There’s seemingly no stopping technology stalwart Nvidia (NASDAQ:NVDA). Following yet another blowout earnings performance, Wall Street analysts saw little choice but to raise their price targets. Surprisingly, though, not everyone is buying the bullish narrative of NVDA stock.
For now, it’s all smiles in Santa Clara, California, where Nvidia calls home. According to CNBC, the tech juggernaut’s fourth-quarter earnings for fiscal year 2024 beat consensus estimates for per-share profitability and sales. Management added to the rising temperature with a current-quarter revenue guidance that rose against even elevated expectations for massive growth.
Specifically, adjusted earnings per share landed at $5.16, beating out the expected print of $4.64. On the top line, revenue clocked in at $22.1 billion, beating out the target of $20.62 billion. In the current fiscal Q1, management disclosed that it sees $24 billion in sales. This figure contrasted nicely against the consensus view of $22.17 billion.
Not surprisingly, several analysts raised their price targets for NVDA stock. They include the following:
- Bernstein’s Stacy Rasgon boosted his firm’s per-share expectation to $1,000.
- Bank of America’s Vivek Arya lifted his Nvidia stock price target to $925.
- JPMorgan Chase’s Harlan Sur increased his per-share view to $850.
Given the tech industry’s obsession with large artificial intelligence (AI) models — many of which are developed on Nvidia’s pricey graphics processors — NVDA stock appears to have a long growth pathway.
Not Everyone Is Buying the Hype Over NVDA Stock
With mere skepticism over NVDA stock — let alone direct short positions — being punished with impunity, many believe that Nvidia is effectively “printing money” to use Rasgon’s words. Nevertheless, legendary investor Warren Buffett once advised investors “to be fearful when others are greedy and to be greedy only when others are fearful.”
It seems there’s a lot of greed going on with NVDA stock. And at least some analysts are taking the Oracle of Omaha’s words to heart.
First, Deutsche Bank’s Ross Seymore noted that the “joyride continues” regarding Nvidia stock. Further, the analyst believes that fundamental momentum favors the tech giant in the near and medium terms. “However, on moderately higher estimates … and after embedding a modest cyclical correction in 2025, we believe NVDA’s earnings potential is sufficiently reflected in the [company’s] current valuation,” Seymore concluded, thus maintaining a “hold” rating.
Second, BCA Research’s Chief Strategist, Dhaval Joshi, was less generous. Per the expert’s analysis, AI has thrust the U.S. tech industry into a bubble. Further, Silicon Valley could be on the precipice of another crash. Essentially, only a few players undergird the explosive growth of the innovation ecosystem. That may not be sustainable, leading to a significant market correction.
Why It Matters
At the moment, analysts are overwhelmingly bullish on NVDA stock, with an average price target of $810.15. Per TipRanks, the breakdown is 32 buy ratings and only one hold. However, Fintel’s options flow screener shows big block transactions for bought puts around the $750 strike price range. Such trades may represent volatility “insurance” bets in case NVDA falls to such levels.
On the date of publication, Josh Enomoto did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
