NASDAQ:NVDA is not too expensive for the growth it is showing.

Our stock screener has spotted NVIDIA CORP (NASDAQ:NVDA) as a growth stock which is not overvalued. NASDAQ:NVDA is scoring great on several growth aspects while it also shows decent health and profitability. At the same time it remains remains attractively priced. We'll dive into each aspect below.

How do we evaluate the Growth for NASDAQ:NVDA?

To evaluate a stock's growth potential, ChartMill utilizes a Growth Rating on a scale of 0 to 10. This comprehensive assessment considers various growth aspects, including historical and estimated EPS and revenue growth. NASDAQ:NVDA has achieved a 9 out of 10:

• The Earnings Per Share has grown by an impressive 201.27% over the past year.
• NVDA shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 50.90% yearly.
• NVDA shows a strong growth in Revenue. In the last year, the Revenue has grown by 152.44%.
• NVDA shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 39.06% yearly.
• Based on estimates for the next years, NVDA will show a very strong growth in Earnings Per Share. The EPS will grow by 35.63% on average per year.
• NVDA is expected to show a strong growth in Revenue. In the coming years, the Revenue will grow by 35.61% yearly.

Assessing Valuation Metrics for NASDAQ:NVDA

To assess a stock's valuation, ChartMill utilizes a Valuation Rating on a scale of 0 to 10. This comprehensive assessment considers various valuation aspects, comparing price to earnings and cash flows, while factoring in profitability and growth. NASDAQ:NVDA has achieved a 5 out of 10:

• 64.49% of the companies in the same industry are more expensive than NVDA, based on the Price/Free Cash Flow ratio.
• The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
• The excellent profitability rating of NVDA may justify a higher PE ratio.
• A more expensive valuation may be justified as NVDA's earnings are expected to grow with 62.83% in the coming years.

A Closer Look at Health for NASDAQ:NVDA

ChartMill employs its own Health Rating for stock assessment. This rating, ranging from 0 to 10, is calculated by examining various liquidity and solvency ratios. In the case of NASDAQ:NVDA, the assigned 8 reflects its health status:

• An Altman-Z score of 73.43 indicates that NVDA is not in any danger for bankruptcy at the moment.
• NVDA has a better Altman-Z score (73.43) than 97.20% of its industry peers.
• The Debt to FCF ratio of NVDA is 0.15, which is an excellent value as it means it would take NVDA, only 0.15 years of fcf income to pay off all of its debts.
• The Debt to FCF ratio of NVDA (0.15) is better than 85.05% of its industry peers.
• A Debt/Equity ratio of 0.13 indicates that NVDA is not too dependend on debt financing.
• NVDA has a Current Ratio of 4.10. This indicates that NVDA is financially healthy and has no problem in meeting its short term obligations.
• NVDA's Current ratio of 4.10 is fine compared to the rest of the industry. NVDA outperforms 65.42% of its industry peers.
• NVDA has a Quick Ratio of 3.64. This indicates that NVDA is financially healthy and has no problem in meeting its short term obligations.
• With a decent Quick ratio value of 3.64, NVDA is doing good in the industry, outperforming 70.09% of the companies in the same industry.

Profitability Analysis for NASDAQ:NVDA

Discover ChartMill's exclusive Profitability Rating, a proprietary metric that assesses stocks on a scale of 0 to 10. It takes into consideration various profitability ratios and margins, both in absolute terms and relative to industry peers. Notably, NASDAQ:NVDA has achieved a 10:

• NVDA has a better Return On Assets (65.69%) than 100.00% of its industry peers.
• With an excellent Return On Equity value of 95.71%, NVDA belongs to the best of the industry, outperforming 100.00% of the companies in the same industry.
• NVDA's Return On Invested Capital of 78.60% is amongst the best of the industry. NVDA outperforms 100.00% of its industry peers.
• Measured over the past 3 years, the Average Return On Invested Capital for NVDA is significantly above the industry average of 11.13%.
• The last Return On Invested Capital (78.60%) for NVDA is above the 3 year average (31.07%), which is a sign of increasing profitability.
• NVDA has a Profit Margin of 55.69%. This is amongst the best in the industry. NVDA outperforms 98.13% of its industry peers.
• In the last couple of years the Profit Margin of NVDA has grown nicely.
• NVDA has a better Operating Margin (62.71%) than 99.07% of its industry peers.
• NVDA's Operating Margin has improved in the last couple of years.
• NVDA has a better Gross Margin (75.86%) than 94.39% of its industry peers.
• NVDA's Gross Margin has improved in the last couple of years.

Every day, new Affordable Growth stocks can be found on ChartMill in our Affordable Growth screener.

Our latest full fundamental report of NVDA contains the most current fundamental analsysis.

Disclaimer

This is not investing advice! The article highlights some of the observations at the time of writing, but you should always make your own analysis and invest based on your own insights.