Investment Manager's Insider Advice: Buy Nvidia Stock Now Despite Blackwell Delays
Evercore ISI analysts are bullish on Nvidia (NASDAQ:) ahead of their earnings report, dismissing concerns over Blackwell delays as "overdone." Demand for Nvidia systems is strong, with a 20% quarter-on-quarter surge in hyperscale capital expenditure (CapEx) in Q2 2024. Looking ahead, CapEx is expected to grow 8% and 10% in Q3 and Q4, respectively.
While recent reports hinted at a possible delay in Nvidia's Blackwell system, previous product disruptions have shown that the company can swiftly develop alternative solutions. Analysts believe that even if Blackwell is delayed, strong demand from Tier 2 and 3 Cloud Service Providers (CSPs) and enterprises would drive sales of current generation Hopper solutions.
With peak CapEx forecasted for Q4 2025 and Nvidia's current P/E at 39, analysts do not anticipate a significant sell-off before mid-2025. Evercore continues to view Nvidia as its "Top Tectonic Shift in Computing pick," capable of capturing up to 80% of the value in the parallel processing era. They predict Nvidia could reach over $10 of earnings per share (EPS) power by 2030 and potentially grow to be a 10-15% weighting in the .
In the near term, Evercore raises its third-quarter and 2024 estimates for Nvidia and increases its target price on the stock from $145 to $150. This analysis suggests that Nvidia remains a strong investment opportunity with potential for significant growth and value creation in the coming years.