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Subscribe →Today, we received the consumer confidence report from the Conference Board, which showed that one-year inflation expectations rose to 6% from 5.2% in January. This follows the University of Michigan report, which jumped to 4.3% from 3.3%. I don’t know what next month’s data will show, but it seems clear that inflation is doing anything but moderating. One could certainly argue that inflation expectations are no longer well-anchored.
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But let’s forget about inflation for now because more pressing matters are at hand—namely, the most important stock in the world, Nvidia, and its earnings report tomorrow. I’m just waiting for that $2 billion revenue beat, followed by next quarter’s guidance exceeding it by another $2 billion—totaling $4 billion more than last quarter’s guidance for the current quarter. After all, they’ve done this for six consecutive quarters, so why not make it seven? It wouldn’t be surprising if the company reports revenue exceeding $40 billion and provides guidance above $42.5 billion.
Right now, the stock is expected to move only 9% post-earnings—so what’s that, a $300 billion market cap swing in either direction? What could go wrong? The at-the-money options expiring on Friday have an implied volatility of about 147%, and that will likely be even higher by tomorrow afternoon.
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Right now, the $127 call options for Friday are trading at $6.60, meaning the stock needs to rise to $133.60—about 5%—just for the buyer to break even. Meanwhile, the $127 puts for Friday are trading at $6.90, requiring Nvidia to drop to $120.10, or 5.4%, to break even. I’m guessing there will be plenty of unhappy put and call holders come Thursday morning.
Anyway, I could go on, but right now, I'm tired.
-Mike
This report contains independent commentary to be used for informational and educational purposes only. Michael Kramer is a member and investment adviser representative with Mott Capital Management. Mr. Kramer is not affiliated with this company and does not serve on the board of any related company that issued this stock. All opinions and analyses presented by Michael Kramer in this analysis or market report are solely Michael Kramer’s views. Readers should not treat any opinion, viewpoint, or prediction expressed by Michael Kramer as a specific solicitation or recommendation to buy or sell a particular security or follow a particular strategy. Michael Kramer’s analyses are based upon information and independent research that he considers reliable, but neither Michael Kramer nor Mott Capital Management guarantees its completeness or accuracy, and it should not be relied upon as such. Michael Kramer is not under any obligation to update or correct any information presented in his analyses. Mr. Kramer’s statements, guidance, and opinions are subject to change without notice. Past performance is not indicative of future results. Neither Michael Kramer nor Mott Capital Management guarantees any specific outcome or profit. You should be aware of the real risk of loss in following any strategy or investment commentary presented in this analysis. Strategies or investments discussed may fluctuate in price or value. Investments or strategies mentioned in this analysis may not be suitable for you. This material does not consider your particular investment objectives, financial situation, or needs and is not intended as a recommendation appropriate for you. You must make an independent decision regarding investments or strategies in this analysis. Upon request, the advisor will provide a list of all recommendations made during the past twelve months. Before acting on information in this analysis, you should consider whether it is suitable for your circumstances and strongly consider seeking advice from your own financial or investment adviser to determine the suitability of any investment.
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Mott Capital's Market Chronicles May 8, 2026 10:02 AM