Nvidia Stock: Panic or Opportunity? Is It a Buy Now?

The $52 billion CHIPS and Science Act, also known as the CHIPS Act, was signed by President Biden on Tuesday, yet chip stocks are selling off. What gives? Semiconductor stocks have been hit hard in recent days with both Nvidia (NASDAQ: NVDA) and Micron (NASDAQ: MU) announcing preliminary earnings results and lowering guidance.

As long-term investors, we look for megatrends to ride over several years and boost portfolio profits. I believe semiconductors are “the new oil.” Why? Consider all the secular growth trends and disruptive innovations we are experiencing and will continue to experience over the next decade. Here are several to consider:

  • Data centers
  • Cloud computing
  • Cybersecurity
  • Space exploration
  • Video gaming
  • Online gambling
  • Augmented reality
  • Virtual reality
  • Mixed reality
  • Autonomous driving
  • Electric vehicles
  • Genomics
  • Esports
  • 5G
  • E-commerce
  • Cryptocurrency
  • Artificial intelligence
  • Metaverse
  • Big data

What do all these growth trends have in common? They all require semiconductors. Then why is Nvidia selling off with the rest of the sector right now? I’ve got your back with the video below! Most importantly, the question you have is whether or not this is a buying opportunity. To answer this question, we first need to understand exactly what happened, then look at what could happen next. In the below video, I explain the situation for you and share where I think Nvidia stock is headed. Please don’t forget to subscribe to the channel for more stock market due diligence and earnings updates.

*Stock prices used in the below video were during the trading day of Aug. 9, 2022. The video was published on Aug. 9, 2022.

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Eric Cuka has positions in Advanced Micro Devices, Marvell Technology Group, Nvidia, and Qualcomm. The Motley Fool has positions in and recommends Advanced Micro Devices, Intel, Nvidia, and Qualcomm. The Motley Fool recommends Marvell Technology Group and recommends the following options: long January 2023 $57.50 calls on Intel and short January 2023 $57.50 puts on Intel. The Motley Fool has a disclosure policyEric is an affiliate of The Motley Fool and may be compensated for promoting its services. If you choose to subscribe through his link, he will earn some extra money that supports his channel. His opinions remain his own and are unaffected by The Motley Fool.

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