Wolfe Research Raises NVIDIA (NVDA) Price Target to $150 per Share by 2025
In a recent note, renowned investment firm Wolfe Research has increased their price target for NVIDIA (NVDA) to $150 per share by 2025. This decision comes after positive supply chain checks revealed strong growth potential for the company in the upcoming calendar year.
The report from Wolfe Research indicates a promising path to 50%+ content growth for NVDA GPUs in 2025, driven by the transition to Nvidia's new Blackwell platform. This shift is expected to result in better average selling prices (ASPs) and an improved product mix.
Furthermore, there is potential for significant unit growth, with early indicators suggesting a 50% increase in GPU units for 2025. While Wolfe Research remains cautious in their current estimates, they recognize the possibility of this figure providing additional upside to their projections.
The report highlights Nvidia's data center business as a key driver of growth, with expected at least 50% growth in 2025. This growth is fueled by factors such as cloud service providers adopting Blackwell, improved allocations for enterprises, and the emergence of new revenue streams from "Sovereign AI."
Additionally, Wolfe Research expects GB200 adoption to drive higher NVDA networking attach rates for both InfiniBand and NVDA Spectrum-X solutions, indicating growth in Nvidia's networking portfolio essential for maximizing AI cluster performance.
Based on their revised estimates, Wolfe Research projects Nvidia's FY26 revenue to reach $177.0 billion and EPS to be $4.03. Their new $150 price target reflects a valuation of approximately 37x their FY26 EPS, aligning with Nvidia's historical average.
Wolfe Research maintains their Outperform rating for Nvidia, impressed by the company's earnings momentum and long-term potential in AI. They emphasize Nvidia's strong position by highlighting its significant outperformance compared to broader markets and peers in the semiconductor space.
Analysis:
This article highlights Wolfe Research's optimistic outlook on Nvidia's growth potential, particularly in the data center business and GPU units. The increased price target reflects confidence in Nvidia's ability to capitalize on new platforms and technologies, leading to substantial revenue and earnings growth. For investors, this signals a promising opportunity to consider investing in Nvidia stock for potential long-term gains.