The badly lagging SOX index (semiconductors) fell again today, even with DJIA up nearly 400 points.Tomorrow SOX will have further trouble following 2 major semiconductor disappointments tonight - Nvidia & Applied Materials. NVDA guided lower citing crypto biz(gee what a surprise)
Getting hard to justify NVDA's mega $156B market cap (14x sales) when yr-over-yr revenue growth sinks from 66% in Q1 to 40% in Q2 to just 23% in Q3 (NVDA forecast). On other hand with 3% sequential revenue decline accts receivables soared & DSOs jumped from 35 to 48(big red flag)
NVDA's inventories jumped 37% sequentially to $1.1B (on 3% revenue decline & a weaker forecast for next qtr.)Days sales of inventory jumped from 64 to 86 days seq. Free cash flow plunged 41% seq. NVDA joins several other tech faves(FB, NFLX,INTC,AVGO,MU) that have lost their mojo
Of course, NVDA's single-digit tax rate (7%) was a big boost. I've seen so many tech reports in the past quarter with single-digit tax rates.
