(Bloomberg) — A slew of Wall Street analysts covering Nvidia Corp. are boosting their expectations for the chipmaker’s stock ahead of its quarterly earnings release due Aug. 27.
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At least nine analysts have lifted their 12-month price targets on the company this week alone, raising the average price by 3% to nearly $194, the highest on record. The level implies more than 10% upside from where shares traded at Wednesday’s close, according to data compiled by Bloomberg.
“What you’re seeing is the recognition that growth at Nvidia is rock solid,” said Brian Mulberry, client portfolio manager at Zacks Investment Management. “Analysts are raising projections because they simply need to; the stock is not going to slow down.”
The boosted expectations come amid a selloff in megacap technology companies — Nvidia included — that’s pulled the S&P 500 Index from record highs. Investors are looking to take profits and reallocate to less-risky sectors of the market after several major tech stocks reached sky-high valuations. Rising doubts that the Federal Reserve will cut interest rates in September have fueled the rout ahead of Chair Jerome Powell’s Friday speech.
Nvidia’s shares traded lower intraday Thursday for the third consecutive day, but remain up about 30% from the company’s last earnings release at the end of May. In the roughly 70% rally from the April tariff-tantrum selloff, Nvidia has contributed more than 180 points to the S&P 500’s gain, more than any other member.
Given the stock’s weight in the S&P 500 Index — it’s the largest constituent — and its importance in the artificial intelligence trade, Nvidia has long endured incredibly lofty expectations from Wall Street analysts and investors alike. So far, the earnings season has signaled positive read-throughs for the chipmaker’s quarterly results as megacap technology companies including Meta Platforms Inc., Microsoft Corp., Alphabet Inc. and Amazon.com Inc. increased pledges for billions of dollars in capital expenditures. Nvidia, which derives some 40% of revenue from those four companies, is likely a main beneficiary.
Analysts expect the company to report yet another quarter of double-digit revenue growth next week. While questions still remain around Nvidia’s ability to sell in China, any update should lead to upside.
