Top analyst Rajvindra Gill at Needham is positive on NVIDIA Corporation (NASDAQ:NVDA) prospects after meeting with EVP and CFO Collette Kress yesterday to delve deeper into the chip giant’s computing platforms. In reaction, the analyst reiterates a Buy rating on shares of NVDA while lifting the price target from $100 to $120, which represents a just under 16% increase from current levels.
Gill asserts, “Mentioned in our previous note, we believe that NVDA is the only open-ended growth story in Semiconductors by targeting Gaming, VR/AR, Datacenters, and ADAS. Following JenHsun’s opening remarks we came away with a better view of NVDA’s plan to become a major deep learning platform company. We are raising our price target to $120 following these announcements. We believe NVDA can generate a base case $3.10 of earnings power in FY18 and we have formulated a bull case scenario of $3.70-4.00 (and $5-6 earnings power by 2018/19 through ADAS). Net, this increase is based on several long-term secular trends: ADAS, a ~$6B TAM, machine learning and AI in data centers, and growth in professional Gaming and VR/AR markets.”
Moving forward, the analyst is particularly confident on NVDA’s AI partnerships and car platform, thanks to Audi’s plans to have Level 4 cars out driving the roads by the year 2020, thanks to NVDA’s Drive PX 2 and DriveWorks software. With a lot of new artificial intelligence chip technology in the works, all roads point to a bullish outlook on the giant.
Rajvindra Gill has a very good TipRanks score with a top five-star ranking, a 60% success rate, and a high standing of #86 out of 4,348 analysts. Gill earns 13.8% in his annual returns. When recommending NVDA, Gill gains 12.3% in average profits on the stock.
TipRanks analytics exhibit NVDA as a Buy. Out of 26 analysts polled by TipRanks in the last 3 months, 18 are bullish on NVIDIA stock, 7 remain sidelined, and 1 is bearish on the stock. With a return potential of nearly 1%, the stock’s consensus price target stands at $104.11.