Chipmaker Nvidia offered just enough upside to its fiscal first-quarter guidance to keep the rally going for Nvidia stock, Wall Street analysts say.
Nvidia late Wednesday delivered better-than-expected fiscal fourth-quarter results and guided above views for the current period.
Mizuho Securities analyst Vijay Rakesh called Nvidia's outlook "a Goldilocks guide" for providing a forecast that was just right for investors.
On the stock market today, Nvidia stock jumped 16.4% to close at 785.38. That put it back in record high territory after falling during the last four trading sessions. In intraday trading, NVDA stock notched an all-time high of 785.75.
Nvidia's report also had positive implications for data-center computer builder Super Micro Computer, aka Supermicro. Shares of Supermicro surged 32.9% to 975.52 on Thursday.
Continued Strong Demand Into 2025
On a conference call with analysts, Nvidia Chief Executive Jensen Huang said he doesn't see demand slowing for the company's artificial-intelligence processors.
"Fundamentally the conditions are excellent for continued growth — calendar 2024 to calendar 2025 and beyond," Huang said. "We expect that demand will continue to be stronger than our supply provides."
Two industrywide trends are fueling Nvidia's growth, he said. They are generative AI and the transition to accelerated computing from general-purpose computing.
In its fiscal fourth quarter ended Jan. 28, Nvidia's earnings rocketed 486% year over year to an adjusted $5.16 a share. Sales surged 265% to $22.1 billion.
For the current quarter, Nvidia expects to earn an adjusted $5.41 a share on sales of $24 billion. Analysts had been looking for earnings of $5.02 a share on sales of $22.2 billion in the fiscal first quarter. In the year-earlier period, Nvidia earned an adjusted $1.09 a share on sales of $7.19 billion.
Nvidia Stock Scores Price-Target Hikes
"The beat and guide were good enough to sustain confidence, but not too high to worry investors (that the) 'peak was near,'" Jordan Klein, managing director for tech, media and telecom sector trading at Mizuho Securities, said in a client note.
At least 24 Wall Street firms raised their price targets on Nvidia stock to keep up with its surging shares.
TD Cowen analyst Matthew Ramsay reiterated his outperform rating on Nvidia stock and raised his price target to 900 from 700.
"Another blowout quarter for Nvidia," he said in a client note.
Goldman Sachs analyst Toshiya Hari kept his buy rating on Nvidia stock and upped his price target to 875 from 800.
"Nvidia delivered against what was seemingly a very high bar with Data Center once again serving as the key growth driver," Hari said in a client note.
Nvidia will benefit from continued strong spending on generative AI infrastructure, especially by cloud service providers and consumer internet companies, he said. Also, Nvidia is seeing increased adoption of AI by enterprise customers and sovereign states.
Plus, Nvidia will get a lift from new products, including its H200 data-center graphics processing unit and Spectrum-X networking system, Hari said.
Meanwhile, Nvidia stock is on five IBD Lists: IBD 50, Leaderboard, Big Cap 20, Sector Leaders and Tech Leaders.
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