Investing.com – As Nvidia (BVMF:) (: ) prepares to release its next earnings report, analysts at Wedbush and Raymond James reiterate their positive view on the company’s stock, even in the face of concerns that elevated expectations could cause volatility in the short-term market.
In a note to clients on Thursday, Wedbush highlighted that Nvidia has consistently exceeded forecasts, thanks to solid growth in AI investments from large customers, both in the hyperscale segment and beyond. This trend is expected to continue into the next fiscal year.
Wedbush Projects Nvidia will continue to beat expectations by about $2 billion in upcoming earnings reports. “We see no reason to change our constructive view on NVDA given our optimistic outlook for 2025,” said the company, which raised its price target from $138 to $160.
Raymond James shares this positive view, although he points out that supply challenges can limit immediate gains.
Raymond James noted that while demand remains strong, Nvidia’s stock is at its lowest level in four years, reflecting longer cycles and the complexity of the company’s new systems. This dynamic could limit initial shipments of Blackwell GPUs in the near term.
Despite this, the company believes that Blackwell GPU production is expected to gain momentum in the first half of 2025, fueled by growing demand for Nvidia’s Spectrum-X networking technology. As a result, Raymond James revised its price target from $140 to $170, noting that any near-term dip represents a buying opportunity.
Both companies point out that Nvidia’s growth through AI applications remains well-founded. Expanding spending in the hyperscale segment and growing demand for data centers are expected to continue to generate robust revenues through 2025.
Analysts remain confident, noting that despite possible near-term turbulence, Nvidia’s long-term fundamentals remain solid.
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How can investors mitigate risks associated with Nvidia’s stock volatility?
Time.news Editor: Welcome to our special segment today. We’re diving into the latest developments with Nvidia as they prepare to release their next earnings report. To shed light on the topic, we have Dr. Sarah Mitchell, a tech financial analyst with expertise in the semiconductor industry. Sarah, thank you for joining us!
Dr. Sarah Mitchell: Thank you for having me! I’m excited to discuss Nvidia and the broader implications for the tech sector.
Time.news Editor: Nvidia has certainly been a hot topic lately. With firms like Wedbush and Raymond James expressing optimism about the company’s stock, what do you think is driving their confidence?
Dr. Sarah Mitchell: Absolutely, it’s an interesting time for Nvidia. The key driving force behind their optimistic outlook is the substantial growth in AI investments from major consumers. Both Wedbush and Raymond James noted that Nvidia has a track record of surpassing earnings forecasts, which instills a lot of confidence in analysts and investors alike.
Time.news Editor: It’s fascinating how AI seems to be a pivotal part of their strategy. Can you elaborate on the sectors where this growth is occurring?
Dr. Sarah Mitchell: Certainly! Nvidia’s growth is particularly strong within the hyperscale segment, encompassing large cloud service providers. However, it’s not just limited to that. We’re seeing an uptick in demand from various industries looking to integrate AI capabilities—from automotive to healthcare. This breadth of application is what makes Nvidia’s position so robust.
Time.news Editor: Given this favorable outlook, are there any concerns investors should be aware of?
Dr. Sarah Mitchell: Yes, there are always risks in the market. While the positive sentiment is strong, there’s concern that Nvidia’s elevated stock expectations could lead to volatility in the short term. If their earnings report doesn’t meet the high expectations set by analysts, we could see sharp market reactions. This is particularly relevant for a stock that has seen substantial price shifts in recent months.
Time.news Editor: So it’s a double-edged sword—potentially rewarding but also risky. How should investors navigate this landscape?
Dr. Sarah Mitchell: Exactly. Investors should remain vigilant and consider their risk tolerance. It might be prudent to look at Nvidia’s long-term potential while being prepared for short-term fluctuations. Diversification could also help mitigate risks associated with volatility.
Time.news Editor: That’s wise advice. Before we wrap up, what should we be watching for in Nvidia’s upcoming earnings report that could indicate how their trajectory will unfold?
Dr. Sarah Mitchell: Great question! Key indicators to watch will include revenue growth from their data center and gaming segments, guidance for the upcoming quarters, and any mentions of new AI initiatives and partnerships. This will help gauge not just past performance, but also future potential.
Time.news Editor: Thank you, Dr. Mitchell. It looks like Nvidia is at an exciting juncture, and we appreciate your insights on this topic.
Dr. Sarah Mitchell: Thank you for having me! I’m looking forward to seeing how things develop with Nvidia.
Time.news Editor: Likewise! Stay tuned, everyone. We’ll continue to provide updates on key earnings reports and what they mean for investors.