Shares of NVIDIA (NASDAQ: NVDA) rose 14.6% in August, according to data from S&P Global Market Intelligence. This brings the graphics processing unit (GPU) specialist’s year-to-date 2018 return to 45.5% through Friday, Aug. 31.
Continue Reading Below
For context, the S&P 500 returned 3.3% in August and has returned 20.4% so far in 2018.
We can attribute NVIDIA stock's strong August performance to the company's release of robust second-quarter results on Aug. 16, along with its unveiling of its first GPUs based on its new Turing GPU architecture.
For the quarter, NVIDIA's revenue grew 40%, earnings per share soared 91%, and EPS adjusted for one-time factors surged 92%. While bottom-line results easily surpassed Wall Street's expectation, the market's initial reaction wasn't positive: It sent shares tumbling nearly 5% on the day after earnings were released because of concerns about revenue from the cryptocurrency market drying up more than expected. But the market seemed to come to its senses after digesting the results and taking in the company's new product announcements, as shares began their steady rise on the second market day following the earnings release.
Turing is the world's first GPU that enables real-time ray tracing. Among other things, ray tracing in real time will enable developers to achieve cinematic quality in their video games. A few days prior to the earnings release, the company unveiled three Turing-based workstation GPUs, and several days following the release it introduced its Turing-based GeForce RTX series gaming GPUs.
There's no need for investors to change investing course. Existing investors should enjoy the ride; it's not over.
Find out why Nvidia is one of the 10 best stocks to buy now
Motley Fool co-founders Tom and David Gardner have spent more than a decade beating the market. (In fact, the newsletter they run, Motley Fool Stock Advisor, has tripled the market!*)
Tom and David just revealed their ten top stock picks for investors to buy right now. Nvidia is on the list -- but there are nine others you may be overlooking.
*Stock Advisor returns as of August 6, 2018