Tag: NVIDIA Corporation (NVDA)

AI Surge Fuels Nvidia & Broadcom Stocks: Buy Now or Wait for a Dip?

Posted on by The INO.com Team

Artificial intelligence (AI) has been a red-hot investment theme over the past two years, with its ability to learn and improve without much human input, making it valuable across nearly every industry. PwC predicts that AI could boost the global economy by $15.7 trillion by 2030.

With AI adoption on the rise, chip stocks like NVIDIA Corporation (NVDA) and Broadcom Inc. (AVGO) are well-positioned for long-term growth. But with these stocks hovering near their 52-week highs, is now the right time to buy, or should you wait for a potential dip? Let’s find out.

Stock to Buy: NVIDIA Corporation (NVDA)

Nvidia has been one of the most talked-about stocks this year, and for good reason. As one of the hottest large-cap stocks this year, the Wall Street darling is up nearly 14% in just the past week and more than 190% over the past year. It is trading just 5.6% below its 52-week high of $140.76. Much of this excitement is fueled by the company’s new Blackwell platform, which has both investors and customers eagerly watching its next moves.

Several analysts remain bullish on NVDA, and it’s easy to see why. KeyBanc recently raised its fiscal 2025 sales forecast to $130.60 billion, driven in part by Nvidia’s new AI chips, which are expected to contribute around $7 billion to fourth-quarter revenues.

Additionally, the company’s collaboration with Foxconn to build Taiwan’s largest supercomputer, along with a massive manufacturing facility in Mexico, underscores Nvidia’s commitment to scaling its operations while also minimizing supply chain risks.

In the second quarter that ended July 28, 2024, Nvidia’s revenue increased 122% year-over-year to $30.04 billion, and 15% from the first quarter. This robust growth exceeded analysts’ expectations, who had forecasted around $28.75 billion. Its AI-driven Data Center Group generated $26.30 billion in revenue, resulting in a 16% sequential gain and a triple-digit growth of 154% over the same period last year.

On the bottom line, its operating income surged 174% from the year-ago value to $18.64 billion. NVDA’s non-GAAP net income amounted to $16.95 billion or $0.68 per share, compared to $6.74 billion or $0.27 per share in the previous year’s quarter, respectively. The chipmaker is now gearing up for new AI hardware releases based on the Blackwell architecture, which could boost demand in the coming years.

Moreover, it forecasted a revenue of $32.50 billion, plus or minus 2%, for its fiscal third quarter, representing an 81.6% growth from the year-ago quarter. However, this slightly falls short of the analysts’ estimates of $32.90 billion. Nvidia’s business continues to thrive and will likely report another blowout quarter next month.

In addition to its strong financials, the company has approved a massive $50 billion share buyback program, which could boost investor returns over time. This, combined with surging demand for AI platforms and upcoming product launches, makes NVDA a stock worth considering for long-term investors looking to buy on any significant dip.

Stock to Hold: Broadcom Inc. (AVGO)

Thanks to the escalating demand for its AI products, Broadcom delivered a better-than-expected earnings report with double-digit top-line growth, comfortably surpassing Wall Street’s estimates. The demand for AVGO’s products, essential for building Data Centers, has soared due to the extensive adoption of AI-powered applications, particularly within the enterprise sector.

The semiconductor division, which makes up 56% of its total revenue, has been the company’s primary growth driver, while the remaining 44% falls into the industrial software segment. To keep pace with the surge in demand for AI technology, Broadcom is investing heavily in its product lineup, aiming to solidify its foothold in the booming AI chip market.

This frenzy for AI chips, driven by hefty investments in AI models, has significantly boosted the company’s topline growth. For the third quarter that ended on August 4, 2024, AVGO’s net revenue increased 47% year-over-year to $13.07 billion, with triple-digit revenue growth in the Infrastructure Software segment to $5.79 billion. Its revenues came in slightly above the analysts’ estimate of $12.96 billion.

AVGO’s gross margin grew 7.5% from the year-ago value to $8.36 billion, while its non-GAAP operating income came in at $7.95 billion, up 11.2% year-over-year. On top of it, the company’s non-GAAP net income came in at $6.12 billion or $1.24 per share, up 33.2% and 18.1% year-over-year, respectively. Also, its adjusted EBITDA increased 41.7% from the prior year’s quarter to $8.22 billion.

Looking ahead, management anticipates the revenue for the fourth quarter to be around $14 billion (in line with analysts’ consensus estimates) and adjusted EBITDA to be approximately 64% of revenue, translating to about $9 billion. For the full year, Broadcom projects revenue of $51.50 billion, up from its previous forecast of $51 billion.

Moreover, its robust free cash flow of $4.79 billion enabled it to pay a quarterly dividend of $0.53 per share on September 19, 2024. With 13 consecutive years of dividend growth, AVGO stands out among semiconductor-focused enterprises due to its consistent and significant cash flow distributions to shareholders.

The company pays an annual dividend of $2.12 per share, yielding 1.21% on the current share price, with a four-year dividend yield of 2.50%. Over the past three and five years, its dividend payouts have grown at CAGRs of 13.5% and 14.7%, respectively.

When it comes to price performance, shares of AVGO have soared over 110% over the past year and returned nearly 62% year-to-date. The stock is trading just 2.4% below its 52-week high of $185.16. With accelerating revenue, robust profit margins, and significant exposure to the AI chip industry, AVGO has garnered immense investor interest. However, the stock’s current valuation might burn a hole in one’s pocket.

In terms of forward non-GAAP P/E, AVGO is trading at 36.11x, 50.8% higher than the industry average of 23.94x. Its forward EV/EBITDA and Price/Cash Flow of 27.77x and 37.69x are 92.6% and 66.7% higher than the respective industry averages of 14.42x and 22.61x. Furthermore, the stock’s forward Price/Sales multiple of 15.85 compares with the industry average of 2.85.

Hence, given the lofty valuation levels, it may be prudent for investors to await a more opportune entry point into the stock.

How China’s Stimulus Could Affect Tech Stocks Globally

Posted on by The INO.com Team

After months of sluggish economic growth and fears of missing its growth targets, China has unveiled a sweeping set of stimulus measures aimed at reviving its economy. These policies included cuts to interest rates, loans to investors and companies for stock buybacks, and promises of substantial fiscal support. The People’s Bank of China’s (PBOC) coordinated efforts are aimed at reducing borrowing costs and boosting confidence in an economy struggling with issues like the ongoing property crisis and high youth unemployment.

Despite some analysts questioning the long-term sustainability of the stimulus, the market has responded with enthusiasm. Mainland China's CSI 300 Index surged 8.5%, marking its best performance since 2008, while Hong Kong's Hang Seng Index rose by 4.2%.

As these aggressive policies aim to jump-start the struggling economy, the impact could reach far beyond China's borders, with global tech stocks poised to benefit significantly. Companies like Apple Inc. (AAPL), NVIDIA Corporation (NVDA), Taiwan Semiconductor Manufacturing Company Limited (TSM), and QUALCOMM Incorporated (QCOM) rely on China not only for manufacturing but also as a major consumer market. With lower interest rates and improved liquidity in China, demand for tech products could surge, directly benefiting these tech giants.

Furthermore, the PBOC’s promise of potential fiscal stimulus adds another layer of optimism. If China follows through on its hints of trillion yuan-level spending, particularly in infrastructure and technology sectors, it could further boost global tech companies that provide critical components for these developments.

Many are drawing parallels to 2008 when China’s swift and massive stimulus response to the global financial crisis jump-started not only its economy but also helped boost global demand. However, that stimulus left China with long-term challenges, including local government debt, overcapacity, and excess housing.

While some investors remain cautious after past false starts, the current stimulus package has injected new optimism into the market. Tech stocks, in particular, offer an attractive opportunity as lower interest rates make them more appealing for investors seeking higher returns. Therefore, fundamentally sound stocks like AAPL, NVDA, TSM, and QCOM could be worth considering for those looking to tap into the potential upside driven by China’s recovery efforts.

Stock to Hold:

Apple Inc. (AAPL)

With China being one of Apple's largest markets for premium tech products, the country’s economic recovery could stimulate demand for iPhones, MacBooks, and other high-end devices. Lower interest rates and improved liquidity might encourage consumers to invest in Apple’s premium offerings, further driving the company's revenue in this region.

For the third quarter of fiscal 2024, which ended June 29, 2024, AAPL’s total net sales increased 4.9% year-over-year to $85.78 billion, with $14.73 billion in sales from Greater China. Its gross margin rose 8.9% from the year-ago value to $39.68 billion, while its operating income came in at $25.35 billion, up 10.2% year-over-year. On the bottom line, AAPL’s net income and EPS amounted to $21.45 billion and $1.40, representing increases of 7.9% and 11.1%, respectively, from the prior year’s quarter.

Street expects AAPL’s revenue for the current year (ended September 2024) to increase marginally from the prior year to $390.52 billion, while its EPS is expected to grow by 9.2% year-over-year to $6.69. For the fiscal year 2025, both revenue and EPS are anticipated to reach $419.84 billion and $7.41, indicating a 7.5% and 10.7% year-over-year growth, respectively.

Shares of the dominant tech player have surged more than 36% over the past year and approximately 21% year-to-date. Also, its 12-month price target of $248.07 reflects a 6.5% potential upside.

However, while the outlook is promising, investors should remain cautious of geopolitical tensions that could affect production and sales. Ongoing U.S.-China trade disputes may disrupt Apple’s supply chain, leading to increased costs or delays. As Apple relies heavily on Chinese manufacturing, any escalation in tensions could pose risks to its market performance.

Stocks to Buy:

NVIDIA Corporation (NVDA)

With the frenzy around Artificial intelligence (AI) in the stock market, the AI darling Nvidia has been on an impressive run this year. The stock has surged over 145% year-to-date and nearly 179% in the past 12 months, thanks to the robust demand for its graphics processing units (GPUs), which help run and train AI algorithms.

Nvidia’s revenue for the second quarter that ended July 28, 2024, increased 122% year-over-year to $30.04 billion and exceeded the analysts’ expectations of $28.75 billion. The company's bottom line also remained buoyant, with operating income surging 174% from the year-ago value to $18.64 billion. NVDA’s non-GAAP net income amounted to $16.95 billion or $0.68 per share, compared to $6.74 billion or $0.27 per share in the previous year’s quarter, respectively.

Moreover, analysts remain bullish on the chipmaker’s long-term prospects. For the fiscal year ending January 2025, NVDA’s revenue and EPS are expected to grow by 106.1% and 119.2% from the prior year to $125.54 billion and $2.84, respectively.

Furthermore, out of 42 analysts that rated NVDA, 39 rated it Buy, while three rated it Hold. The 12-month median price target of $152.44 indicates a 25.5% upside potential from the last closing price. As China accelerates its focus on artificial intelligence (AI) and high-performance computing, this stock could boost your portfolio returns significantly.

Taiwan Semiconductor Manufacturing Company Limited (TSM)

As China's tech sector surges, demand for semiconductors is set to soar, potentially contributing nearly 19% to the country’s GDP by 2026. Headquartered in Hsinchu City, Taiwan, TSM manufactures, tests, and markets integrated circuits and other semiconductor products globally. Its products are used in automotive electronics, high-performance computing, and mobile device markets.

TSM’s net sales increased 40.1% year-over-year to NT$673.51 billion ($21.25 billion) in the second quarter that ended June 30, 2024. Its gross profit grew 37.6% from the prior year’s quarter to NT$358.13 billion ($11.29 billion), while its income from operations came in at NT$286.56 billion ($9.04 billion), up 41.9% year-over-year. In addition, the company’s net income and EPS increased 36.3% year-over-year to NT$247.85 billion ($7.82 billion) and NT$9.56, respectively.

The consensus EPS estimate of $6.60 for the current year ending December 2024 represents a 27.4% improvement year-over-year. The consensus revenue estimate of $88.40 billion for the same period indicates a 29.1% increase from the prior year.

Moreover, the stock has gained more than 99% over the past year, which is impressive. Its 12-month price target of $205 reflects an 18.4% potential upside.

QUALCOMM Incorporated (QCOM)

QCOM specializes in foundational technologies for the wireless industry. The company operates through three segments: Qualcomm CDMA Technologies; Qualcomm Technology Licensing; and Qualcomm Strategic Initiatives.

QCOM’s revenue increased marginally year-over-year to $9.39 billion in the fiscal second quarter (ended March 24, 2024). Its non-GAAP net income grew 14.1% from the year-ago value to $2.76 billion, while its EBIT rose 31.8% year-over-year to $2.49 billion over the period. The company’s non-GAAP EPS increased 13.5% from the year-ago value to $2.44.

Buoyed by its strong financial performance, the company paid a quarterly dividend of $0.85 per common share to its shareholders on September 26, 2024. QCOM pays an annual dividend of $3.40, which translates to a 2% yield on the current price. Plus, it has a payout ratio of 34.1%.

Street expects QCOM’s revenue for the fourth quarter (ended September 2024) to increase 13.8% from the prior year to $9.86 billion. Its EPS for the same period is expected to grow by 26.1% year-over-year to $2.55. It is no surprise that the company has topped the revenue and EPS estimates in each of the trailing four quarters.

Over the past year, the stock has returned nearly 50%. Moreover, out of 21 analysts that rated QCOM, 13 rated it Buy, while seven rated it Hold. The 12-month median price target of $218.25 indicates a 31.3% upside potential from the last closing price.

Can NVDA’s Share Buybacks and AI Innovation Drive the Next Rally?

Posted on by The INO.com Team

NVIDIA Corporation (NVDA) has undoubtedly been one of the hottest large-cap stocks this year, surging over 150% year-to-date and more than 195% in the past 12 months. This stellar performance is driven by the massive demand for its graphics processing units (GPUs), which help run and train AI algorithms.

For the second quarter that ended July 28, 2024, Nvidia’s revenue increased 122% year-over-year to $30.04 billion and 15% from the first quarter. This robust growth exceeded analysts’ expectations, who had forecasted around $28.75 billion. NVDA’s Data Center Group (primarily connected to its AI operations) generated $26.30 billion in revenue, resulting in a 16% sequential gain and a triple-digit growth of 154% over the same period last year.

The company's bottom line remained buoyant, with operating income surging 174% from the year-ago value to $18.64 billion. NVDA’s non-GAAP net income amounted to $16.95 billion or $0.68 per share, compared to $6.74 billion or $0.27 per share in the previous year’s quarter, respectively. The chipmaker is now gearing up for new AI hardware releases based on the Blackwell architecture, which could boost demand in the coming years.

Moreover, it forecasted a revenue of $32.50 billion, plus or minus 2%, for its fiscal third quarter, representing an 81.6% growth from the year-ago quarter. However, this slightly falls short of the analysts’ estimates of $32.91 billion.

Is NVDA’s Buyback a Boost for Earnings or a Sign of Investor Fatigue?

In addition to its strong financials, NVIDIA's board has approved a massive $50 billion share buyback program. This adds to the $7.5 billion remaining from its previous buyback plan. Share repurchases typically boost earnings per share by reducing the number of outstanding shares, making the stock more attractive to investors.

The company has already returned $15.4 billion to shareholders through repurchases and dividends during the first half of fiscal 2025. However, despite the strong financial performance and the buyback announcement, NVDA’s stock dropped around 10% after its earnings report. It seems investors had such high expectations that even strong results weren’t enough to impress them.

“Investors want more, more and more when it comes to Nvidia,” said Dan Coatsworth, investment analyst at AJ Bell. “It looks like investors might not have taken the average of analyst forecasts to be the benchmark for Nvidia's performance, instead, they've taken the highest end of the estimate range to be the hurdle to clear.”

On the brighter side, the company’s upcoming AI-focused chips, particularly the Blackwell architecture, are poised to meet rising demand and could reignite investor confidence. While its production has been slightly delayed, the company plans to ramp up shipments in the fourth quarter, with strong demand already building up.

Alongside Blackwell, Nvidia’s Hopper platform continues to see robust demand, and shipments of its upgraded H200 platform are targeting cloud service providers and large enterprises, with more demand expected in the second half of 2024. Thus, Nvidia still has plenty of fuel left to drive another rally.

Bottom Line

Thanks to the surging demand for its AI platforms, upcoming product launches, and a broadening market, we believe that Nvidia is well-positioned for continued expansion. The recent dip in its share price could simply be a brief pause before the next phase of growth unfolds.

Moreover, analysts remain bullish on the chipmaker’s long-term prospects. Out of 42 analysts that rated NVDA, 39 rated it Buy, while three rated it Hold. The 12-month median price target of $152.44 indicates a 22.9% upside potential from the last closing price. The price targets range from a low of $90 to a high of $200.

Therefore, investors looking for long-term opportunities could consider scooping up the shares of this tech giant before the stock regains momentum.

Taiwan Semiconductor's 10% Dip: Is It Time to Buy?

Posted on by The INO.com Team

With a $897.58 billion market cap, Taiwan Semiconductor Manufacturing Company Limited (TSM) plays a crucial role in the global semiconductor ecosystem by leading in the production of advanced chips used across several industries, including consumer electronics, automotive, telecom, and artificial intelligence (AI).

As one of the world’s largest independent semiconductor foundries, TSM’s expertise in advanced process technologies, such as 3nm and 5nm nodes, has made it a critical supplier for major tech companies, such as NVIDIA Corporation (NVDA), Advanced Micro Devices, Inc. (AMD), and Apple Inc. (AAPL).

Recently, the stock has dipped by around 10% from its all-time highs, making many investors wonder whether this pullback offers a prime buying opportunity. Let's assess whether long-term investors should capitalize on TSMC’s discounted price.

TSMC’s Technological Leadership

Taiwan-based TSMC’s role in advancing manufacturing chip technology has solidified its position as a critical player in the high-tech ecosystem, particularly in industries such as AI, 5G, automotive, and data centers. One of the company’s greatest strengths is its leadership in advanced node technology.

As a global chip leader, TSM provides the most advanced and comprehensive portfolio of dedicated foundry process technologies, including A16, 2nm, 3nm, 5nm, 7nm, and more. The company’s 3nm process is the industry’s leading semiconductor technology, providing the best power, performance, and area (PPA) and represents a full node advance from the 5nm generation.

TSMC continuously expands its 3nm technology portfolio to cater to diverse customer needs. Last year, the chip giant added new members to its industry-leading 3nm technology family, including the N3X process, designed specifically for high-performance computing (HPC) applications, and N3AE, facilitating an early start for automotive applications on the most advanced silicon technology.

Moreover, TSMC’s 2nm technology employing nanosheet transistors continues to make significant progress in terms of yield and device performance and is expected to commence production in 2025.

Earlier this year, at its 2024 North America Technology Symposium, TSMC introduced its latest semiconductor process, advanced packaging, and 3D IC technologies, showcasing its silicon leadership in driving the next generation of AI innovations.

With TSMC's cutting-edge N3E technology now in production and N2 slated for production in the second half of 2025, the company unveiled A16, the next technology in its roadmap. A16, set for production in 2026, integrates TSMC’s Super Power Rail architecture with nanosheet transistors. It enhances logic density and performance by allocating front-side routing resources to signals, making it well-suited for HPC products.

Also, the chip company introduced its System-on-Wafer (TSMC-SoW™) technology, a groundbreaking solution designed to deliver exceptional performance to the wafer level in addressing the future AI needs of hyperscaler data centers.

TSMC Surpasses Second-Quarter Earnings Expectations Amid AI Chip Boom

TSMC’s revenue and earnings beat analyst expectations in the second quarter of 2024 as demand for advanced chips used in AI applications continues to surge. In the quarter that ended June 30, 2024, the company’s net revenue rose 40.1% year-over-year to $20.82 billion. That surpassed analysts’ revenue estimate of $20.09 billion.

CEO C.C. Wei, in an earnings call, said business during the quarter was supported by robust demand for its industry-leading 3nm and 5nm technologies. TSMC’s shipments of 3-nanometer accounted for 15% of total wafer revenue, 5-nanometer constituted 35%, and 7-nanometer made up 17%. Advanced technologies, defined as 7-nanometer and more advanced technologies, accounted for 67% of total wafer revenue.

TSMC’s non-GAAP income from operations rose 41.9% year-over-year to $8.86 billion. Its net income and earnings per ADR were $7.66 billion and $1.48, increases of 36.3% year-over-year, respectively. Its earnings per ADR compared to the consensus estimate of $1.42.

“Moving into third quarter 2024, we expect our business to be supported by strong smartphone and AI-related demand for our leading-edge process technologies,” said Wendell Huang, Chief Financial Officer of TSMC.

Based on the company’s current business outlook, TSMC’s management expects revenue between $22.40 billion and $23.20 billion for the third quarter of 2024. The company’s gross profit margin is projected to be between 53.5% and 55.5%, and its operating profit margin is anticipated to be between 42.5% and 44.5%.

Why TSMC's Stock Dip May Be a Buying Opportunity

TSMC's leadership in advanced chip manufacturing, coupled with the growing demand for advanced chips across AI, 5G, and high-performance computing sectors, positions the company for long-term growth. Management has projected third-quarter revenue to be $22.40-$23.20 billion, compared to $17.30 billion reported in the previous year’s quarter.

Meanwhile, analysts appear highly bullish about the company’s earnings growth. Street expects TSMC’s revenue and EPS for the current quarter (ending September 2024) to grow 38.8% and 37.9% year-over-year to $23.44 billion and $1.78, respectively.

For long-term investors, TSMC's recent 10% decline may present an opportunity to buy into a company at the forefront of technological innovation. While short-term market fluctuations and geopolitical concerns may persist, the company's technological leadership and strong growth outlook make it a compelling choice for those looking to benefit from the continued evolution of AI and semiconductor technology.

Bottom Line

TSMC's recent stock dip presents a potential buying opportunity for long-term investors seeking exposure to a global leader in semiconductor innovation. With its industry-leading 3nm and 5nm process technologies, TSMC is well-positioned to capitalize on the growing demand for advanced chips, particularly in AI, 5G, and high-performance computing (HPC) industries.

While geopolitical risks and market volatility may pose challenges in the near term, TSMC’s strong earnings outlook and continuous innovation in semiconductor manufacturing suggest that this dip could be a strategic entry point.

Does NVDA’s Stock-Split Powerhouse Have More Upside?

Posted on by The INO.com Team

In recent years, stock splits have returned, shaking off their previous decline in popularity. This process involves a company issuing additional shares to existing shareholders, which lowers the price per share without altering the company's overall market value. For example, in a 2-for-1 stock split, you’d end up with twice the number of shares, each priced at half the original value, but the total value of your investment remains unchanged.

Companies that execute stock splits often see positive effects on their stock price. Historically, stocks that split tend to gain an average of 25% in the year following the split, compared to a 12% increase for the S&P 500, according to Bank of America. This can make stock splits an appealing strategy for companies looking to boost their stock’s accessibility and attract more investors.

NVIDIA Corporation (NVDA), known for its powerful graphics processing units (GPUs) for data centers, cloud computing, and artificial intelligence (AI), is a prime example of this trend. The company recently executed its high-profile 10-for-1 stock split in June. Despite a stellar earnings report, NVDA’s stock faced a dip recently, reflecting the high expectations and potential risks associated with being “priced for perfection.” This scenario often leaves little room for error, making even minor setbacks potentially impactful.

With that in mind, let's explore how NVDA’s stock-split strategy and robust market position might influence its future upside potential.

Chipmaker’s Stellar Earnings Fuel Bullish Analyst Confidence

For the second quarter that ended July 28, 2024, Nvidia’s revenue increased 122% year-over-year to $30.04 billion, and 15% from the first quarter. This robust growth exceeded analysts’ expectations, forecasting around $28.75 billion. NVDA’s Data Center Group (primarily connected to its AI operations) generated $26.30 billion in revenue, resulting in a 16% sequential gain and a triple-digit growth of 154% over the same period last year.

The financial metrics were equally impressive. The company’s gross profit improved by 138.6% year-over-year to $22.57 billion, while its operating income surged 174% from the year-ago value to $18.64 billion. NVDA’s non-GAAP net income amounted to $16.95 billion or $0.68 per share, compared to $6.74 billion or $0.27 per share in the previous year’s quarter, respectively. Additionally, the company’s cash reserves stood at $34.80 billion, up 33.9% from $25.98 billion on January 28, 2024, with free cash flow nearly doubling to $13.48 billion.

Clearly, the chipmaker’s earnings report was robust, earning high praise from Wedbush’s Dan Ives, who described it as a “mic drop moment” for CEO Jensen Huang, and it’s easy to see why. According to Ives, the results underscore that the “AI revolution” is firmly entrenched. While some analysts had forecasted revenue a bit too optimistically, Nvidia still delivered robust results.

The demand for Nvidia’s AI-critical chips is as strong as ever, and any worries about delays with the company’s new Blackwell chips have been put to rest. In fact, Nvidia is forecasting “several billion dollars” in Blackwell revenue for the fiscal fourth quarter, signaling continued strong performance. Ives said, “Nvidia has changed the tech and global landscape as its GPUs have become the new oil and gold.”

However, NVDA’s stock did take a hit recently, leading some to question if expectations for tech stocks have become too inflated due to the AI hype. Thomas Matthews from Capital Economics believes that despite the short-term drop, the AI rally still has room to grow. His confidence is shared by many on Wall Street, who view the dip as a buying opportunity rather than a cause for concern.

Bank of America Global Research, led by Vivek Arya, has raised its price target for Nvidia from $150 to $165, emphasizing that the company’s growth potential remains significant and investors should “ignore quarterly noise.”

Similarly, UBS analyst Timothy Arcuri maintains a buy rating and a $150 price target, reflecting ongoing confidence in Nvidia’s future. Gabelli Funds’ Belton also highlighted how the chipmaker effectively addressed two major concerns: delays with the Blackwell chip and potential overspending by key customers. The company’s guidance for the upcoming quarter and its proactive handling of these issues are seen as clear signs of confidence.

Overall, the analysts’ consensus is clear: NVDA’s stock still has significant upside potential despite short-term fluctuations. Their strong earnings performance and strategic positioning in the AI market make it a compelling investment for those looking to capitalize on the tech giant’s continued growth.