Thai Electronics Stocks Leap after Nvidia Reports 400% Increase in Earnings

The near 100% increase in Q2 revenue reported from Nvidia Corp. (NVDA) last night (23 Aug) resulted in all technology and chips-related stocks to trade higher around the world.

As for the Thai market, leading the pack is DELTA Electronics Pcl that went up 7.3% to ฿110.5 per share, reaching 77x P/E, followed by KCE Electronics Pcl with an increase by 4.74% to ฿49.75 at 30x P/E.

SVI Pcl is also up by 3.18% to ฿8.1 with 11.5 P/E, along with HANA Microelectronics Pcl that gained 1.2% to ฿63.5 with 21x P/E.

The increase in Thai electronics stocks came after Nvidia Corp. (NASDAQ, NVDA), an American tech giant, announced outstanding 2Q2023 fiscal results that reflected high demand for chip processors for AI applications.

The earnings announcement on Wednesday pushed NVDA’s share price over +3.1% to $471 per share and $502 or +6.5% in the after hours. The boom on tech stocks led the tech-heavy NASDAQ Composite Index to go up to 13,721 or +1.6% to a weekly record high after falling to 13,290 last week.

The announcement from yesterday (23 Aug 2023) reported the revenue with +88% QoQ and +101% YoY at $13.51 billion, mainly from Data Center segment that accounted for $10.32 billion (+141% QoQ and +171% YoY.) Nvidia reported a net income of $6.7 billion for the quarter ended 30 July, representing an increase of +422% from the same period last year. Its high net income growth was the result of the gross margin that jumped over 25 percentage points from the previous quarter to 71.2%.

The results cause an increase in Generally Accepted Accounting Principles (GAAP) diluted earnings per share to increase +202% QoQ and +854% YoY to $2.48. Non-GAAP also increased to $2.7 (+148% QoQ and +429% YoY).

Should NVDA trade over $500 per share, the P/E ratio will be over 200x like TESLA last year, which is 10 times higher than usual stock at 20x – 30x.