Nvidia stock price target raised to $220 from $190 at Benchmark

Investing.com - Benchmark raised its price target on NVIDIA (NASDAQ:NVDA) to $220.00 from $190.00 while maintaining a Buy rating following the company’s latest quarterly results. The semiconductor giant, now valued at $4.43 trillion, is trading near its 52-week high of $184.48, though InvestingPro analysis suggests the stock is currently overvalued.

NVIDIA reported revenue of $46.7 billion, exceeding its original guidance by $1.7 billion and consensus estimates by $700 million. The company achieved this despite facing export restrictions on its H20 GPUs for the Chinese market, which had an estimated $4 billion impact in the quarter.

The chipmaker’s total sales increased 6% quarter-over-quarter and 56% year-over-year. NVIDIA’s quarterly results included $650 million in sales of its H20 processor to customers outside of China, which Benchmark noted would put the company’s performance just in line with Street expectations if adjusted.

NVIDIA posted a gross margin recovery to 72.7%, approaching levels seen before the H20 ban took effect, compared to 61% in the previous quarter. Operating expenses grew 6% sequentially as the company continued heavy investment in its product development roadmap.

The company reported earnings per share of $1.05, which included the sale of $180 million of previously reserved H20 inventory. Excluding this inventory reserve reversal, EPS would have been $1.04, slightly above the consensus estimate of $1.01.

In other recent news, Nvidia reported second-quarter revenue of $46.74 billion and earnings per share of $1.05, surpassing analyst expectations of $46.23 billion and $1.01, respectively. The company’s gaming segment generated $4.3 billion in revenue, which was significantly above market forecasts. Following these results, Bernstein raised its price target on Nvidia to $225 from $185, maintaining an Outperform rating. Cantor Fitzgerald reiterated its Overweight rating with a $240 price target, noting Nvidia’s revenue guidance of $54 billion for the October quarter, which exceeds the consensus estimate of $52.6 billion. Stifel maintained its Buy rating and a $212 price target, highlighting that the company’s gaming segment drove the better-than-expected results, though Data Center revenue grew more modestly. Rosenblatt increased its price target to $215 from $200, citing Nvidia’s ramp-up of Grace Blackwell-based racks as a significant development. Needham also reiterated its Buy rating with a $200 price target, acknowledging Nvidia’s better-than-expected second-quarter results while noting challenges in China. These developments reflect a strong performance by Nvidia and varied analyst reactions.

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