Wall Street analysts are going ga-ga over the demand and sales expectations from Nvidia’s (NVDA) data center segment and Blackwell chips. Yesterday, analysts from Morgan Stanley and UBS reiterated their Buy ratings and $150 price target (12.9% upside potential) on NVDA stock, citing massive demand for Nvidia’s products due to the current generative AI (artificial intelligence) frenzy. Nvidia stock surged over 4% yesterday, following bullish comments from analysts.
Nvidia has overtaken Microsoft (MSFT) as the second biggest trillion-dollar company in the world, while iPhone maker Apple (AAPL) retains the number one spot. Keeping in mind Nvidia’s rising popularity on Wall Street, let’s quickly look at the latest analyst comments.
MS Expects Blackwell Revenues to Surpass Hopper
Morgan Stanley analyst Joseph Moore expects revenues from Nvidia’s Blackwell chips to surpass its predecessor Hopper chip’s revenues in Q1 2025. Moore cited Nvidia CEO Jensen Huang’s recent remarks on the “insane” demand for Blackwell chips to substantiate his views. Blackwell chips are expected to have 2.5x more computing power compared to Hopper chips.
Moore highlighted that according to his firm’s checks of the GPU (graphics processing unit) testing supply chain, Nvidia could produce 250,000-300,000 units of Blackwell chips in Q4 2024, contributing roughly $5 to $10 billion in revenues. Going ahead, in Q1 2025, Moore projects Blackwell chip output to jump to 750,000 to 800,000 units, roughly thrice that of Q4.
At the same time, Hopper chip output is expected to come down to 1 million units in Q1 2025, from 1.5 million units in Q4 2024. Considering that Blackwell chips are priced 60%-70% higher than Hopper chips, Blackwell chip sales could outpace Hopper in Q1 2025, based on Moore’s calculations.
UBS Sees Solid Boost from NVDA’s Exports
UBS analyst Timothy Arcuri expects Nvidia to witness a solid boost from exports in Q3 FY25, as suggested by the Taiwan Ministry of Finance’s recent data. The data suggests stronger-than-expected demand for Nvidia’s data center products, even though September data for exports revealed a 25% month-over-month decline to $6.1 billion.
Nvidia’s Fiscal Q3 ends in October. Arcuri stated that considering a normal seasonal month for October, the company’s exports could stand roughly at $22.5 billion in Q3 FY25. The estimate shows a 21% quarter-over-quarter growth and is higher than UBS’ projection of a 15% jump in Nvidia’s data center revenues. Having said that, the five-star analyst did caution against relying too heavily on Taiwanese statistics due to significant variations in recent years.
Is Nvidia a Good Stock to Buy?
Wall Street remains bullish on Nvidia stock despite the 168.4% growth in share price already seen in the year-to-date period. On TipRanks, NVDA stock commands a Strong Buy consensus rating based on 39 Buys and three Hold ratings. Also, the average Nvidia price target of $152.44 implies 14.7% upside potential from current levels.
