Nvidia (NASDAQ:NVDA) erases pre-market profits; 3.5% drop Despite unusually high expectations in the press, Wall Street was impressed with the semiconductor giant’s third-quarter results and outlook, which were released Wednesday.
Bank of America analyst Vivek Arya said: He said Jensen Huang’s company is still in the first 25% of the transformation of the roughly $250 billion global computing infrastructure to accelerated, artificial intelligence-centric computing. I think there are. He now believes the company could earn up to $40 per share in 2027, up from $32 per share before the earnings release.
Aria raised his price target from $650 to $700 following the results, but acknowledged that the stock price “could be volatile in the short term” after the stock has risen 240% since the beginning of the year. .
“CY24E PE valuation is only 24x (and 10x) [long-term] EPS output) looks significantly lower compared to 30-35% of sales in CY23-27E. [earnings per share compound annual growth rate] with best-in-class EBITDA of over 65% and FCF margin of over 40%,” Arya wrote.
On the downside, Aria said that while issues arising from expanded export restrictions to China were a “risk”, demand was likely to outstrip supply well into next year.
Looking ahead, Nvidia (NVDA) expects fourth-quarter revenue to be $20 billion, plus or minus 2%, beating analyst estimates of $17.9 billion.
The company expects sales in China to decline “significantly” due to the Biden administration’s recent export restraint regulations. Nvidia added that this decline will be offset by growth in other regions.
Citi analyst Atif Malik, like Bank of America’s Aria, expects the stock to be “in range” in the first half of fiscal 2024 as year-on-year comparisons become tougher, especially for data centers. He said there is.
Malik said the Consumer Electronics Show in January, where the company plans to hold a “special talk,” and the company’s GTC conference in March will be the “next big thing.” He maintained his buy rating and set a price target of $575.
Rosenblatt analyst Hans Mosesmann reiterated his Buy rating and $1,100 price target on Nvidia (NVDA), calling the results and guidance “epic.”
Mosesman said Grace Hopper’s superchip is already positioned as next year’s “multi-billion dollar business,” with networking on track for $10 billion in sales and software and services on its own. It said it was at a run rate of $1 billion.
Wedbush Securities analyst Matt Bryson said Nvidia’s results showed a “positive outlook” for Super Micro Computers (SMCI) and Taiwan Semiconductor (TSM).
Bryson added that he believes Nvidia (NVDA) can achieve similar results for at least another quarter or two as demand continues to outstrip supply.