Nvidia’s stock rose more than 3% on strong trading volume after UBS and Wells Fargo considerably upped their price targets for the chipmaker. This added to the already high expectations ahead of Nvidia’s forthcoming quarterly earnings announcement.
UBS analyst Timothy Arcuri lifted his price target to $540 from $475, while Wells Fargo increased its price target to $500 from $450. To this effect, analysts anticipate that Nvidia will record good earnings in the second quarter of 2023. They anticipate sales of $11.13 billion, a 66% increase over the same period last year. Earnings per share are predicted to be $1.30, a 68% increase over the previous year.
Nvidia’s stock is up more than 150% this year, making it one of the best-performing stocks in the S&P 500. The company’s shares are trading at a price-to-earnings ratio of over 60, which is high by historical standards, but some analysts believe that the stock is still undervalued given its growth prospects.
There is a strong relationship between the company’s AI chip demand and its following market success, as seen by Nvidia’s prior significant stock jump of 24% on May 25th, which was ascribed to the company’s healthy second-quarter sales estimate. These AI processors, which enable technologies like ChatGPT, continue to prove their market value.
The sources for this piece include an article in Reuters.