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NVIDIA shares gain as TD Cowen raises price target

EditorAhmed Abdulazez Abdulkadir
Published 06/10/2024, 01:22 PM
© Reuters

On Monday, NVIDIA Corporation (NASDAQ:NVDA) saw its price target increased by TD Cowen to $140.00, up from the previous $120.00, while the firm maintained a Buy rating on the stock. The adjustment comes in response to NVIDIA's recently completed 10:1 stock split and a review of the company's long-term datacenter business model.

The revised price target reflects the updated earnings per share (EPS) estimates that now account for the stock split. TD Cowen's analysis also includes insights from their comprehensive report titled "The Next Datacenter Decade," which explores the future framework of datacenter operations.

In a statement, the analyst from TD Cowen noted, "We adjust our EPS estimates/PT to align with the now-effective 10:1 stock split, and align our long-term datacenter model with the framework recently published in our Ahead of the Curve deep dive." The firm reiterates its Buy rating on NVIDIA, citing it as a "Best Idea" and highlighting their confidence in the stock by raising the price target.

The price target increase is a reflection of the firm's calculations and confidence in NVIDIA's continued growth, particularly in the datacenter sector, which is expected to expand over the next decade. NVIDIA's stock split, which is now effective, has been factored into the firm's financial models, ensuring that their projections remain relevant and up-to-date.

Investors and market watchers will likely monitor NVIDIA's stock performance closely following this updated guidance from TD Cowen, as price target changes by prominent analysts can influence market perceptions and investment decisions.

In other recent news, Nvidia, a leading artificial intelligence company, has undergone a 10-for-1 stock split, leading to discussions about the company's potential inclusion in the Dow Jones Industrial Average.

This move, which increases the number of outstanding shares, has sparked comments from global markets strategist Ben Laidler at eToro, who suggested that Nvidia could join Amazon (NASDAQ:AMZN) and Apple (NASDAQ:AAPL) in the Dow. On the other hand, Goldman Sachs strategists, including David Kostin, noted that recent stock splits, such as Nvidia's, did not significantly boost retail trading activity.

Simultaneously, Nvidia's shares have seen adjustments in their price targets. Susquehanna raised its price target to $1,450, while Cantor Fitzgerald and Barclays set new targets at $140 and $145, respectively. These changes reflect confidence in Nvidia's ability to capitalize on the growing demand for artificial intelligence technologies.

In regulatory news, the US Department of Justice and the Federal Trade Commission are scrutinizing the AI industry, focusing on Nvidia, OpenAI, and Microsoft (NASDAQ:MSFT). This could potentially lead to investigations into these companies' business practices. Lastly, investors have placed significant short bets against Nvidia, reaching approximately $34 billion, according to S3 Partners.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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