The maximum risk is $325, making return on risk 53.84%. Maximum gain on the trade is the $175 net premium received. For example, sell the Dec $150/$145 put spread for $1.75 net credit. More risk averse traders may want to consider selling a defined risk put spread in place of a naked put sale. Important to make sure you sell only as many puts as shares you wish to ultimately own. The net purchase price of $130 implies a 23.3% discount to the latest closing price for those looking to acquire NVDA stock.Įach put sold is an obligation to buy 100 shares of NVDA stock. If NVDA falls by less than that at expiration you get to keep the initial $2000 premium and move on. The $150 strike provides a 11.5% discount to the $169.50 closing price for NVDA stock. Of course, you can buy back the the initial put sold at any time prior to option expiration to close out the trade. The net purchase price for Nvidia equates to $130 ($150 strike price less $20 premium received) if NVDA stock is below $150 at December expiration. Your maximum gain on the trade is realized if NVDA stock closes above $150 at December option expiration. If you sell the Dec $150 put, you bring in $2000 in option premium upfront for each put option sold. She believes it is a buy in front of earnings. InvestorPlace contributor Vandita Jadeja likes NVDA stock at current levels as well. The lowest price target is a still rather respectable $217. TipRanks shows a consensus “ Strong Buy” rating with a $329.05 average price target for the 27 analysts covering Nvidia. The current P/E of 44, although still not cheap, now stands at the lowest level in the past year.Ĭertainly the analysts like NVDA stock. This combination of a stagnant stock price and earnings beats means the price/earnings (P/E) ratio has fallen considerable. NVDA has trounced earnings expectations each of the last four quarters yet the stock price has gone nowhere in that same time frame.

The whisper number, or what the analysts really think, is for $1.35 in EPS. Expectations are for $1.20 in earnings per share (EPS) on $8.1 billion in revenue. Nvidia (NASDAQ: NVDA) is due to report earnings on May 25.

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