UBS raises price target on Nvidia ahead of earnings, says tailwinds ‘remain strong’
UBS is growing more bullish on Nvidia ahead of the company’s second-quarter earnings results due out next week. On Thursday, the firm reiterated its buy rating on the artificial intelligence chip darling and raised its price target to $205 from $175. That implies nearly 17% upside from Wednesday’s close. “We see overall demand signals as strong as ever (Oncor ~40GW of “high confidence” new load requests for data center just in TX, though some of this may be 2x ordering to “get in line”) and expect NVDA’s commentary to reflect this very strong backdrop with commentary from GB200/GB300 rack partners suggesting 30k racks is doable this year with a strong CQ4 ramp,” analyst Timothy Arcuri wrote, adding that “tailwinds remain strong.” Arcuri also expects the chipmaker to still see a few billion dollars per quarter added back on the heels of the company hashing out a deal with the U.S. government to sell H20 chips in China in exchange for 15% in revenues from those sales. “There is likely some re-usable H20 inventory that had been written down, but we believe NVDA did place new Hopper wafer orders upon receipt of H20 license news and we still believe it is working on a Blackwell version as the US government likely (in our view) raises the ceiling of what is allowed to ship into China as part of its rare earth deal efforts,” the analyst also said. Overall, Arcuri sees Nvidia posting a roughly $1 billion beat in revenue for the second quarter. Like Arcuri, most analysts on Wall Street are taking a bullish stance on the chipmaker heading into its quarterly results, as 58 out of 65 analysts covering it have a strong buy or buy rating, according to LSEG. The move comes as shares have already been seeing solid gains this year, rising more than 30%. The stock was also almost 1% higher in the premarket Thursday. Nvidia is scheduled to report earnings after the bell next Wednesday.
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