In a research report sent to investors today, Brean Capital analyst Mike Burton maintained a Hold rating on NVIDIA Corporation (NASDAQ:NVDA), even though the company reported a fiscal fourth-quarter beat last night, and guided revenues above the Street. The analyst views the fair value target for NVDA to be a range from $21.75-$23.4.
Burton commented: “While it is apparent that a lot of progress is being made on the Automotive and Accelerated Computing (i.e. Tesla) fronts, we believe Maxwell (GPUs for gaming) drove the real force of the beat. We are increasing our estimates to account for updated guidance.”
The analyst continued, “We believe that NVDA continues to take share from AMD, partially driving the revenue and GM beat this quarter. We note that while it is not a direct compare, NVIDIA’s GPU revenues grew 8% Q/Q and 13% Y/Y vs. 15% and 26% declines for AMD’s Computing & Graphics segment. Given NVDA’s weak PC OEM results, we believe NVDA’s share gains were largely in gaming, and while Management is guiding growth in Q1, we are growing concerned that NVDA may start to run out of share to take (unless the market is completely ceded to them).”
According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Mike Burton has a total average return of 20.2% and a 73.0% success rate. Burton has a -0.2% average return when recommending NVDA, and is ranked #146 out of 3510 analysts.