Nvidia A Strong Buy With 42% Upside, Says Analyst Predicting ‘Positive Report And Outlook’ Ahead Of Earnings Buy Nvidia Stock Ahead Of Its Upcoming Earnings, Suggests Evercore ISI. Predicts 'A Positive Report And Outlook.' - NVIDIA (NASDAQ:NVDA)

In the lead-up to Nvidia Inc.’s NVDA forthcoming earnings report after market close on Feb.26, Evercore ISI suggests that it is a good buying opportunity amid strong fundamentals.

What Happened: In a client note on Sunday, analyst Mark Lipacis and his team at Evercore ISI added the chip giant to its ‘tactical outperform’ list. The firm has a $190 price target on the stock with a ‘Buy’ rating, suggesting an upside of nearly 42% from yesterday’s close, CNBC reported.

Analysts at Evercore ISI stated that the worries about demand for Nvidia's microchips and processors following the DeepSeek launch are exaggerated and that the company is likely to deliver "a positive report and outlook” in its upcoming fourth-quarter earnings. It considers the DeepSeek-led sell-off as a significant buying opportunity for Nvidia stock.

Evercore analysts stated that the industry continues to believe in Nvidia’s software innovations, including NIMS and NeMo. These innovations will sustain the demand for its GPUs by providing enterprises with flexibility across cloud providers and on-premises deployments while simplifying the development and deployment of Large Language Models (LLMs).

Additionally, advancements like LiquidAI, which enable model training during inference, highlight the importance of programmable platforms such as Nvidia’s GPUs.

Why It Matters: This recommendation comes days after Nvidia saw a $600 billion sell-off in a single day, triggered by the release of a new Large Language Model (LLM) by DeepSeek operating on older-generation Nvidia chips. This development has raised questions about the future of AI technology and Nvidia’s role in it.

To add to this, reports of OpenAI developing custom chips in-house to move away from Nvidia present a fresh challenge for the chip giant.

"Longer term, we view the risk of custom-AI chips taking share as the biggest risk, however, the recent checks suggest that this risk is nominal, at least in the near-term," clarified Mark Lipacis and team.

Besides Evercore ISI, Morgan Stanley maintained this stance on Nvidia being in the list of its “Top Pick,” last week. While the firm acknowledged that DeepSeek presented near-term headwinds, its long-term outlook for Nvidia remained intact. The analysts at Morgan Stanley also noted that stabilizing demand for Nvidia’s Hopper chips and improved supply of Blackwell would be favorable for the company.

According to ratings from 40 analysts, tracked by Benzinga Pro. NVIDIA Corp has a consensus price target of $172.28. However, the latest forecasts from Morgan Stanley, Tigress Financial, and Cantor Fitzgerald place the average price target at $190.67, suggesting a potential 42.93% upside for the stock.