Stock Mogul Divests Entire Nvidia Holdings - Should You Follow Suit?
Nvidia Corporation (NVDA) has received a cautiously optimistic outlook from analysts following the release of its latest quarterly results, with a consensus leaning towards a moderately bullish stance. The stock is expected to see a potential upside of around 12-15% in the next 6-9 months, according to a report by CNBC.
The base case price target range for Nvidia stock by the end of 2025 is roughly between $170 and $190, factoring in steady growth in AI demand and manageable challenges in the China market. This optimistic forecast is supported by Nvidia's robust AI partnerships, significant R&D investments, strong cash reserves, and collaboration with Taiwan Semiconductor Manufacturing Co. for chip supply security.
A more conservative forecast from 24/7 Wall St. sets a median one-year price target at about $147.70 for 2025, implying approximately a 2-6% upside from current prices. Longer-term estimates reach $241.23 by 2030, a 52.68% increase over today’s price, based on strong earnings per share (EPS) growth and stable price-to-earnings (P/E) ratios.
Analysts expect a 100% increase in revenue and a nearly 150% increase in earnings per share for the fiscal year 2025. Goldman Sachs set its price target for Nvidia from $150 to $165, while Morgan Stanley increased its price target for Nvidia from $160 to $168. Some analysts, such as Mirae Asset Securities, have raised their price target after the quarterly results, with Mirae Asset Securities analysts raising their price target for Nvidia from 180 to 206 USD.
Despite the positive outlook, risks remain. U.S.-China trade tensions, potential supply constraints with the Blackwell chip, and slowing capital expenditures among hyperscalers could negatively affect growth projections. Notably, well-known billionaire Stanley Druckenmiller, who invested in Nvidia in the fourth quarter of 2022, has since sold all of his Nvidia shares by the end of the third quarter.
Nvidia's expected upside of around 12-15% in the near term and its leadership in AI technology position it favorably compared to the broader market averages, which typically forecast lower single-digit gains. Its premium valuation (high P/E ratios up to 70 in bullish scenarios) reflects strong investor confidence in its dominant role in AI and semiconductor markets.
The majority of analysts recommend buying Nvidia stock, with Goldman Sachs analysts commenting that Nvidia achieved strong results in the third quarter and have a buy rating on NVDA. The results exceeded expectations across the board, with the stock gaining over 200% last year and already up around 200% this year.
In summary, Nvidia’s stock is seen by most analysts as well-positioned for continued growth and premium valuation, with price targets ranging from about $147 to $250 by the end of 2025 depending on market and geopolitical conditions, outpacing the average market expectations in tech equities. The company's strong performance and positive outlook are expected to continue as it navigates the dynamic AI and semiconductor markets.
[1] CNBC, Nvidia stock price forecast: Analysts see 12-15% upside for Nvidia stock in next 6-9 months, 12 May 2023. [2] 24/7 Wall St., NVIDIA Stock Prediction: How High Can NVDA Stock Go?, 15 May 2023. [3] Barron's, Nvidia Stock Forecast: Analysts See Strong Growth Ahead, 16 May 2023. [4] Reuters, European Commission to invest $23 billion in AI, 10 May 2023.
Technology advancements and strategic investments in AI are expected to drive Nvidia's finance growth, with analysts predicting an upside of around 12-15% in the near term. The potential for further investing opportunities lies in the long-term, with price targets reaching as high as $250 by 2025.
