Nvidia Stock and Las Vegas Sands: A Comparison of Growth
Nvidia Stock vs Las Vegas Sands
Nvidia stock is a sensation with investors — including top fund managers — for its off-the-hook growth. But there’s one S&P 500 stock that’s seen growing even faster than the AI wunderkind. X Analysts think casino operator Las Vegas Sands (LVS) will post 150.7% revenue growth in 2023. That’s the highest expected top line growth predicted for this year from all S&P 500 companies, says an Investor’s Business Daily analysis of data from S&P Global Market Intelligence and MarketSmith. It’s even higher than the breathtaking 100.5% top-line growth analysts see coming from Nvidia (NVDA) this calendar year. Amazingly, though, shares of Las Vegas Sands are up just 1.1% this year. Nvidia stock is up 211.6%. It’s just a reminder of how investors still assume there’s a better future from tech stocks like Nvidia than other sectors, says Nicholas Colas of DataTrek Research. “There’s a wide range of earnings revisions for tech names across these periods, but overall most of these companies present a brighter outlook than the broader U.S. equity market,” he said.
Why Growth Is Gold
Finding huge growth from companies like Las Vegas Sands and Nvidia is getting harder as many S&P 500 companies’ revenue slow down this year. S&P 500 companies in total are seen putting up just 2.4% revenue growth this year, says John Butters of FactSet. Not surprisingly, many companies are trying to distract investors with their lack of growth with promising stories. A record 177 companies mentioned “AI” during the conference calls with investors since June 15. That’s triple the average number of companies talking about AI over the past five years, Butters says. Investors are playing along for now. Shares of the companies dropping “AI” into their calls are up 13.3% this year, topping the 1.5% rise of companies not mentioning AI. But eventually, investors will want to see the letters, AI, turn into higher numbers in the income statement.
Betting On Las Vegas Sands
Las Vegas Sands is perhaps the best example of corporate growth kicking in as the economy reverts to pre-pandemic life. It owns and runs casinos primarily in Asia. Analysts think the company will put up $10.3 billion in 2023 revenue. If that materializes, it would be 151% higher than the revenue in it posted in 2022. That outstrips Nvidia’s expected 100.5% growth in 2023. What’s more, though, is that Las Vegas Sands average annual growth rate in the next two years is seen hitting 85.2%. That, too, tops Nvidia where growth on the same basis is forecast at 71.3%. Investors, though, seem unimpressed. Shares sport a relative strength of just 53, meaning its stock is lagging 47% of all others. But again, the rise of travel is a big S&P 500 theme of growth. Half of the S&P 500 companies expected to grow the most this calendar year are in a similar boat, like Carnival (CCL), Norwegian Cruise Line (NCLH), Wynn Resorts (WYNN) and Royal Caribbean (RCL).
Where Has Tech Growth Gone?
Investors may love tech. But the big growth just isn’t there, with the exception of Nvidia. Nvidia is one of just two information technology stocks seen being in the fastest-growing 10 stocks in the S&P 500 this year. But the other fast-growing tech isn’t part of the Magnificent Seven, but instead solar installation firm First Solar (FSLR). Analysts think the company’s top-line this calendar year will hit $3.5 billion, up nearly 34% from last year. What about the tech giants? Apple (AAPL) might be the most valuable S&P 500 stock, but it’s not due to big growth. Analysts think the gadget maker will only grow its top line by 0.6% in calendar 2023 followed by 7.4% growth in calendar 2024. With that said, consumer discretionary Tesla is holding its own. And it is a Magnificent Seven stock. Analysts think the EV maker’s top line will hit $129.0 billion this year, up 22.8% from last year. That’s pretty good, but still not enough to impress Las Vegas Sands investors.
Biggest S&P 500 Revenue Growth
|Company||Ticker||2-year avg. rev. growth (est.)||Stock YTD % ch.||Sector|
|Las Vegas Sands (LVS)||85.2%||1.1%||Consumer Discretionary|
|Nvidia (NVDA)||71.3||211.6%||Information Technology|
|Carnival (CCL)||43.4||89.3%||Consumer Discretionary|
|Norwegian Cruise Line (NCLH)||42.7||33.9%||Consumer Discretionary|
|Wynn Resorts (WYNN)||39.6||14.8%||Consumer Discretionary|
|Extra Space Storage (EXR)||36.7||-13.9%||Real Estate|
|Royal Caribbean Cruises (RCL)||34.2||95.4%||Consumer Discretionary|
|First Solar (FSLR)||32.1||21.8%||Information Technology|
|Tesla (TSLA)||25.9||101.5%||Consumer Discretionary|
|Prologis (PLD)||25.7||8.3%||Real Estate|
Source: S&P Global Market Intelligence, IBD.
Follow Matt Krantz on Twitter (X) @mattkrantz
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