Why is Nvidia Stock (NVDA) in the spotlight today?
Traders are buzzing around nvidia (NASDAQ:NVDAToday’s stock. There are two possible explanations: recent comments from analyst Ray Wang and new licensing requirements from the US government.
First, Ray Wang recently argued that the group of popular stocks – called “FAANG” shares – should be changed to a completely different group. Wang calls this set “Matana” and includes NVDA Stock among the names.
You may have heard of tech-focused FAANG stocks before. The group includes meta pads (NASDAQ:dead) (formerly Facebook), Amazon (NASDAQ:AMZN), apple (NASDAQ:AAPL), Netflix (NASDAQ:NFLX) And the the alphabet (NASDAQ:The GoogleNasdaq:The Google). TV personality Jim Kramer first coined the term “FAANG” in 2013, when the five companies dominated the US tech market.
However, Constellation Research principal analyst and founder Ray Wang feels it is time to change focus from FAANG to MATANA. This new shortcut includes Microsoft (NASDAQ:MSFT), apple, Tesla (NASDAQ:TSLA), Alphabet, Nvidia and Amazon. Notably, Netflix and Meta Platforms are not included in the group anymore. Traders are likely to talk about the new NVDA stock listing.
On top of this news, investors are likely still considering another recent development. This includes the impact of new licensing requirements on Nvidia.
Licensing requirements may be an issue for NVDA stock
Today, a new article from The Wall Street Journal Remind traders of a notable issue for Nvidia. Apparently, recent financial reports “show that the chip maker’s business has been hit hard by overstocking and declining demand.” according to WSJ, Nvidia could also lose “up to $400 million in quarterly sales” due to new licensing requirements imposed by the United States.
Apparently, the United States will now request a license for future exports of certain types of chips to China and Russia. Nvidia doesn’t rely on Russia for big chip sales, but cutting back on shipments to China could affect its bottom line.
In fact, the The Wall Street Journal He even went so far as to say that Chinese chip shipment restrictions could affect Nvidia’s forecast “of approximately $5.9 billion in sales in the current quarter.” Investors may consider this effect today in some kind of delayed reaction, thus selling NVDA shares.
However, Nvidia shares are down less than 1% as of this writing. With the company joining the MATANA club, traders may decide to buy more NVDA in the near future.
Posted by David Muadle They have not held (directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the author, and are subject to InvestorPlace.com Posting Guidelines.