Why Vicor Shares Are Higher Today

Vicor Corp VICR shares are trading higher by over 5% as Needham & Co. analyst N. Quinn Bolton raised the price target to $65.00 from $55.00 at a Buy rating. 

The analyst is bullish on the company's near-term performance and long-term prospects post the Annual Shareholder Meeting last Friday.

Bolton is confident that Vicor will benefit from higher demand for AI processors/XPUs, given the company's significant demand acceleration for AI systems/projects over the last three months led by ChatGPT.

Also, the analyst believes the recent upside in NVIDIA Corporation NVDA A100/A800 GPU demand should drive Vicor growth in the near term.

Bolton thinks some XPU customers will launch new SKUs of new or existing platforms and higher-performance systems based on Vicor's Factorized Power architecture in the coming one to two years.

Bolton sees management's tone related to winning designs in the current generation and next-generation XPUs positively improved. 

The analyst thinks Vicor is well placed to deliver 48V Factorized Power solutions for custom-designed AI processors created by leading hyperscalers in the next couple of years. 

Bolton estimates revenue of $393.8 million in 2023 and $450.0 million in 2024, with an operating margin of 12.8% in 2023 and 18.5% in 2024. 

The analyst projects an EPS of $1.10 in 2023 and $1.60 in 2024. 

Price Action: VICR shares are up 6.18% at $56.35 on the last check Monday.