Market Overview

Cowen Models 30% Upside In Nvidia

Share:
Cowen Models 30% Upside In Nvidia
Related NVDA
Nvidia Q3 Earnings Preview: Analysts Forecast Data Center, Gaming, Automotive Performance
Upcoming Earnings: Tech Giant Nvidia To Report Q3 Results Tomorrow
Notable earnings after Thursday's close (Seeking Alpha)

Cowen started coverage of Nvidia (NASDAQ: NVDA) with a bullish note, saying the company's auto computing business is about to reach a positive turning point.

The Analyst

Analyst Matthew Ramsay initiated coverage of Nvidia with an Outperform rating and $325 price target. Ramsey also initiated coverage of four other semiconductor stocks with Outperform ratings: Advanced Micro Devices Inc (NYSE: AMD), Ambarella Inc (NASDAQ: AMBA), Monolithic Power Systems Inc (NASDAQ: MPWR), and Broadcom (NASDAQ: AVGO).

The Thesis

Although investors primarily focus on Nvidia's data center, gaming and crypto businesses, the company's auto computing division is about to start delivering "high margin growth," Ramsay said in a Thursday note.

Nvidia has an unparalleled "breadth of solutions and partnerships" when it comes to providing chips for "end-to-end autonomous driving solutions," the analyst said.

Among the unique attributes Nvidia provides in the autonomous driving space are its processing system, which works well with AI, and its unmatched autonomous driving simulation product, Ramsay said. The company has created an "ecosystem" of top partnerships in the autonomous driving space, he said. 

By 2022, Cowen projects that robotaxis could generate more than $2 billion of new revenue for Nvidia, representing a tripling of the analyst's above-consensus 2020 estimate.

Nvidia's data center business can grow rapidly and potentially exceed Cowen's above-consensus 2020 revenue estimate of about $6 billion, Ramsay said. And the company's gaming business has plenty of room to grow, since only about 32 percent of its customers have its most advanced chip, the analyst said. 

Price Action

Nvidia shares were up 1 percent at the time of publication Friday at $250.18. 

Related Links: 

Cowen Names 4 Top Semi Picks: AMD, Ambarella, Broadcom, Monolithic Power

Wall Street Reacts To Nvidia's Quarter 

Latest Ratings for NVDA

DateFirmActionFromTo
Nov 2018B. Riley FBRMaintainsBuyBuy
Nov 2018SusquehannaUpgradesNeutralPositive
Nov 2018CitigroupMaintainsBuyBuy

View More Analyst Ratings for NVDA
View the Latest Analyst Ratings

Posted-In: Cowen Matthew RamsayAnalyst Color Price Target Initiation Analyst Ratings Best of Benzinga

 

Related Articles (AMD + AMBA)

View Comments and Join the Discussion!

Latest Ratings

StockFirmActionPT
AMTDMorgan StanleyUpgrades65.0
APOMorgan StanleyDowngrades34.0
ARMKBairdUpgrades44.0
CGMorgan StanleyDowngrades23.0
EIXEdward JonesDowngrades0.0
View the Latest Analytics Ratings
Don't Miss Out!
Join Our Newsletter
Subscribe to:
Market in 5 Minutes
Everything you need to know about the market - quick & easy.
Daily Analyst Rating
A summary of each day’s top rating changes from sell-side analysts on the street.
Fintech Focus
Your weekly roundup of hot topics in the exciting world of fintech.
Thank You
for registering for Benzinga’s newsletters and alerts.
• The Daily Analysts Ratings email will be received daily between 7am and 10am.
• The Market in 5 Minutes email will be received daily between 7am and 8am.
• The Fintech Focus email will be received every Friday between 2pm and 5pm.

Mid-Day Market Update: Shineco Rises After Q3 Results; Campbell Soup Shares Slide

Skyworks Downgraded By Raymond James On Lack Of Upside Potential