There Could Be 18% Upside Left In Nvidia, Analyst Says

NVIDIA Corporation NVDA stock is up 1,760 percent in the past five years, but at least one Wall Street analyst says there’s even more upside ahead.

The Analyst

Canacord Genuity analyst Matthew Ramsay maintains a Buy rating for Nvidia stock and has raised his price target from $225 to $250.

The Thesis

After meeting with Nvidia management at the Supercomputing Conference in Denver, Ramsay said he’s even more confident about Nvidia’s prime positioning in key secular artificial intelligence growth markets. According to Ramsay, Nvidia has plenty of bullish catalysts ahead in 2018.

“In fact, as applications of highly parallel GPU computing expand and developer tools and AI algorithms mature, our positive thesis continues to play out with strong gaming GPU growth expected to continue in Q4/F’18 with the Pascal gaming and Volta datacenter (including Inference) ramps and we believe new trends including deep learning, virtual/augmented reality, and autonomous driving will catalyze new market growth longer-term,” Ramsay said.

Despite all the exciting opportunities, Ramsay said the company’s data center business accounted for 80 percent of the conversation at the conference. Ramsay says if Nvidia captures only half of an accelerated computing market that is half the size of the one Nvidia expects to develop by 2020, it could trigger exceptional revenue growth for the company.

In the autonomous vehicle market, Ramsay projects Level IV and Level V vehicles will contain at least $1,000 of Nvidia content each by 2020.