earnings.
Tesla stock, on the other hand, is trading for about 50 times 2024 earnings per share estimates of $4.78. Tesla earnings estimates are the same Thursday as they were Wednesday. Without anything happening to Tesla, the stock now looks much more expensive.
Black is a growth investor and uses some relative valuation metrics to help understand the intersection of price and value. A price-to-earnings-to-growth, or PEG, ratio divides a PE ratio by an earnings growth rate. The PEG ratio for the S&P 500 is about 2. The market trades for about 18 times earnings and earnings are expected to grow at roughly 9%.
Largest companies globally:
Nvidia stock rose 2.8%, while the S&P 500 and Nasdaq Composite fell 0.6% and 1%, respectively. Tesla stock fell 1.8%.
One consequence of the giant quarterly beat and small stock move is that Nvidia shares are far cheaper Thursday than they were Wednesday. Nvidia stock now trades for roughly 30 times estimated calendar year 2024 earnings.
Tesla stock, on the other hand, is trading for about 50 times 2024 earnings per share estimates of $4.78. Tesla earnings estimates are the same Thursday as they were Wednesday. Without anything happening to Tesla, the stock now looks much more expensive.
Black is a growth investor and uses some relative valuation metrics to help understand the intersection of price and value. A price-to-earnings-to-growth, or PEG, ratio divides a PE ratio by an earnings growth rate. The PEG ratio for the S&P 500 is about 2. The market trades for about 18 times earnings and earnings are expected to grow at roughly 9%.
Largest companies globally:
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Pinchie McPincher : I’m glad I was able to pick up Tesla at $109 and sell at 275. It’s just a shame I didn’t have more money at that time