Nvidia (NASDAQ:NVDA) will announce its first-quarter financials on Wednesday, May 24. Analysts maintain a bullish outlook on NVDA stock ahead of the Q1 print, reflecting positive momentum in the Data Center and Gaming businesses and its dominant positioning in the AI (Artificial Intelligence) space.
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In a note to investors dated May 10, Hans Mosesmann of Rosenblatt Securities said he expects the company to meet or exceed Q1 expectations.
Analysts expect Nvidia to post a top line of $6.52 billion, which is within the management’s projected guidance range. While it reflects a decline from the year-ago quarter, it indicates a sequential improvement in revenue from the previous quarter.
During the Q4 conference, Nvidia said that growth across its target markets and strength in the Data Center and Gaming segments could lead to a sequential improvement in sales in Q1.
Mosesmann is bullish about NVDA and lauds the company’s competitive positioning in the AI space.
Along with Mosesmann, Truist Financial analyst William Stein is also upbeat about NVDA’s Q1 performance. On May 10, the analyst said that he expects the company to benefit from the higher demand for AI GPUs (Graphics Processing Units).
Echoing similar sentiments, Susquehanna analyst Christopher Rolland maintained a Buy recommendation on NVDA stock. Rolland expects better Q1 results and robust guidance from the company due to Data Center demand, recovery in Gaming, and the “ongoing AI gold rush.”
Furthermore, the analyst expects NVDA’s margins to remain strong, led by strength in the Data Center segment and higher prices for GPUs.
Thanks to the improvement in sales and strong margins, analysts expect Nvidia to mark a sequential increase in its bottom line in Q1. Wall Street analysts expect NVDA to report earnings of $0.92 per share in Q1, compared to $0.88 per share in Q4. However, earnings are likely to decline on a year-over-year basis due to the tough year-over-year comparisons.
What’s the Prediction for NVDA Stock?
NVDA stock has skyrocketed and gained about 114% year-to-date due to the popularity of OpenAI’s ChatGPT), the AI rush, and NVDA’s dominant positioning in the AI space that allows it to benefit from the developments in generative AI.
The stock has received 29 Buy and eight Hold recommendations, reflecting a Strong Buy consensus rating ahead of Q1 earnings results. However, as NVDA stock has gained quite a lot, analysts’ average price target of $296.29 implies 5.23% downside potential.
