Investors might be feeling hesitant to jump on Nvidia’s stock given its strong run. But some market experts think it’s not too late to jump on the bandwagon. Given this notion, traders may want to keep riding the stock to the moon.
Nvidia’s price increase the past year (over 260% the last 12 months and about 100% so far this year) has been well-documented. That’s because it continues to gain momentum on the prospect that artificial intelligence (AI) adoption will continue globally. Its strong outperformance has caused analysts to constantly adjust their price targets (typically higher).
“They are making their own weather and as long as they keep beating and raising (question will be not ‘if,’ but by ‘how much’), [Nvidia] is likely to remain the most owned and favored bet for investors in tech and [semiconductors],” said Mizuho desk-based analyst Jordan Klein.
On the topic of price targets, some think the stock could reach as high as $5,000 per share in 2030. If that run continues, traders may want to keep the Direxion Daily NVDA Bull 1.5X Shares (NVDU) as part of their arsenal of market tools. The fund adds an additional 50% of exposure to the stock to extract more profits should Nvidia continue climbing.
‘Magnificent Seven’ Still Magnificent?
Individually, certain members of the Magnificent Seven are doing better than others. But as a whole, market experts still think they live up to their magnificent moniker. Given the serendipitous run of specific Magnificent Seven members like Nvidia, it seems plausible to think that they’ve become overpriced. However, analysts at JPMorgan don’t seem to think so just yet.
“There is a concern over the very strong outperformance of the Magnificent Seven, but we note that the group is currently trading less stretched than a few years ago, given earnings delivery,” analysts said.
Even if stock prices do retreat, traders have tactical options, such as the Direxion Daily Concentrated Qs Bull 2X Shares (QQQU) and the Direxion Daily Concentrated Qs Bear 1X Shares (QQQD). QQQU and QQQD track the Indxx Front of the Q Index, which includes Nvidia. Both funds also provide even broader exposure to other the Magnificent Seven names like Apple, Google, Tesla, and Meta.
Tactically, QQQU can be used to double-up during uptrends. And of course, QQQD can be used when sell-offs occur, thereby giving traders flexibility when prices head up or down.
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