After a pullback a few months ago, Nvidia (NASDAQ: NVDA) stock has rediscovered its mojo. Since 6 September, it has surged from $101 to $135.
Wondering how high the share price can go in the medium term? Here’s a look at Wall Street analysts’ latest price targets for the US-listed growth stock, as well as my own.
Wall Street’s forecasts
The table below shows all the broker price forecasts I could find that have been published in the last two months.
Date
Firm
Price target ($)
11-Oct-2024
Goldman Sachs
150
10-Oct-2024
Morgan Stanley
150
8-Oct-2024
Cantor Fitzgerald
175
8-Oct-2024
UBS
150
5-Sep-2024
Bank of America
165
29-Aug-2024
Wedbush
138
29-Aug-2024
Piper Sandler
140
29-Aug-2024
Sanford C. Bernstein
155
29-Aug-2024
Benchmark
170
29-Aug-2024
DA Davidson
90
29-Aug-2024
JPMorgan Chase & Co.
155
29-Aug-2024
Craig Hallum
165
29-Aug-2024
Westpark Capital
165
29-Aug-2024
Mizuho
140
29-Aug-2024
Raymond James
140
29-Aug-2024
Robert W. Baird
150
29-Aug-2024
Rosenblatt Securities
200
29-Aug-2024
Wells Fargo
165
29-Aug-2024
Needham & Company LLC
145
27-Aug-2024
Truist Financial
145
26-Aug-2024
Loop Capital
175
23-Aug-2024
Evercore ISI
150
21-Aug-2024
HSBC
145
Out of all those price targets, the highest is from Rosenblatt Securities. Its target is $200, which is nearly 50% above the current share price!
The average figure, however, is a fair bit lower at $153. That’s still well above the current share price though, so it’s fair to say that analysts generally (but not universally) expect the stock to continue rising.
It’s worth noting here that analysts’ price forecasts (which are usually 12-month targets) should be taken with a pinch of salt. Often, they don’t come to fruition.
They’re still worth looking at, however. Not only can they provide a good idea of sentiment towards a stock but they can also help to identify potential mispricings in the market.
My own price target
As for my own medium-term target for Nvidia, it’s $158. I’ve calculated this using a simple earnings multiple strategy.
Next financial year (ending 31 January 2026), I expect Nvidia to generate earnings per share (EPS) of around $4.50. That’s more than 10% higher than the current consensus earnings forecast of $4.04. But I’ve heard a lot of tech industry experts say that they think the company’s earnings may actually come in around the $5 mark next financial year so I think it’s a fair estimate.
Now, it’s hard to know what kind of earnings multiple to apply to this company. But I believe a multiple of 35 is reasonable given the level of growth and innovation here. Applying this to my EPS forecast of $4.50 gives me a price target of $158. That’s about 17% above the current share price.
I’m expecting volatility
I’ll point out that I don’t expect Nvidia stock to rise up to my price target in a straight line. This is a very volatile stock and it could easily experience another 20% or 30% pullback before rising to $158.
Ultimately, there are many factors that can affect the share price here. Some that could send it down in the short term include new artificial intelligence (AI) chips from rivals, delays with its new chip platform Blackwell, lower demand from major customers, and weakening sentiment towards AI stocks.
Over the medium to long term, however, I expect the share price to climb higher, although this isn’t guaranteed. Given the expected growth of the AI industry, I reckon the company’s earnings will surge in the years ahead.
The post Here are analysts’ latest share price forecasts for Nvidia stock appeared first on The Motley Fool UK.
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Edward Sheldon has positions in Nvidia. The Motley Fool UK has recommended Nvidia. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.
