Why is Nvidia rising again?
Nvidia shares burgeoned nearly 8% on Tuesday, reversing massive losses suffered the previous day.
- Nvidia Corp (NASDAQ: NVDA) share price closed 8% higher on Tuesday (09 March)
- This was a reverse of the previous day, when shares had declined 7%
- Nvidia’s rally came on the back of falling US bond yields, which had hit a 14-month high just a day prior
- Analysts predict that the stock’s price could rally another 19% in the next twelve months
- Trade NVDA shares, long or short, with an IG account
Nvidia share price: what’s the latest?
Shares of Nvidia Corporation spiked up 8% to close at US$501 on Tuesday (09 March 2021), erasing the losses suffered a day earlier.
On Monday, Nvidia’s share price plunged nearly 7%, after US bond yields hit a 14-month daily peak rate of 1.59%.
On Tuesday, the daily 10-year Treasury Yield fell to 1.55%, which motivated investors to move back into technology stocks, evident by the Nasdaq Composite Index’s 3.7% increase for the session.
Nvidia shares are down 4.5% year to date, as of Tuesday close.
Where do analysts see Nvidia shares going next?
Bank of America analyst Vivek Arya wrote in a note on Monday (08 March) that his firm’s monthly Steam graphics processing unit (GPU) survey revealed a ‘robust gaming environment’ with the potential for more GPU upgrades.
The survey showed that only 11% of Nvidia gamers currently own a GPU with performance that can rival the latest consoles from Sony and Microsoft. As such, Arya predicts that there will be accelerated adoption of new generation GPUs from Nvidia.
The analyst has reiterated a ‘buy’ recommendation on the semiconductor stock.
Meanwhile, Jefferies analyst Mark Lipacis believes that Nvidia’s high gaming GPU revenue, which has coincided with a material increase in cryptocurrency prices, could pose risks to the company’s gaming GPU revenues and stock prices down the road.
However, he noted that M Science purchase data suggests that retail crypto miners are not behind the large gaming GPU revenues, unlike 2017’s ‘crypto-bubble’.
Instead, Lipacis attributes Nvidia's recent gaming GPU shipments to its Ampere GPU product cycle. He rated the stock a ‘buy’ with a US$680 price target on 03 March.
Across the board, MarketBeat data shows that NVDA has received a consensus stock rating of ‘buy’, and 12-month price target of US$594.31, which represents an upside of 18.6%.
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