Analysts Follow Our Lead With Nvidia Price Target Changes
Following some significant news on AI chip shipments to China, Mizuho and Needham revisited their Nvidia target prices.
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Let’s get caught up on some of the day’s happenings, which include a few Wall Street price target increases for some Portfolio holdings, an acquisition by Eaton ETN and a quick word on Marvell MRVL shares.
We’ll follow up with some thoughts on earnings from Morgan Stanley MS and Bank of America BAC and Wednesday's June PPI report.
Needham Ups Nvidia Price Target
On Tuesday, we upped our Nvidia NVDA price target to $200 from $185, given the expected return of AI chip shipments to China. On Wednesday, Needham is following our lead, boosting its price target to $200 from $160, and shared its view those H20 shipments could tally $3 billion per quarter starting in Nvidia’s October quarter. Mizuho also upped its NVDA target to $192 from $185 for the same reasons.
Mizuho also upgraded Palantir PLTR shares to Neutral, which means they have missed the tremendous move in PLTR shares since we added them to the Portfolio. Mizuho’s PLTR target of $135, up from $116, is also a bit in the rear view in our opinion. As it relates to our PLTR target, we are inclined to revisit it further in the coming weeks, especially if the company holds another AIPCon event.
Canaccord and Cantor Fitzgerald both increased their Meta META price targets to $850 and $828, respectively, from $825 and $807. We see last night’s top and bottom line beat by advertising firm Omnicom OMC as it points to advertising spend holding up much better than feared at the start of the June quarter. This should benefit Alphabet GOOGL and Meta and their advertising-led business models when they report their June quarters in the coming weeks.
Speaking of GOOGL shares, Needham also upped its price target for them to $210 from $178, while UBS lifted its to $192 from $186. Our target remains at $200 for now.
Cantor Fitzgerald also lifted its price target on ServiceNow NOW to $1,200 from $1,048, given its findings that AI adoption is accelerating. The current share price level for NOW has landed it on our shopping list, where it joins TJX TJX, SuRo Capital SSSS and a few others.
Eaton Picks Up Resilient Power Systems
On Wednesday morning, we learned Eaton Corp. signed an agreement to acquire Resilient Power Systems, a North American developer and manufacturer of innovative energy solutions, including solid-state, transformer-based technology. Applications include data center and energy storage, and in our view, this should bolster Eaton’s ability to address those markets and the energy demand they are creating.
We continue to like how ETN shares help the Portfolio address the energy pain point we are increasingly reading and hearing about. Given the extended timetable to address that pain point, we are inclined to be patient, long-term owners of ETN.
What’s Up With Marvell? TSM Earnings on Deck
We are seeing the shares of Marvell under some pressure on Wednesday on no new developments, which likely means we are once again seeing folks react to all the Nvidia-related news of the last 24 hours. As we’ve discussed before, we see the rising tide of AI and data center chip demand benefitting more than just Nvidia, especially as Amazon AMZN, Alphabet, Microsoft MSFT and Meta pursue custom AI chip strategies with Marvell. In other words, the AI headlines of the last few days, including those from Tuesday's event in Pennsylvania, Meta’s data center announcements and others, reaffirm our positive stance on MRVL shares.
On Thursday morning, when we review quarterly results and guidance from Taiwan Semiconductor TSM, its comments about AI and data center chip demand will be a key focal point for us as we match it up against expectations for Nvidia and Marvell. We suspect that guidance will support our MRVL and NVDA targets at $115 and $200, respectively, but based on the insight we garner from TSM, we’ll revisit those as needed.
We’ll also be following TSM’s guidance for connected devices, including PC and smartphones, tying it back to our Positions in Apple AAPL, Qualcomm QCOM and Universal Display OLED.
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At the time of publication, TheStreet Pro Portfolio was long ETN, MRVL, MS, BAC, NVDA, PLTR, META, GOOGL, NOW, TJX, SSSS, AMZN, MSFT, AAPL, QCOM and OLED.
