Nvidia shares boosted this Thursday, increasing Wednesday’s gains after a Citigroup analyst named Atif Malik increased his price target on the company after their 4-for-1 split.
Malik raised his one-year target on the company to $223 from $180 and maintained his buy rating on the shares after the 4-to-1 split which happened this week during what he says is recovering demand for Nvidia’s products, despite the previous pullback.
Specifically, Malik stated in a research note to his clients that he sees any crypto linked or gaming linked pullback in the second part of 2021 as an opportunity to buy as Nvidia prepares to launch its next generation of GPUs in 2022, and its new Grace CPU in 2023.
In May, Nvidia unveiled its plans to do a 4-for-1 stock split to allow more people to buy shares. The split went into effect this week.
Analysts have praised Nvidia since their Q1 results, which came in even better than expected during strong hyperscale data center demand, which included a demand for its GPU products for both video games and mining crypto.
Even before this, analysts were bragging over Nvidia’s performance given the huge demand for its gaming products, which surged during the pandemic and stay-at-home orders that increased demand for in-home entertainment such as video games, made worse by the global chip shortage that boosted the demand, along with prices, for the chips used within the cards themselves.
Jim Cramer is bullish on Nvidia, and has been for some time, not just because the company’s long-term prospects but also due to its strategy to buy Arm Holdings, a British company that designs CPUs that are used in cellphones, tablets and PCs and Macs, which will boost its already good sales pipeline that has been linked to demand from crypto miners.
For its fiscal Q2 which ends in July, Nvidia anticipates revenue of $6.3 billion, higher than FactSet’s estimates of $5.47 billion, fueled by gains among all its segments, led by cryptocurrency, data center, and video games.
At last count, shares of Nvidia were higher by 0.76% at $195.58. The stock is higher by 2.77% in the previous month and over 48% since the beginning of the year.
Author: Scott Dowdy