Despite Nvidia's earnings guidance failing to meet investor expectations, Wall Street analysts remain optimistic, raising the target price for the world's most valuable company.
Analysts are focusing on Nvidia's long-term prospects, particularly the increased production capacity of the Blackwell AI chips and the continued strong demand for orders. At least 10 institutions raised their 12-month target prices after Nvidia released its earnings report on Wednesday, with the average target price increased by 3% to $202.60. Several institutions, including JP Morgan and Truist Securities, emphasized that although the short-term guidance appears slightly weak, the company's long-term growth trajectory remains solid.
Currently, Wall Street holds an overwhelmingly bullish view on Nvidia, with 72 analysts giving a buy rating, only 7 analysts maintaining a hold rating, and just 1 giving a sell rating.
Nvidia provided a relatively modest revenue forecast for the current quarter, expecting third-quarter sales of approximately $54 billion. While this figure aligns with Wall Street's average expectations, some analysts had previously predicted sales would exceed $60 billion. The company's stock price fell about 1.9% in pre-market trading, narrowing the previous decline.
<img src="https://imageproxy.pbkrs.com/https://wpimg-wscn.awtmt.com/46693018-e2e9-4d29-9da2-03add406df3c.png?x-oss-process=image/auto-orient,1/interlace,1/resize,w_1440,h_1440/quality,q_95/format,jpg" alt="" original-src="https://imageproxy.pbkrs.com/https://wpimg-wscn.awtmt.com/46693018-e2e9-4d29-9da2-03add406df3c.png"/>
<h2>Institutions Significantly Raise Target Prices</h2>
Data shows that at least 10 institutions raised their 12-month target prices after Nvidia's earnings report, with the average target price increasing by 3% to $202.60, indicating about a 12% upside from Wednesday's closing price.
JP Morgan analyst Harlan Sur significantly raised the target price by 26% to $215 and reiterated an overweight rating on the stock. Sur pointed out that the increase in Blackwell AI chip production capacity is a key factor:
<blockquote>
&#34;We believe Nvidia's 12-month forward orders continue to exceed supply capacity.&#34;
</blockquote>
Truist Securities analyst William Stein raised the target price by 9% to $228. Although he acknowledged that &#34;sales performance and guidance were slightly below buyer expectations,&#34; he emphasized that &#34;we view this as a minor blemish and focus on the management's resilient long-term outlook.&#34;
<h2>Short-term Guidance Raises Concerns</h2>
Nvidia's revenue forecast of $54 billion for the third quarter, while in line with Wall Street's average expectations, did not meet some analysts' optimistic predictions of over $60 billion. This relatively modest guidance has somewhat affected investor sentiment.
Morgan Stanley analyst Joseph Moore stated that while expectations entering the earnings season were high, &#34;the most important indicators have been validated.&#34; Moore raised the target price from $206 to $210. Since the release of the first-quarter results in May, Nvidia's stock price has risen approximately 35%, with a market capitalization increase of over $1 trillion.
However, the outlook for the Chinese market remains a major uncertainty for Nvidia. Morgan Stanley's Moore stated:
<blockquote>
&#34;The Chinese market remains unpredictable, and the management seems to hold a cautious attitude towards the prospects of resolving related issues.&#34;
</blockquote>

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Analysts are focusing on NVIDIA's long-term prospects, particularly the capacity increase of the Blackwell AI chip and the continued strong demand for orders. At least 10 institutions raised their 12-month price targets after NVIDIA released its earnings report on Wednesday, with the average target price increased by 3% to $202.60

- Despite Nvidia's earnings guidance falling short of investor expectations, Wall Street analysts remain optimistic, raising the company's target price.  
- At least 10 institutions increased their 12-month target price by an average of 3% to $202.60, highlighting strong long-term prospects driven by Blackwell AI chip production and robust order demand.  
- Nvidia's revenue forecast of $54 billion for Q3 aligns with Wall Street's average but does not meet some analysts' expectations of over $60 billion, impacting investor sentiment.

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The outlook outweighs short-term fluctuations, analysts collectively raise NVIDIA's target price