There are many different investment and trading strategies that strategic investors use to try to make outsized gains. One common theme is to buy companies that keep exceeding earnings estimates with “beat and raise” their earnings and revenue consistently.
With that theme in mind, some investors and traders want to jump the gun and get that big performance without having to wait and see what the news is. This is where investors and traders go after strong companies with great track records that are seeing Wall Street analysts raise their expectations in the days and weeks ahead of their respective earnings reports.
NVIDIA Corporation (NASDAQ: NVDA) has seen this pattern before, but it has been seeing it right before this November’s earnings report. It’s like the $3.6 trillion market capitalization just doesn’t even matter.
Any analyst can upgrade a stock or raise their targets after an earnings report. In fact, that’s what most of them do. But some analysts get extra conviction and stick their name and reputation on the line. And analysts know that there will come a day when NVIDIA’s high valuations and the law of large numbers will catch up to it. The analysts just don’t seem worried this is that time.
WHAT ANALYSTS ARE SAYING
Oggonomics has tracked well over a dozen analyst reports calling for favorable developments with earnings. The analyst community continues to have Buy or Outperform ratings in general and the price targets keep getting hiked. After closing up about 4.89% at $147.01, NVIDIA’s stock is still under the consensus target price of $160.86 in the Finviz data.
With a 52-week high of $149.77, the Tuesday close of $147.01 appears to be the fourth highest closing price since the election. These are some of the analyst calls with reiterated ratings and/or hiked price targets, shown in order of the most recent calls first:
- Stifel (buy) target to $190 from $165 (11/19)
- Truist (Buy) target to $167 from $148 (11/19)
- Rosenblatt (Buy) maintained at $200 as the street-high target (11/18)
- CFRA reiterated Buy and reiterated its $160 target (11/18)
- Wedbush (Outperform) target to $160 from $138 (11/14)
- Raymond James (Strong Buy) target to $170 from $140 (11/14)
- Susquehanna (Positive) target to $180 from $160 (11/14)
- HSBC (Buy) target to $200 from $145 (11/14)
- Oppenheimer (Outperform) target to $175 from $150 (11/14)
- Citigroup (Buy) target to $170 from $150 (11/13)
- Mizuho (Outperform) target to $165 from $140 (11/12)
- Redburn Atlantic started with a Buy rating and set a $178 price target (11/12)
- UBS (Buy) target to $185 from $150 (11/11)
- Melius Research (Buy) target to $185 from $165 (11/11)
- Morgan Stanley (Overweight) target to $160 from $150 (11/11)
- Piper Sandler (Overweight) target to $175 from $140 (11/11)
- BofA (Buy) price objective to $190 from $165 (10/17)
THE OTHER SIDE OF THE COIN
While it has had very little impact on NIDIA’s stock, expectations for Blackwell may be muted for the January quarterly outlook as NVIDIA sometimes takes a somewhat conservative view ahead to keep some expectations from getting too far ahead of themselves. A recent report from The Information cited certain rack issues causing overheating. So far NVIDIA has been able to downplay the concerns as Jensen Huang recently suggested that the design flaws were being fixed.
NVIDIA did not see a massive post-election bounce because its A.I. lead seems solidified regardless of who would have been President. That said, NVIDIA shares are up 2.3% in the last month, up 14.5% in the last 90-day period, up 196% YTD and up 198% versus a year ago. This seems to be a quarterly autopilot warning — any serious disappointment and guidance would be expected to be followed by a significant round of profit taking as the market cap is a whopping $3.6 trillion at this point.
DISCLAIMER
Oggonomics always reminds investors and its readers that no single analyst report should ever be the sole basis to buy or sell a stock. That decision to buy or sell, or hold or short sell, is up to each investor and the decision should be made with a financial advisor. And there are of course no assurances that any of the price predictions and the scenarios that back the calls up will actually come to fruition — even if more than a dozen price hikes have been shown.
Oggonomics does not have a formal rating or price target on NVIDIA. The ratings and targets have been issued by each firm named. Regardless of how those firms have rated the stock, Oggonomics does not intend for this reporting to be interpreted as investment advice. It is also not a recommendation to buy or sell (or hold, avoid or short-sell) any of the stocks mentioned.
Each investor is responsible for their own investing decisions. Those decisions should be made with a financial advisor.
