Wells Fargo Keeps NVIDIA (NVDA) At Underperform But Raises PT 79%

November 11, 2016 7:50 AM EST
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Price: $88.45 +0.92%

Rating Summary:
    23 Buy, 18 Hold, 2 Sell

Rating Trend: Up Up

Today's Overall Ratings:
    Up: 11 | Down: 31 | New: 42
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Wells Fargo analyst David Wong stuck to his guns and kept his Underperform rating on shares of NVIDIA (NASDAQ: NVDA) after the company reported revenues for the quarter of $2.004B on (up 40% sequentially, up 54% year over year), significantly above Nvidia’s original guidance range of $1.68 billion +/- 2%. Reported GAAP gross margin in the quarter increased to 59.0% from 57.8% in the prior quarter, above the midpoint Nvidia’s GAAP guidance for gross margin to be 57.8% +/- 50bps. GAAP EPS for the quarter of $0.83 was significantly above the consensus est of $0.56 and our $0.54 GAAP EPS est.

Discussing the segments, gaming and datacenter showed impressive growth and automotive contributed in the October quarter. The analyst's FY17 EPS estimate increases to $2.37 from
$1.77 and the analyst is raising his valuation range substantially, to $54-64 from $30-36, based on
~20-24x FY18 EPS of $2.67. That said, the stock price is above the new valuation range and the Underperform rating stays.

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 $67.77 yesterday.



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