Nvidia’s rosy forecast prompts higher price targets from analysts

Chip giant Nvidia’s latest revenue guidance topped Wall Street expectations, but its proposed Arm deal may have hit a snag.

  • NVIDIA Corp (Nasdaq: NVDA) share price reaches US$191.05 per share
  • It estimated that its third-quarter revenue could amount to US$6.8 billion
  • Talks over Nvidia’s potential purchase of a UK firm are taking longer than expected
  • Interested in trading Nvidia shares? Open an account with us to get started.

Nvidia stock price inches up

Shares of the world’s largest maker of artificial-intelligence chips for data centres and graphics chips for gamers rose 0.3% to trade at US$191.05 as of 21:35 SGT on Thursday.

California-based Nvidia’s latest results and guidance, announced on Wednesday, came in better than analysts anticipated.

However, its bid to buy British semiconductor technology firm Arm Ltd may face challenges. Investors are focusing on whether the proposed US$40 billion acquisition will withstand regulatory scrutiny and be completed by March 2022 as Nvidia had promised, Reuters reported.

About 34 analysts gave ‘buy’ or ‘overweight’ ratings on NVDA shares, five suggested ‘hold’, while two recommended ‘sell’ or ‘underweight’ as of Thursday morning, Wall Street Journal data showed. Their average target price was US$214.28.

Numerous analysts including JPMorgan, Credit Suisse, Cowen and Company, and Piper Sandler increased their target prices this week on Nvidia.

Why is Nvidia upbeat on the current quarter?

Amid red-hot demand, Nvidia’s revenue forecast for its third quarter has exceeded research teams’ expectations.

It estimated that third-quarter revenue could come in at around US$6.8 billion, plus or minus 2%. That beat analysts’ expectations of US$6.54 billion on average, according to Bloomberg data.

Revenue for its second quarter soared 68% to US$6.51 billion, similarly surpassing analysts’ predictions of US$6.33 billion, based on Refinitiv data.

Meanwhile, second-quarter adjusted profit was US$1.04 per share, above analyst estimates of US$1.01 per share.

Nvidia CEO Jensen Huang flagged that chip demand could outstrip supply ‘for some time’, although ‘the good news is we’ve secured enough supply to meet our growth targets’.

What’s your view on Nvidia? Take a position on the stock today

Trade over 16,000 international shares on leverage and Singapore share CFDs from just 0.1% commission with our award-winning platform.* Try CFDs on share trading risk-free with a demo account.

*Based on the Investment Trends 2018 Singapore CFD & FX Report based on a survey of over 4,500 traders and investors. Awarded the Best Online Trading Platform by Influential Brands in 2020

US$40 billion Arm acquisition: Will it go through?

On Wednesday, Nvidia disclosed that talks with regulators to clear its planned purchase of Arm were taking longer than expected, and some Arm licensees had expressed concerns or objected.

However, Colette Kress, Nvidia’s chief financial officer, said the company remained confident the deal would close. She added that ‘regulators should recognise the benefits of the acquisition to Arm, its licensees, and the industry’.

Nvidia last year agreed to acquire the British firm from Japan’s SoftBank Group. Purchasing Arm will give Nvidia access to chip designs used by the world’s largest technology companies.

US financial services firm Edward Jones’ analysts noted: ‘Many investors already place a low probability on the deal ultimately being approved. If it is blocked, I think it will be met with a collective shrug.’

IGA, may distribute information/research produced by its respective foreign affiliates within the IG Group of companies pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the research is distributed in Singapore to a person who is not an Accredited Investor, Expert Investor or an Institutional Investor, IGA accepts legal responsibility for the contents of the report to such persons only to the extent required by law. Singapore recipients should contact IGA at 6390 5118 for matters arising from, or in connection with the information distributed.

The information/research herein is prepared by IG Asia Pte Ltd (IGA) and its foreign affiliated companies (collectively known as the IG Group) and is intended for general circulation only. It does not take into account the specific investment objectives, financial situation, or particular needs of any particular person. You should take into account your specific investment objectives, financial situation, and particular needs before making a commitment to trade, including seeking advice from an independent financial adviser regarding the suitability of the investment, under a separate engagement, as you deem fit.

Please see important Research Disclaimer.

Live prices on most popular markets

  • Forex
  • Shares
  • Indices

Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 15 mins.


Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 20 mins.

The Momentum Report

Get the week’s momentum report sent directly to your inbox every Monday for FREE. The Week Ahead gives you a full calendar of upcoming key events to monitor in the coming week, as well as commentary and insight from our expert analysts on the major indices to watch.

For more info on how we might use your data, see our privacy notice and access policy and privacy webpage.

You might be interested in…

Find out what charges your trades could incur with our transparent fee structure.

Discover why so many clients choose us, and what makes us a world-leading provider of CFDs.

Stay on top of upcoming market-moving events with our customisable economic calendar.