After earnings sell-off, Nvidia stock regains $180
- NVDA recovers from post-earnings pullback on Thursday.
- Nvidia stock hit intraday low in $176s before regaining $180.
- Initial reactions disliked the small miss on Data Center revenue.
- Wall Street analysts, however, moved their price targets mostly above $200.
Despite sinking as much as 5.8% when it released its fiscal second-quarter results late Wednesday, Nvidia's (NVDA) share price has been recovering steadily on Thursday. After lunchtime in New York, NVDA stock made its way from an intraday low of $176.41 in the morning to above $180 by mid-afternoon.
The bearish sentiment stems from data center revenues that slightly underperformed expectations, but Wall Street analysts issued a slate of price target hikes to soothe the burn.
The wide market, which had been complacent this week in the run-up to Nvidia earnings, is cautiously rising. The Dow Jones Industrial Average (DJIA) is barely green, while the NASDAQ Composite advances 0.5%.
Nvidia stock receives volley of rising price targets
While Nvidia beat the consensus estimates for earnings and revenue in Q2, some observers thought it wasn't enough. In particular, the company's Data Center segment reported sales of $41.1 billion compared with analyst estimates for $41.3 billion, rising just 5% QoQ. What's more, Nvidia's gross margin fell 300 basis points to 72.7% in Q2.
While some critics said the figure showed that the AI revolution was slowing down its meteoric rise, others simply blamed it on the Trump administration's temporary halt to H20 shipments to China that would disappear in future quarters.
Others pointed to the fact that three customers — presumably Microsoft (MSFT), Alphabet (GOOGL) and Amazon (AMZN) — now represent 23%, 19% and 14% of accounts receivable or 56%, up from just two customers at 17% and 16% at the start of the year. The worry is that if these hyperscalers pull back at all, Nvidia's rapid sales growth will stall immediately.
Wall Street hasn't met the print with much negativity, however. Most analysts suggested the 56% overall rise in YoY revenue demonstrated that the company is still soaked in red-hot demand for its products. Additionally, the Networking segment saw sales rise 98% YoY, and the Automotive division has sales advanced 69% in that time period.
Here were the major price target changes on Wall Street:
- JPMorgan raises target price to $215 from $170
- Rosenblatt raises target price to $215 from $200
- Benchmark raises target price to $220 from $190
- BofA Securities raises target price to $235 from $220
- Citi raises target price to $215 from $170
- Jefferies raises target price to $205 from $200
- KeyBanc raises target price to $230 from $215
- DA Davidson raises target price to $195 from $135
- Truist Securities raises target price to $228 from $210
Nvidia stock chart
With those price targets in mind, it would appear that bulls might expect this long rally that has paused over the past month to pick back up. The top trendline that began in March 2024 suggests that resistance won't kick in until NVDA moves above $200 and maybe not until $210.
At just 57, the Relative Strength Index (RSI) shows momentum in waiting. NVDA just needs to close above $184 in order to entice the bulls into another leg up.
The 50-day Simple Moving Average (SMA) in yellow on the daily chart below implies support near $170, and the January high, lower down near $153, could also turn into support.
NVDA daily stock chart
Author
Clay Webster
FXStreet
Clay Webster grew up in the US outside Buffalo, New York and Lancaster, Pennsylvania. He began investing after college following the 2008 financial crisis.
