Nvidia Poised for Comeback as Earnings Growth Expected to Double

Nvidia's stock has been on a rollercoaster ride over the past year, only to recover and surpass its previous highs after each earnings report. The AI chip leader is expected to post nearly double-digit revenue and earnings growth when it announces its latest financial results on August 26.

The company's shares have been trading at a discount to the market despite its impressive growth, with analysts predicting revenue will jump 96% year-over-year to $91.85 billion for the fiscal second quarter. Earnings per share are expected to nearly double to $2.08 after ringing up a profit of $1.05 per share in the previous year.

Nvidia's recent history suggests it may beat expectations, but its stock price tends to move lower after each earnings report before rebounding weeks or months later. This time around, the company is trading at a relatively low valuation, with a 22 times forward P/E ratio and less than 16 times next year's target.