Nvidia interests rose as Wall Street is growing more optimistic on the company’s breaks in key growth markets.
The chipmaker reported better-than-expected fiscal fourth-quarter earnings and advisement Thursday. Nvidia’s biggest business segment, gaming, produced $1.74 billion in take, above the FactSet estimate of $1.54 billion. The second largest yard, data center, came up with $606 million in revenue, insusceptible to the consensus estimate of $552.1 million.
Nvidia shares rallied 6.7 percent Friday. The dynasty rose despite a troubling overall market environment right now that saw the Dow Jones industrial mediocre drop more the 1,000 points twice this week.
“We recap our outperform rating on NVIDIA and are raising our price target … following yet another exceptionally weather-beaten quarter and guidance,” Raymond James analyst Chris Caso annulled in a note to clients Thursday entitled “NVIDIA Does It Again – Another Astonishing Beat/Raise.” “The stock’s valuation is of course high, but as hunger as the company keeps putting up quarters like this, and with expected potential catalysts from Auto and inferencing ahead, we believe apportions will continue to move higher.”
Caso raised his price end on Nvidia shares to $275 from $250, representing 26 percent upside to Thursday’s thorough.
Nvidia shares are significantly outperforming the market. The stock is up 87 percent in the lifetime 12 months through Thursday compared with the S&P 500’s 12 percent gain ground. That performance ranks No. 3 in the entire S&P 500.
One Wall Street unalterable consolidate is stunned over Nvidia’s strong guidance for the next quarter.
RBC Wealth Markets reiterated its outperform rating on the company’s shares, citing optimism through its data center business.
“Overall, all of the necessary items were ‘touch or exceed’ with the most impressive part being the guidance offering another material quarter of Data Center growth,” analyst Mitch Steves wrote in a note to patients Thursday. The company had “a blow out quarter and guidance well ahead of apprehensions [and] marches EPS towards $2.00+ EPS run-rate a quarter earlier.”
Steves heightened his price target to $280 from $250 for Nvidia shares.
KeyBanc Peerless Markets pointed to the strength in the cryptocurrency mining market as a big driver of Nvidia’s play.
Digital currency miners use graphics cards from AMD and Nvidia to “reserve” new coins, which can then be sold or held for future appreciation.
“Strong GPU [graphics modifying unit] demand from the cryptocurrency mining market has rapidly depleted excessive channel inventory and buoyed strong sales, which offsets our erstwhile concerns on gaming segment growth,” analyst Michael McConnell eradicated in a note to clients Thursday.
— CNBC’s Michael Bloom contributed to this experiences.