Good morning. U.S. chip maker Nvidia Corp. reported results this week, an event that was more anticipated than most dry earnings calls. Currently the world’s most valuable company at US$3.6 trillion, Nvidia contributed about a quarter of the S&P 500’s gain for the year and makes up seven per cent of the S&P 500 index.

This makes the company’s quarterly earnings a big event for U.S. equity investors. Nvidia has seen soaring demand for its semiconductors, which are used to power artificial intelligence applications. The company posted revenue of US$35.08 billion, up 94 per cent from US$18.12 billion a year ago, and said it earned US$19.31 billion in the quarter, more than double the US$9.24 billion it posted in last year’s third quarter. Shares in Nvidia are up 195 per cent so far this year.

The question is whether a valuation of 34 times forward earnings, as calculated by London Stock Exchange Group, is justified. Some investors had been expecting more, causing shares to slide down slightly after the results were out. Investors will be watching to see if demand for the company’s next-generation AI chip, called Blackwell, can help it maintain its pace as rivals rush to produce competitor products.

Christina Varga, Financial Post’s Wealth and Investing editor. If you have any tips, quips or queries, get in touch at cvarga@postmedia.com.

Tempted by this hot market? Don’t succumb to the sin of pride

Pride is destructive when it comes to investing, as it motivates us to take risks when we really shouldn’t, cautions portfolio manager Martin Pelletier. But years of great returns from volatile investments can still erode your portfolio through the damage of down years.

DOWNSIDE PROTECTION

Same old story, same old song: the dangers of a high-valuation market

When stock and bond valuations have been above long-term averages, returns over the next several years have been painful, warns portfolio manager Noah Solomon. And right now, U.S. stocks lie at over a 50 per cent premium to their long-run average. 

TOO HOT TO HANDLE? 

Between investments? Why investors choose cash management funds to park their cash. In an unsettled market, it’s not unusual for investors to convert investments into cash while they find themselves between long-term investments. Cash management funds represent a sweet spot for liquidity and returns, says Ninepoint Partners’ Etienne Bordeleau-Labrecque

Mixed news for Metro investors. Metro Inc., the company behind Metro grocery stores and Jean Coutu drugstores, reported earnings of $219.9 million, slightly down from $222.2 million in the fourth quarter last year. But with a year of supply chain transformation behind it, and having opened nine new grocery stores and with plans to open 12 new discount stores, the company expects to gradually resume its profit growth in fiscal 2025. 

Mixed news for Canadian energy investors. One view is that incoming U.S. President Donald Trump’s new energy council could mean opportunity for Canada. Another is that under its “Make America Great Again” mantra, if the U.S. ramps up energy production, it could lower the price of Canadian oil. 

Bad news for potato purchasers. Two Canadian frozen-potato giants have been named in separate price-fixing lawsuits south of the border. McCain Foods Ltd. and Cavendish Farms are among those accused of being part of a “potato cartel,” allegedly conspiring with other large processors by sharing pricing data in an effort to raise the price of frozen potatoes in the United States. The allegations have not been tested in court and the class actions have yet to be certified. 

Good news for Musk and brain chip fans: Elon Musk's Neuralink brain chips have been cleared for clinical trials in Canada. While overshadowed by the billionaire’s other companies, such as Tesla and SpaceX, Neuralink aims to be a game changer in treating conditions such as spinal cord injuries. Hopefully, the company overcame its initial problems in its first human trial.

Should I get back into the market at age 71 after I got scared and pulled out?

A B.C. couple living on disability and government pensions wonders if they should up their risk. One question certified financial planner Allan Norman has for the couple: Ask yourself if you really need to get back in at all?

GET THE ANSWER

If you have an investing or personal finance question, hit us up at cvarga@postmedia.com.

The new 2025 CRA numbers: tax brackets, CPP, RRSP and TFSA limits, and more

Tax expert Jamie Golombek surveys what’s changing come January: From how much more you could owe, to how your OAS and CPP may change, the inflation adjustment factor, basic personal amount, and other tax changes to be aware of.

NEW YEAR, NEW NUMBERS

This B.C. couple wants to carry a monster mortgage into retirement

Leo and Siobahn now pay almost $13,000 a month in expenses and a third goes to debt. Still, there is a way this couple can have the cash flow for them to enjoy the retirement they envision, says retirement planner Eliott Einarson. 

DEBT TRAP

How often should you update your financial plan?

A comprehensive financial plan should incorporate six key areas, but what a financial plan looks like and how often you should update yours is a mystery to many Canadians. Certified financial planner Jason Heath goes into detail, cautioning: A plan is never final. 

GETTING ORGANIZED

Canada's tax system needs a Big Bang and soon

Compared to other OECD countries, Canada relies more on personal taxation revenues, writes tax expert Kim Moody. We need to have broad-based personal tax reductions, especially in light of the recent outcome in the U.S. election.