Needham & Company Upgrades NVIDIA (NVDA) to Buy; The Only Open-Ended Growth Story in Semis
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Needham & Company upgraded NVIDIA (NASDAQ: NVDA) from Hold to Buy with a price target of $100.00, calling it the only open-ended growth story in Semis.
Analyst Rajvindra Gill commented, "We upgrade NVDA to Buy and establish a $100 PT post a significant beat and raise quarter. While NVDA reacted positively on Friday (up ~30% vs flat S&P500), we still see considerable upside as NVDA targets expanding markets. Our upgrade is principally based on long-term secular trends: 1) incorporation of ADAS applications in automotive market (25MM+ cars by 2019) and where NVDA's Drive PX2 supplies Level 3-5 autonomy (~$6B TAM); 2) proliferation of machine learning, AI and graphics virtualization in the data center; and 3) emergence of virtual reality devices in PC and gaming mkts driving higher graphics content. We believe NVDA can generate a base case of $3.10 of earnings power in FY18, and we have formulated a bull case scenario of $3.70-4.00 and $5-6 of long-term earnings power driven by the inflection of ADAS adoption."
Shares of NVIDIA closed at $87.97 yesterday.
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Related EntitiesNeedham & Company, Standard & Poor's, Earnings
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