Should You Buy Nvidia Before May 20? History Offers a Strikingly Clear Answer.

Nvidia (NASDAQ: NVDA) stock has offered many investors a clear path to explosive gains in recent years. As leader in the artificial intelligence (AI) chip market, the company has been among the first to benefit from AI-driven earnings growth -- and this has prompted investors to pile into the stock.

Though others also sell AI chips, Nvidia was first to market with the most powerful product -- and Nvidia's focus on innovation has helped it remain in the lead. All of this has translated into record levels of revenue quarter after quarter -- and at high levels of profitability.

The question hasn't been whether to buy Nvidia stock, but when to get in on this player. For example, some investors have purchased shares before a major conference, with the idea that new details about upcoming product launches may push the stock higher. So, today, with a potential catalyst just ahead -- on May 20 -- you might be wondering whether you should rush to get in on the stock beforehand. History offers a strikingly clear answer.

Image source: Getty Images.

Supercharging large language models

Let's start by catching up on Nvidia's story so far. As mentioned, the company is the dominant AI chip designer worldwide, offering graphics processing units (GPUs) that supercharge key tasks like the training and inference of large language models. Nvidia serves the world's biggest tech companies -- from Microsoft to Meta Platforms -- as well as customers of cloud service providers.

All of this has helped revenue and net profit to soar in recent years. In the latest full year, revenue climbed 65% to $215 billion. Nvidia prides itself on regular innovation, with a promise to update its chips annually, and the next update is just ahead. The company is on track to make its Vera Rubin system available later this year. This has helped Nvidia stay ahead of rivals and keep revenue charging higher.

It's also important to note that Nvidia isn't just a chip company. It makes complete systems and even offers enterprise software and platforms specific to various industries such as healthcare and automotive. Nvidia also has expanded the reach of its AI systems across industries -- for example, announcing an AI platform for 6G in telecom last year and more recently releasing an AI model family to advance quantum computing.

All of this is keeping Nvidia at the forefront -- and making it very difficult for customers to bypass the company on their AI paths.

So, while other chip designers may also be successful as the AI story unfolds, there's reason to be optimistic about Nvidia maintaining the lead and making a great long-term investment.

When should you buy Nvidia stock?

But when should you buy the stock? Before May 20 might seem like a good time since on that day, Nvidia will deliver its fiscal 2027 first-quarter earnings report. Should you really rush to get in on the stock before that time, though?

History shows us something interesting. While Nvidia has a fantastic track record over the long term, it doesn't necessarily soar after every earnings report -- even though the reports have been strong in recent years.

Considering the past 12 quarterly reports, Nvidia stock has gained five times in the five trading days following those reports. And in the past four quarters, it's only advanced one time -- that was after the first-quarter report last year.

Here's a closer look:

The stock has advanced after every first-quarter report over this time frame, suggesting that this may be a favorable time of year for the company. It's important to remember that this often precedes the release of a new product, for example, Blackwell Ultra last year, and this year the Rubin platform. So investors may be feeling optimistic about these updates.

But, overall, history is compellingly clear: Nvidia's post-earnings gains haven't been a sure thing.

What this means is you don't have to rush into the stock before a specific date in order to benefit from the Nvidia story. Instead, you may take your time and scoop up the stock now or later -- in both cases, it could be a winning long-term move thanks to the company's strength in the booming AI market.

Adria Cimino has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Meta Platforms, Microsoft, and Nvidia. The Motley Fool has a disclosure policy.