Nvidia is set to report its earnings after the market closes, with expectations of an adjusted EPS of $1.76 and revenue of $78.86 billion. The options market indicates a potential stock price movement of approximately +/-6% in response to the earnings announcement. More importantly, the reaction to Nvidia's results could impact a variety of stocks across the AI ecosystem.
CNBC analyzed the S&P 500 to identify stocks that have historically shown strong reactions to Nvidia's earnings, focusing on their excess returns relative to the broader market. Advanced Micro Devices emerged as a key player, with a beta of 0.28, indicating it tends to generate excess returns in line with Nvidia's performance.
Other notable companies include Vertiv Holdings, Monolithic Power Systems, and Micron Technology, which also ranked highly in correlation with Nvidia's earnings. Additionally, companies involved in optics and connectivity, such as Coherent and Lumentum, as well as semiconductor equipment firms like Broadcom and KLA Corp, were identified as sensitive to Nvidia's earnings.
Interestingly, firms like Comfort Systems and United Rentals, which support data center infrastructure, also showed significant correlations, reflecting a broader investor interest in the AI infrastructure sector. Super Micro was highlighted as having the highest sensitivity to Nvidia's earnings, although its consistency was lower compared to larger semiconductor companies