Jacob Brown
Traders in the U.S. equity options market anticipate a substantial market reaction to Nvidia’s upcoming earnings report, projecting a potential 11% swing in the stock’s price following the announcement.
According to data from options analytics service ORATS, this anticipated move would mark the largest expected fluctuation in Nvidia’s shares in the past three years, exceeding the stock’s historical average earnings move of 6.7%.
Implications for Market Dynamics:
Given Nvidia’s massive market capitalization of $1.8 trillion, such a move could translate to a significant shift in market value, potentially surpassing that of other prominent companies like Intel Corp and exceeding the market values of a substantial portion of S&P 500 constituents.
Surge in Options Trading Activity:
The heightened anticipation surrounding Nvidia’s earnings is reflected in the surge of options trading, with over 750,000 Nvidia options changing hands, making it one of the most actively traded single stock names in the options market.
Despite Nvidia’s impressive performance, particularly with its stock rising by approximately 50% this year, sentiment remains bullish, as evidenced by the elevated demand for upside options bets and the stock’s 90-day 25 delta call skew nearing a five-year high, according to Susquehanna analysis.
Continued Growth Trajectory:
Nvidia’s ascendancy to become the third most valuable U.S. company, surpassing Google-parent Alphabet, underscores its ongoing growth trajectory and market dominance.
Analysts are optimistic about Nvidia’s earnings prospects, with expectations of earnings per share of $4.56 and a significant rise in quarterly revenue, reflecting continued strong performance and market demand for its products and services.
