Nvidia To Bask In Glory Of ChatGPT Wave, Analyst Says Ahead Of 4Q; Boosts Price Target By Over 27%

KeyBanc analyst John Vinh maintained NVIDIA Corp NVDA with an Overweight and raised the price target from $220 to $280.
NVDA will report its 4Q on February 22.
The Street optimism reflected the commercialization of ChatGPT, a higher focus on AI workloads from the cloud and enterprises, and new gaming (RTX40) and data center (Hopper) product ramps.
However, the analyst expects NVDA to lower its data center outlook given slowing cloud Capex at Meta Platforms Inc META, Amazon.Com Inc AMZN AWS, and Alphabet Inc GOOGL and a pause in China data center demand related to the recently introduced export controls.
Vinh's cloud tracker results also indicated a near-term pause in NVDA deployments as customers transition to Hopper.
However, the analyst saw sustained outsized data center growth driven by increasing industry adoption of AI workloads, enhanced by generative AI workloads (i.e., ChatGPT, Bard).
Vinh believes the launch of RTX40 is off to a good start as demand for the 4090 remains very strong, while the sell-through of the 4080 is solid.
However, residual excess RTX30 inventory and China reopening headwinds will likely push out expectations for recovery.
Price Action: NVDA shares traded lower by 3.60% at $212.10 on the last check Friday.