Nvidia had a spectacular week.
I have a couple of observations.
Like always, I encourage long-term holding. NVDA wasn't always the powerhouse it is today. In the quarters from 2009 to 2011, they had some losses, but most importantly they were moving in the right direction with their fundamental metrics.
I remember how I became interested in NVDA. My son wanted one of their graphics processing cards. We got one and shortly thereafter I picked up some shares. Like many investors do, I sold 1/2 of my shares because I didn't see progress fast enough. Big mistake. Nonetheless, I continued to hold 1/2 which became a "rocket ship".
My second observation is to watch the financial fundamentals. See the attached PDF of their sales, EPS and ROE since 2000. So many buy equities without ever looking at the most basic fundamentals. I consider that to be a serious impediment as much as I would consider driving at 80 MPH with a blindfold on to be.
My third observation is there are no straight lines. Like most people's careers, a company's success ebbs and flows. There are fits and starts. The key, again like a career, is continuing to operate in a fundamentally sound way. Failures are a given but finding success entails learning from those challenges.
Looking at NVDA's numbers (again, some are attached) over the last 20+ years, it is clear that they had some really bad years and some really great years.
Lots of the time, meteoric stock's prices are built on pure "stories". NVDA is unlike that because it clearly shows great numbers and has been putting them up for some time now.
My last point is to always have a margin of safety. Owning NVDA at $8 is significantly different than owning it at $780. In one case, a $20 drop in the current price means little, whereas in the other case, a $20 drop in the current price puts the holder at a swift loss.
Be smart, be well-read, be aware and be successful.
