When a stock gets bullish coverage from a leading brokerage, then it generally experiences a rally, and that is what happened with NVDA stock this morning. Analyst Stacy Rasgon at Bernstein delivered a bullish report on Nvidia Corporation (NASDAQ:NVDA), which resulted in a 5% stock rally today.
Raises Price Target
Rasgon graded Nvidia stock as ‘outperform’ and stated that some upcoming catalysts in the near term, in addition to the resumption of hyper-scale spending at the company, are some of the factors behind the rating. In addition to that, he raised the target price on NVDA stock to $360 a share, which reflects an upside of as much as 21% from the $296.57 closing price on Tuesday.
The previous target price had been set at $300 a share, and while Rasgon did concede the target price may be “rich,” he added that the current surge in NVDA stock is based on stronger fundamentals. He stated that the company’s decision to return to hyper-scale builds, higher traction for the Turing graphics processing unit, and a better gaming profile that is independent of cryptocurrencies are some of the factors behind the bullish stance.
Solid Earnings
While the latest rally is possibly due to the bullish analyst report, it should be pointed out that NVDA stock had rallied by as much as 7% this past Thursday. The company declared its earnings for the fourth quarter on Thursday and beat analysts’ expectations for the bottom line and the top line.
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Nvidia generated revenue of $3.11 billion and comfortably beat analysts’ estimates of $2.96 billion. Earnings per share stood at $1.89 per share, which was also higher than analysts’ estimates of $1.66 per share. Datacenter revenue came in at $958 million, which is a new record for the company. However, Nvidia cut its revenue projections for the first quarter by as much as $100 million due to the coronavirus scare.
NVDA stock is now up by 5% at $311.31 and made an all-time high of $311.80.
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