Nvidia’s Stock: A Trend Analysis Amid Earnings Jitters
As Nvidia prepares to unveil its latest earnings report this Wednesday, the chatter on Wall Street is hard to ignore. Despite the mixed feelings surrounding potential revenue performance, savvy analysts see opportunity written all over Nvidia Corp.’s (NVDA) stock. Analysts from key institutions such as Evercore ISI Securities, Piper Sandler, and Truist Securities have all reiterated strong buy-equivalent ratings, hinting that Nvidia remains an attractive play even amidst these earnings jitters.
Transition and Demand: The Heart of Nvidia’s Narrative
Nvidia is currently in a transformative surge as it shifts toward its new Blackwell platform. While it’s transitioning, the demand for its previous chip lineup, particularly the Grace/Hopper family, remains robust. Piper Sandler analyst Harsh Kumar is bullish on Nvidia’s prospects, projecting a revenue beat of about $1.8 billion this quarter. He confidently stated, “We continue to believe Nvidia is sold out for calendar year 2025, indicating a certain level of bullish sentiment.” His price target stands at $175.
In contrast, Evercore ISI’s Mark Lipacis has noticed a slight delay in the full production ramp-up of Blackwell, now expected in mid-2025. Nonetheless, he remains undeterred, arguing that the underlying demand for Nvidia products will continue to exceed supply. Even with the launch of Blackwell on the horizon, many clients are still relying on the current H100 product. This ongoing demand propels the notion that Nvidia’s stock should be on every trend-follower’s radar.
Market Reaction: Assessing Nvidia’s Stock Performance
Despite this bullish outlook, Nvidia’s stock dipped 2.8% on Tuesday, marking a third consecutive session of decline. The market seems skittish ahead of the earnings report, especially after Nvidia previously disappointed with less-than-expected revenue growth. Analysts, however, now expect a muted beat this quarter, landing on estimates of $38.08 billion in sales and earnings of 83 cents per share.
Truist Securities analyst William Stein chimed in, emphasizing Nvidia’s current valuation. Priced around $134, he described the stock as “quite cheap,” trading at 23 times his estimates for fiscal 2026. Stein set a higher price target of $204, aligning with his bullish sentiment where he sees Nvidia as a strong play for long-term growth.
Competitive Landscape: Evaluating Concerns and Opportunities
One of the key concerns for Nvidia comes from news regarding DeepSeek, a Chinese startup claiming to manufacture AI servers using older-generation Nvidia chips at significantly lower costs. This development worried many investors, but both Lipacis and Stein noted that improvements from DeepSeek are evolutionary rather than revolutionary. They highlighted how prominent tech giants like Amazon (AMZN), Alphabet (GOOG), and Meta (META) have actually raised their AI capital expenditures following DeepSeek’s announcement.
Valuation Insights: Nvidia as an AI Stock Leader
With Nvidia trading at around 30 times earnings estimates for the upcoming 12 months, many analysts believe it remains undervalued—particularly within the AI stock sector. Lipacis voiced that Nvidia is likely the cheapest AI stock in their coverage universe and anticipates a slight beat this quarter, which should bring positive commentary about Blackwell’s visibility and ramp-up in the second half of 2025.
In summary, although concerns loom over limited revenue beats in the immediate future, Nvidia remains a stock that trend-following traders should have on their screen. With strategic advancements and sustained high demand, the potential for significant price appreciation over the coming quarters makes NVDA a must-watch.
Get ready to position yourself wisely in the Nvidia realm for a promising trading year!