'Godfather Of AI' Jensen Huang And Nvidia Will Offer Bullish Outlook To Fuel Tech Rally 'Into Rest Of Year,' Says Analyst

Nvidia Corp.'s NVDA second-quarter earnings report is the closely-watched tech event of the week, according to Wedbush analyst Daniel Ives.

Key To Market Recovery: “This is one of the most important earnings weeks of the year with the ‘Godfather of AI’ CEO Jensen Huang and Nvidia set to report its highly anticipated earnings on Wednesday after the bell,” said Ives in a note on Monday.

Against the backdrop of a shaky tech market following the second-quarter results, the Street will be laser-focused on Nvidia's guidance and Huang's commentary to gain insights into true demand and growth trajectory of the AI revolution into the year-end and 2024, the analyst said.

“We expect a bullish outlook from Nvidia that should be the fuel in the engine to continue this tech rally into the rest of the year despite the tough-talking Fed with Jackson Hole/ Powell speech around the corner,” Ives said.

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Biggest AI Beneficiary: There has been a massive demand for AI use cases across the board, “which is benefitting the only AI game in town – Nvidia,” Ives said, citing Wedbush's Asia checks and the rest of the firm's tech team.

Wednesday's earnings report, according to the analyst, will be “another clear sign from Nvidia with robust guidance that enterprise demand is skyrocketing for AI buildouts and will be key data points that further validate our tech bull thesis playing out into 2024.”

The buildout is unlike anything that was seen since the Internet in 1995 and its ramifications are just starting to ripple through the consumer/enterprise landscape, Ives said.

“With the Fed starting to wave the white flag on rate hikes (cuts likely in 2024), we see a green light risk-on environment into year-end and believe we are only in the halftime of this new tech bull market raging into the next 12 to 18 months.”

The Technology Select Sector SPDR Fund XLK rose 0.45% to $165.71 in premarket trading on Monday and Nvidia climbed 1.73% to $440.50, according to Benzinga Pro data.

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Photo courtesy: Nvidia Corp on Flickr