NVIDIA (NVDA) stock fell about 2.4% on September 20, and the stock closed the trading day at $172.69. NVDA stock is trading 41.01% lower than the 52-week high of $292.76 it saw on October 2, 2018. Meanwhile, the stock is trading 38.75% higher than the 52-week low of $124.46 it saw on December 26, 2018.
NVIDIA stock has returned around 29.4% YTD (year-to-date). The stock has risen about 1.73% in today’s trading session as of 9:48 AM EDT. The stock also rose in pre-market trading.
Why did NVIDIA stock rise?
Earlier today, SunTrust Robinson Humphrey analyst William Stein increased the target price on NVIDIA stock to $216 from $210. Stein reaffirmed the “buy” rating on the stock.
In a note to clients, the analyst said, “Of our proprietary semi and component supply chain contacts, multiple pointed to improving demand trends in all end markets: gaming, pro-viz, automotive, and most important, datacenter.”
The new target price reflects a potential upside of 25.1% from the company’s closing price of $172.69 on September 20. At the closing price of $172.69, NVIDIA’s market capitalization is $105.17 billion.
Analysts’ recommendations and target price
Among the 39 analysts covering NVIDIA stock, 26 analysts have “buy” ratings on the stock—unchanged from the previous month. Ten analysts have “hold” ratings on the stock, down from 12 in the previous month. Only three analysts have a “sell” rating on the stock, which is up from two in the previous month.
Currently, NVIDIA analysts have a 12-month target price of $186.49 on the stock. On September 20, the stock was trading at a discount of 8.0% to analysts’ 12-month target price. Its median target price was $190.00 on the same date.
Forward PE ratio
NVIDIA has a forward PE ratio of 32.05x for fiscal 2020, which ended in January. For fiscal 2021, the ratio is 24.37x. The company’s adjusted EPS would fall 18.8% in fiscal 2020 and rise 31.5% in fiscal 2021.
The stock looks overvalued, considering its expected negative earnings growth for fiscal 2020. However, the stock appears undervalued based on its expected earnings growth of 31.5% and its PE ratio of 24.37x for fiscal 2021.
Revenue and earnings expansion
NVIDIA’s revenues are expected to fall 8.1% in fiscal 2020 to $10.77 billion. Its sales could increase 19.8% in fiscal 2021 to $12.90 billion and increase 15.4% to $14.89 billion in fiscal 2022.
In comparison, the company’s adjusted EPS could fall 18.8% to $5.39 in fiscal 2020. The company’s adjusted EPS could increase 31.5% to $7.09 in fiscal 2021 and at an annual rate of 12.5% in the next five years. NVIDIA has a dividend yield of 0.37%.
NVIDIA’s stock returns
The stock’s trailing five-day, trailing one-month, and trailing 12-month price movements were -5.1%, 2.9%, and -35.2%, respectively. Based on its September 20 closing price, NVIDIA stock was trading 1.1% below its 20-day moving average of $174.61. The stock was trading 2.4% above its 50-day moving average of $168.66.
The company was trading 6.4% above its 100-day moving average of $162.25. NVIDIA’s 14-day relative strength index (or RSI) score is 49, which suggests that investors are neutral toward the stock.
On September 20, NVIDIA stock closed near its Bollinger Band midrange level of $174.09. This value suggests that the stock isn’t overbought or oversold.
NVIDIA’s current 14-day MACD (moving average convergence divergence) is -4.82. The negative score suggests a downward trading trend for the company.
On the same day, Intel (INTC) stock fell 1.65% and closed at $50.72. Qualcomm (QCOM) stock fell 2.29% to $76.44. Intel and Qualcomm have returned 8.1% and 34.3%, respectively, YTD. Intel and Qualcomm have market capitalizations of $224.7 billion and $92.9 billion, respectively.