Bullish indicating open at $55-$60, IPO prices at $37
On Monday, Citi analysts reiterated their Buy rating for NVIDIA (NASDAQ:NVDA) shares, maintaining a price target of $163.00. According to InvestingPro data, NVIDIA boasts a perfect Piotroski Score of 9, indicating exceptional financial strength. The firm’s analysis followed NVIDIA’s recent sales reports, which showed January and April-quarter sales reaching $39 billion and $43 billion, respectively. These figures slightly exceeded Citi’s projections of $38 billion and $42.5 billion, continuing the company’s impressive revenue growth trend of 152% over the last twelve months.
NVIDIA’s Blackwell sales hit $11 billion, surpassing Citi’s estimates of $10 billion. The company’s growth trajectory for Blackwell appears to be on course after experiencing setbacks in the previous year. NVIDIA anticipates strong growth into 2025. The demand for inference technology is gaining momentum, especially following the development of complex reasoning models such as DeepSeek, which require significantly more computational power compared to simple one-shot inference tasks.
However, NVIDIA’s gross margin outlook fell short of expectations, coming in at 170 basis points and 80 basis points below Citi’s and Wall Street’s forecasts, respectively. This shortfall was attributed to the initial product mix of Blackwell, but margins are expected to improve to the mid-70s percentile by the end of the fiscal year. Currently, InvestingPro data shows NVIDIA maintains an impressive gross profit margin of 75.86%. In response to these financial insights, Citi has adjusted its fiscal year 2026 and 2027 earnings per share (EPS) estimates by a decrease of 1 cent and an increase of 35 cents, respectively.
The report by Citi also noted that while the GPU Technology Conference (GTC) typically acts as a catalyst for NVIDIA’s stock, potential new regulatory challenges from China, semiconductor tariffs, and gross margin concerns may limit stock price movement in the short term. Based on InvestingPro analysis, NVIDIA is currently trading slightly above its Fair Value, with a P/E ratio of 50.63. Nonetheless, Citi suggests that for long-term investors who can overlook these issues, NVIDIA’s valuation is appealing at 23 times the calendar year 2026 EPS. The current stock price presents an attractive entry point for these investors. InvestingPro subscribers have access to 18 additional key insights about NVIDIA, including detailed valuation metrics and growth projections.
In other recent news, NVIDIA Corporation’s financial performance has been under scrutiny, with several analysts providing updated insights. NVIDIA’s recent earnings report showed a slight outperformance, aligning with Wolfe Research’s expectations, which maintained an Outperform rating and a $180 price target. Meanwhile, Bernstein analysts raised their price target for NVIDIA to $185, noting the company’s successful navigation of supply chain challenges and the full production ramp-up of its Blackwell product line. Truist Securities also adjusted its price target to $205, citing key operational developments such as the delivery of the GB200 NVL72 and increased demand following the release of DeepSeek.
However, Summit Insights downgraded NVIDIA from Buy to Hold, citing concerns about inflated expectations and potential deceleration in growth due to market dynamics. Despite these concerns, Stifel reaffirmed its Buy rating with a $180 price target, highlighting significant growth in NVIDIA’s Data Center segment and optimism for the upcoming transition to the B300/GB300 systems. Analysts from these firms emphasize NVIDIA’s strong market position and ongoing innovation, though they express varying degrees of optimism about the company’s future performance. These developments reflect a mix of confidence and caution among analysts regarding NVIDIA’s financial outlook and market strategy.
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