NVDA Stock: Nvidia Investors Should Be on Alert the Next 90 Days


  • Nvidia (NVDA) stock is slipping this afternoon after starting the session higher.
  • Early positive sentiment today came from Citi analysts, who launched a 90-day positive catalyst watch.
  • NVDA stock faces a significant test for the upcoming Q1 earnings report.
NVDA stock - NVDA Stock: Nvidia Investors Should Be on Alert the Next 90 Days

Source: Evolf / Shutterstock.com

While Nvidia (NASDAQ:NVDA) shares may be in a consolidation pattern currently, Citi analysts just reaffirmed their bullish assessment of NVDA stock. In particular, Citi believes investors should be on a “90-day positive catalyst watch.”

According to Seeking Alpha, Citi is optimistic about supply-chain discussions that suggest demand for Nvidia’s GPUs could extend into the first half of 2025. This projection aligns with Citi’s own estimates of the GPU market.

“We expect supply chain commentary from key foundry/HBM [high-bandwidth] memory suppliers during earnings and Computex Taiwan on June 2nd where NVIDIA CEO Jensen Huang will deliver a keynote which could be positive catalysts for the stock,” said analyst Atif Malik.

Per TipRanks, Citi reiterated a “buy” rating on NVDA stock along with a $1,030 price target. That price target implies nearly 17% upside potential from Friday’s closing price.

Still, it’s worth noting that NVDA stock is down about 3% in the past one month. While that’s not a remarkable loss in and of itself, it marks a sharp contrast to Nvidia stock’s previous blistering growth.

NVDA Stock Faces a Q1 Litmus Test

Another factor partially clouding the bullish narrative for NVDA stock is the upcoming first-quarter earnings report. While Nvidia has demonstrated a remarkable ability to beat earnings projections so far, the performance may not last indefinitely.

Data from Yahoo Finance reveals that, for fiscal 2024, the company’s positive average earnings surprise comes out to 19.5%. That’s an impressive achievement. However, it’s also worth pointing out that the magnitude of the surprise has been progressively slipping since Q2 2023, down from 29.2% to 11.3% in the last quarter.

For the upcoming Q1 report, analysts expect EPS to land at $5.53 on revenue of $24.4 billion. That’s a massive leap from the year-ago quarter’s estimate of 98 cents on sales of $6.52 billion. For the current year, analysts are looking for EPS of $24.48 on $110.47 billion in revenue.

Still, as NVDA marches higher, it may be increasingly difficult for Nvidia to attract investors based on comparative performance metrics.

Why It Matters

Currently, analysts shows little sign of concern, with NVDA stock landing a consensus strong buy view. Out of 41 analysts, 39 rate shares as a buy while two experts rate the stock as a hold. Overall, the average price target stands at $989.53, implying 15% upside potential.

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.

A former senior business analyst for Sony Electronics, Josh Enomoto has helped broker major contracts with Fortune Global 500 companies. Over the past several years, he has delivered unique, critical insights for the investment markets, as well as various other industries including legal, construction management, and healthcare. Tweet him at @EnomotoMedia.

Article printed from InvestorPlace Media, https://investorplace.com/2024/04/nvda-stock-nvidia-investors-should-be-on-alert-the-next-90-days/.

©2024 InvestorPlace Media, LLC