Nvidia results show 'accelerated ... demand' as Rosenblatt sees 50% upside
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Nvidia's (NASDAQ:NVDA)
fourth-quarter results and guidance showed that the company is experiencing "sustained accelerated broad based demand," research firm Rosenblatt Securities wrote in a note to investors.
Analyst Hans Mosesmann noted that Nvidia's data center segment, which saw 72% year-over-year growth and had record revenue, is likely to keep benefiting from "training and inference for cloud computing and AI workloads." The analyst reiterated the firm's buy rating and $400 price target, implying roughly 50% upside from current levels.
"Nvidia continues to destroy the notion of an end of the semiconductor cycle and sets the stage for a secular dynamic that we see as never seen in the history of semiconductors," Mosesmann wrote in the note. "Hence, our continued view of this dynamic as the Mother of All Cycles."
Nvidia shares slipped in premarket trading, down nearly 2% to $260.31.
In addition, the analyst noted that Nvidia's management, led by Jensen Huang, said they expect supply to continue improving throughout fiscal 2023, which should set the company up for "strong growth," as demand for its GPUs in all segments, including data centers, gaming and automotive, continues.
"We continue to view Nvidia as the best-in-class AI play with several growth vectors on the horizon (Omniverse, next generation networking/DPU adoption, autonomous driving S/W kicker, etc.)," Mosesmann added.
On the company's earnings call, Nvidia's Huang said the company "gave it our best shot" to acquire Arm from Softbank (OTCPK:SFTBY), but ultimately, it called off the deal due to regulatory pressures around the world.