NVIDIA (NVDA) Margins Could Track Higher – RBC Capital

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RBC Capital analysts maintained their Outperform rating on NVIDIA (NASDAQ: NVDA) and raised their price target to $20.00 (from $19.00) following the company’s strong earnings report. NVDA experienced share gains in GPU, fueled by impressive Kepler architecture. This segment is set to materially outpace unit growth rate in the PC market.

“As a result of ASPs in uplift in desktop and unit growth in notebook, we estimate NVDA’s GPU revenue growth rate to be +17% Y/Y in market where total PC units are only expected to grow 2.0%,” said analyst Dough Freedman.

“In addition, gross margins appear to be well-positioned to track higher as 28nm supply constraints alleviate and as PSB (highest margin segment) resumes a growth trajectory, likely helped by recent introduction of Kepler-based GPUs and rising Romley presence in Workstation,” he added.

For an analyst ratings summary and ratings history on NVIDIA click here. For more ratings news on NVIDIA click here.

Shares of NVIDIA closed at $14.71 yesterday, with a 52 week range of $11.47-$16.90.

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