Key Takeaways
- After Nvidia reported third-quarter results that blew past estimates, several analysts raised their price targets for the chipmaker’s stock.
- Nvidia’s data center revenue reached a quarterly record on strong demand for its AI chips, and the company said it expects to ship more of its Blackwell AI chips than previously expected.
- Nvidia’s chips could also drive greater spending across the tech sector, Wedbush analysts said.
After Nvidia (NVDA) reported record quarterly revenue driven by gains in its data center sales and raised expectations for its Blackwell artificial intelligence (AI) chips, several analysts boosted their price targets for the chipmaker’s stock.
Wedbush analysts lifted their price target to $175 from $160, implying about 19% upside from Thursday’s closing price, pointing to strong demand for Nvidia’s AI chips and signs production of its next-generation Blackwell chip is “ramping at least as fast as expected.”
On the company’s earnings call, CEO Jensen Huang said Nvidia is on track to ship more Blackwell chips than previously anticipated in the current quarter, which runs through January. Analysts at Mizuho raised their price target to $175 from $165 after the call, projecting up to $5 billion in Blackwell revenue in the period.
Citi analysts bumped their price objective to $175 from $170, and Goldman Sachs hiked its target to $165 from $150, anticipating gains from “growing demand for AI infrastructure across all customer groups.”
Nvidia also appeared to dismiss worries surrounding reported Blackwell issues with overheating, which “should alleviate any lingering investor concerns around Blackwell execution,” Wedbush analysts wrote.
Shares of Nvidia wavered between gains and losses in Thursday’s session, and briefly climbed to an intraday record before closing 0.5% higher at $146.67. The stock has nearly tripled in value since the start of the year.
Nvidia GPUs Could Drive Higher Spending Across Tech Sector, Wedbush Says
Wedbush analysts also suggested Nvidia could be poised to lead a tech rally into year-end and 2025 after its strong results, with a ripple effect from spending on its chips that could boost the broader tech industry. The analysts estimated that every $1 spent on an Nvidia GPU could have an $8 to $10 multiplier effect across the tech sector.
UPDATE—Nov. 21, 2024: This article has been updated to include additional analyst comments and reflect more recent share price values.
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