Nvidia Stock Hit New All-time High, BofA Sets Street High Price Target
Nvidia stock price hit a new all-time high after the Ampere gaming event where the company announced that its mainstream RTX 3080 and 3070 cards are priced at $699 and $499, respectively. The pricing of both cards is $100 cheaper compared to the speculated $799/$599 pricing before the event.
BofA has provided a price target of $600 as the firm estimates 15% year over year conservative gaming segment sales growth for CY21 and 8% for CY22.
“Bigger picture, we believe NVDA has an unassailable hardware/software/developer lead in some of the largest and fastest-growing markets in semis/tech (AI, Gaming, Autonomous), all derived from a common architecture, that can potentially drive sales at a 20%+, EPS at a 25%+ pace to head towards $22/sh by CY24E,” BofA said.
Nvidia stock price soared 134% year to date amid robust demand from gaming and data center. The shares of chipmaker jumped 230% in the past twelve months.
Needham has also provided a $600 price target. “Our new price target is 49x our CY22 (FY23) EPS estimate of $12 plus net cash of $6/share. With long-term revenue growth of 20%+, a gross margin approaching 68-70%, and an operating margin of 43-46%, we believe this multiple is well justified,” the firm said.
Nvidia stock price is currently trading around $570. The stock price looks significantly overvalued based on valuations. However, the shares are receiving support from robust financial growth.
The chipmaker has generated second-quarter revenue of $3.87 billion, up 50% year over year. Its data center revenue of $1.75 billion grew 167% from a past year period.
Nvidia expects more acceleration in its revenue growth in the coming quarters. The company has generated third-quarter revenue in the range of $4.40 billion.
“Despite the pandemic’s impact on our professional visualization and automotive platforms, we are well-positioned to grow, as gaming, AI, cloud computing and autonomous machines drive the next industrial revolution around the world,” Jensen Huang, founder, and CEO of NVIDIA said.