Loop Capital reiterated its Buy rating on NVIDIA (NASDAQ:NVDA), maintaining a price target of $175.00. The firm stands by its positive stance as NVIDIA gears up to announce its July quarter earnings per share (EPS) this Wednesday, August 28. Despite acknowledging the delay in the release of NVIDIA's Blackwell architecture, Loop Capital believes that the delay, now projected to be around 120 days instead of the initially anticipated 90, will have limited impact on the company's prospects.
The analyst pointed out that the improved yield rates of NVIDIA's Hopper products from TSMC are a positive sign. Additionally, the expected increase in Hopper production throughout the fall is likely to compensate for the delayed Blackwell production. The firm suggests that while there may be a shift in average selling price (ASP) due to a higher mix of Hopper products in the first half of the calendar year 2025 and fiscal year 2026, the overall outlook for NVIDIA remains strong.
Loop Capital's price target is based on a 29 to 35 times multiple of the $5.00 to $6.00 EPS that NVIDIA is projected to generate in the calendar year 2025 and fiscal year 2026. The firm's confidence in NVIDIA is underlined by the potential upside it sees compared to the Street's expectations, despite the setback with Blackwell.
The firm's analysis indicates that the longer delay for Blackwell, initially reported on August 5, is manageable within the broader context of NVIDIA's production and yield improvements. Loop Capital's continued endorsement of a Buy rating reflects its belief in NVIDIA's ability to navigate current challenges and capitalize on its production capabilities.
Investors and market watchers are now looking forward to NVIDIA's upcoming earnings report to gauge the company's performance and future outlook, especially in light of the recent developments around its product timelines and production strategies.
NVIDIA is anticipated to report strong second-quarter earnings, with revenue projected to rise by 112% to $28.68 billion. The third quarter is also expected to witness a 75% increase in revenue, amounting to $31.69 billion. Despite potential production delays for the next-generation Blackwell AI chips, demand for NVIDIA's high-performance graphics processing units remains high.
Analysts from Morgan Stanley (NYSE:MS) maintain an Overweight rating on NVIDIA shares, reflecting confidence in the company's ability to navigate through challenges without losing its growth momentum. Similarly, Citi and Melius have reiterated a Buy rating on the stock.
Evercore ISI has increased its price target on NVIDIA shares, indicating a positive outlook based on the company's robust market position driven by AI. The firm projects NVIDIA to achieve more than $10 in earnings per share by 2030.
Investors are also awaiting updates on NVIDIA's AI processors tailored for the Chinese market, where sales of its most advanced chips are restricted by U.S. regulations.
These developments highlight NVIDIA's resilience and continued growth in the face of various challenges, including export controls in China, difficulties in launching powered data centers, and potential delays in new product releases.
InvestingPro Insights
As NVIDIA (NASDAQ:NVDA) approaches its earnings report, current metrics from InvestingPro offer a snapshot of the company's financial health and market position. NVIDIA boasts a robust revenue growth of 208.27% over the last twelve months as of Q1 2025, with an even more impressive quarterly revenue growth of 262.12% in Q1 2025. This indicates a significant expansion in NVIDIA's business, aligning with Loop Capital's positive outlook.
InvestingPro Tips highlight NVIDIA's perfect Piotroski Score of 9, which suggests strong financial health, and analysts' anticipation of sales growth in the current year, reinforcing the company's potential for continued success. Furthermore, NVIDIA has maintained dividend payments for 13 consecutive years, showcasing its commitment to shareholder returns. For investors seeking a deeper analysis, there are 20 additional InvestingPro Tips available on NVIDIA, which can be found on the InvestingPro platform.
With a market capitalization of $3.18 trillion USD and a high P/E ratio of 75.12, NVIDIA is trading at a premium, reflecting its status as a prominent player in the Semiconductors & Semiconductor Equipment industry. These financials should be considered by investors ahead of the earnings report to better understand the company's market valuation and growth prospects.
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