If you've been watching my channel for some time now, you probably know that i'm very bullish on nvidia. I personally think that it's a fundamentally strong company, that's well positioned in a growing industry, as you can imagine, when a massive acquisition was recently announced. I was excited to say the least what is going on moon gang, i hope you're having a great day. My name is matt and in this video i will be discussing nvidia's 40 billion dollar purchase of arm from softbank.

I will be sharing my own thoughts and opinions, as well as covering what wall street thinks about the deal and nvidia stock in general. If you enjoy this type of stock market related content, i would truly appreciate it if you could drop a like button, because it really helps with the youtube algorithm and getting this video in front of other people. And if you want to be a member of the moon gang subscribe to the channel and don't forget to turn on your notifications with that out of the way, let's rock and roll listen, i know your time is important and i personally hate when videos drag on. So i'll make this as quick as possible.

Nvidia is planning on spending 40 billion dollars to buy the chip designer arm from softbank. This would mark the largest semiconductor deal of all time arm. Design chips are at the heart of nearly every smartphone sold today for nvidia. The deal could boost its data center business and it could also boost its work in artificial intelligence, which is a big deal.

That i'll touch on in just a bit for nvidia arm represents a chance to boost its fast-growing business of selling chipsets and software to data centers. The massive networks of computers that power, large companies and cloud computing networks, in particular investors believe that nvidia could closely integrate arm cpu technology with nvidia's specialty in graphics, processors to build a large on the rest of the semiconductor industry. In other words, what we have here is the making of a technological giant. Nvidia is planning to pay softbank as much as 40 billion dollars for arm the particular details of the deal are highlighted now in return, nvidia will obtain control over arm's technology, which powers billions of mobile devices, combining arm's vast device, ecosystem with nvidia's, leading graphics, processing and Artificial intelligence capabilities would create a technological titan in the global computing industry.

Here's a quote from nvidia's ceo that i thought was pretty insightful. Ai is the most powerful technology force of our time and has launched a new wave of computing in the years ahead. Trillions of computers running ai will create a new internet of things that is thousands of times larger than today's internet of people. Our combination will create a company fabulously positioned for the age of ai.

This is obviously pretty exciting stuff, but i want you to know that this acquisition is not a done deal. It has to be finalized by the government. Gaining their approval will be no easy feat and regulatory approval is expected to come. No sooner than 18 months.

From now, if at all clearly, this approval could still fall through, but let me better explain why it would be such a big deal if it doesn't. Nvidia operates in three primary business sectors: gaming, ai and data centers. Now nvidia has long been dominant in gaming, which makes up most of its revenue. Second, is data centers where the company has been making up ground on both intel and amd, and third is ai, which contributes least to the company's revenue.

This potential acquisition of arm is pretty exciting because it would make nvidia more competitive in both data centers and ai. Now it might take a few years to be realized, but i would be willing to bet that this acquisition, in the long run, will boost nvidia's bottom line and, to top it all off. This improved technology will make nvidia's gpus more attractive in the world of 5g, which, if you believe all the hype, will be a massive market. Besides all the regulatory concerns, not everything about this deal is bullish, namely the cost 40 billion dollars is a lot for a company that has 11 billion in cash 14.6 billion in total current assets, 25 billion in total assets, 2 billion in total, current liabilities and 11.2 Billion in total liabilities, currently nvidia's total revenues is 13 billion, their gross profit is 8.3 billion, and their net income is sitting just below 3.4 billion.

So even though nvidia is showing considerable growth, the 40 billion dollar price tag is definitely considerable. Now i know that there are various ways to finance these deals. That's not what i'm concerned about my point is that if arm is a flop, it will be a huge negative impact on nvidia's balance sheet. I don't think this will happen, but, as an investor, you should consider all risks.

I wouldn't fixate on this too much because wall street is still bullish on nvidia, with one being very bearish and 5 being very bullish. The average analyst rating is 4.27 and out of 37 analyst ratings 29 are either very bullish or bullish. Granted two are bearish, but i doubt that these analysts understand how pivotal nvidia is to the world of technology at the time that i'm making this video nvidia is trading just below 520 and according to seeking alpha. The price target is 552, which means that there's a decent 30 upside here's another stock price prediction, so you can consider multiple options.

These 34 analysts over the next 12 months are predicting nvidia to hit 680 as a high target, which would be a 32 percent gain. Their median target is 562, which would be a 9 gain, and their low target is 300, which would be a 42 decline. I think that this low target is a little dated because there's not a snowball's chance in hell that nvidia goes back to 300.. In fact, on september 15, an analyst at needham increased their price target on nvidia to 700.

The analyst gill is increasingly upbeat on nvidia's prospects. After the company announced over the weekend that it will be acquiring arm from softbank strategically. We believe that the nvidia arm combination will create the leading ai computing platform in the semiconductor industry. The combination of three processors under one house positions nvidia to become the leading ai platform in the industry.

I know that analysts can be wrong, but it's tough to argue all the bullish sentiment surrounding nvidia. So now that we've covered the arm acquisition and some of nvidia's fundamentals, let's switch to a technical breakdown of their chart, nvidia trades under the ticker nvda and since the start of 2020, the stock is up a noteworthy 121 percent and since march it's been on this. Pretty picturesque run, which was a gain of 159 percent. My most recent purchase of nvidia came on this dip around 480.

If you're also bullish on nvidia, i wouldn't recommend arbitrarily buying shares. You should create a position as close to support as possible. As things currently stand. The first support would come at the low from september, which was at 468.

if the bears pushed the stock below this. The next support would be at this dip in august at 432, which was also resistance in august and as a reach target. You could always watch this low at 391.. I fully plan on being a long-term investor in nvidia, but if you're more of a swing trader with a shorter time frame, i would recommend taking some of your profits off the table at the all-time high of 588, which i'm expecting to act as resistance and as A final note for all of you, viewers with a shorter time frame nvidia, will be releasing its geforce rtx 30 series in september and october.

So, depending on how well this product is or isn't received by the market, i would be prepared for some volatility overall. I honestly already thought that nvidia was an excellent investment, and this potential acquisition of arm makes me even more bullish. I've personally been buying shares of nvidia over the past couple years and i plan on buying more and holding them for as long as possible. But with that being said, i'm not a financial advisor, and these are my own opinions.

So please do your own research thanks for watching to the end of the video. It means a lot to me. I would love to know your thoughts on nvidia. Are you buying, selling or holding feel free to? Let me know in a comment below also post any suggestions or recommendations for what you want me to cover next, if you found any value in this video.

Let me know by hitting the like button and if you want to be a member of the moon gang subscribe to the channel and don't forget to turn on your notifications, thanks for watching and until next time best of luck in the markets. You.