Stifel reiterates Buy rating on Nvidia stock, maintains $250 price target

Investing.com - Stifel has reiterated its Buy rating on Nvidia (NASDAQ:NVDA) stock with a price target of $250.00 following the company’s better-than-expected quarterly results. This aligns with the broader analyst consensus, which remains strongly bullish with a 1.34 recommendation score according to InvestingPro data.

Nvidia reported revenue of $57 billion, representing a 62% year-over-year increase and 22% sequential growth, driven primarily by strength in data center compute and networking segments, which together grew to $51.2 billion, up 66% year-over-year and 25% quarter-over-quarter. This performance continues Nvidia’s impressive 71.55% revenue growth over the last twelve months, with the company maintaining a robust 69.85% gross profit margin.

The company’s Blackwell architecture ramp is fully underway, with the GB300 chip now accounting for approximately two-thirds of the overall Blackwell product mix. Networking revenue reached $8.2 billion, surging 162% year-over-year and 13% quarter-over-quarter, now representing 16% of the overall data center mix compared to 10% in the year-ago quarter.

Nvidia achieved an adjusted gross margin of 73.6%, slightly exceeding guidance, and forecasts fourth-quarter revenue of $65 billion, representing a 65% year-over-year increase and 14% sequential growth, with an expected gross margin of 75%. Despite these strong results, InvestingPro analysis suggests Nvidia may be slightly overvalued at its current price, trading at a P/E ratio of 53.13, though its PEG ratio of 0.81 indicates reasonable valuation relative to growth expectations.

The company is significantly increasing its expenses, with operating expenditures rising 19% quarter-over-quarter, as it continues to invest in supporting the multi-trillion-dollar artificial intelligence infrastructure build-out, with Stifel noting that cloud providers remain sold out of AI infrastructure capacity. With a market capitalization now exceeding $4.5 trillion and analyst price targets ranging from $140 to $350, investors seeking deeper insights can access Nvidia’s comprehensive Pro Research Report and 18 additional ProTips through InvestingPro.

In other recent news, Nvidia reported impressive earnings with October quarter revenue reaching $57 billion, surpassing consensus estimates of $55.2 billion. The company also provided guidance for January quarter revenue at $65 billion, exceeding the market’s expectation of $61.8 billion. These strong results have led several firms to adjust their outlooks on Nvidia. Mizuho raised its price target to $245, citing the solid quarterly performance and guidance. Bernstein increased its target to $275, highlighting positive trends in artificial intelligence and related partnerships. Jefferies adjusted its price target to $250, noting "rock-solid" results that alleviate investor concerns about AI spending. KeyBanc also raised its target to $275, attributing the upside to robust data center revenues. Meanwhile, Rosenblatt Securities increased its price target to $245, emphasizing the sustained demand for AI computing. These developments indicate a positive sentiment among analysts regarding Nvidia’s future performance.

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