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On Thursday, Citi analysts increased the price target for NVIDIA shares (NASDAQ:NVDA) to $180 from the previous $150, while sustaining a Buy rating on the stock. The adjustment followed NVIDIA’s announcement of April-quarter results that aligned with forecasts and July-quarter sales reaching approximately $45 billion, which is about $1 billion higher than Citi’s preliminary estimates. This performance effectively navigated the company through the challenging transition period related to the China H20 ban. InvestingPro data shows NVIDIA maintains excellent financial health with a perfect Piotroski Score of 9, though current analysis suggests the stock is slightly overvalued at current levels.
NVIDIA’s Blackwell product line reported sales of $24 billion, surpassing the anticipated $20 billion, and management has reiterated its target for mid-70s gross margins. This confidence is based on improving Blackwell profitability and the absence of significant impacts from tariffs. The company has already demonstrated strong execution with current gross margins at 75% and impressive revenue growth of 114% over the last twelve months. With gross margins expected to expand through the January quarter, Citi analysts believe NVIDIA’s stock is poised to exit its range-bound movement observed since mid-last year and potentially reach a new 52-week high.
The upcoming Citi Silicon Valley Bus Tour, scheduled for next week, and the GTC Paris event from June 11-12 are seen as potential positive catalysts for NVIDIA’s stock. During these events, announcements related to sovereign AI in Europe are anticipated. NVIDIA has also discussed its vision for AI factories, which could represent a data center opportunity worth approximately $50 billion for every gigawatt of capacity.
Citi has adjusted its EPS forecasts for NVIDIA for fiscal years 2026, 2027, and 2028. The revisions reflect flat growth for FY26, a 9% increase for FY27, and a 5% rise for FY28, all attributed to higher gross margins. Consequently, the price target has been lifted to $180, based on a consistent 30x P/E ratio. The firm’s analysts have reiterated their Buy rating on NVIDIA’s stock, signaling confidence in the company’s financial trajectory and market position.
In other recent news, NVIDIA reported robust financial results, with first and second fiscal quarter revenues of $44 billion and $45 billion, respectively. These figures align with Deutsche Bank (ETR:DBKGn)’s estimates, despite challenges in China affecting revenue and gross margins. Deutsche Bank raised NVIDIA’s stock price target to $145, maintaining a Hold rating, while Bernstein reiterated an Outperform rating with a $185 target, highlighting potential upside if the company navigates current restrictions successfully. Summit Insights upgraded NVIDIA from Hold to Buy, citing confidence in datacenter capital expenditures benefiting NVIDIA’s AI GPU and datacenter networking businesses.
TD Cowen raised their price target for NVIDIA to $175, reaffirming a Buy rating, noting that concerns over rack-scale performance are diminishing. Jefferies maintained a Buy rating with a $185 target, emphasizing the resolution of inventory issues and the ramp-up of NVLink deployments. NVIDIA’s management has been transparent about the challenges posed by regulatory headwinds in China, and analysts have recognized this approach. The company continues to focus on meeting increasing demands for computing power, with significant commitments from major cloud service providers and growth in networking revenue.
Overall, NVIDIA’s recent developments reflect a mix of challenges and opportunities, with analysts expressing varied levels of confidence in the company’s ability to navigate the current landscape.
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