Is Nvidia Stock a ‘Buy’ before Its Q1 Earnings Results?

Nvidia (NASDAQ:NVDA) stock gained around 3% in the pre-market today at 7:44 AM ET. The stock rose after BMO Capital analyst Ambrish Srivastava upgraded the stock from “market perform” to “outperform.” Srivastava also increased its target price on the stock from $285 to $425. According to a report from TheFly, “Nvidia is uniquely positioned to continue to benefit from a massive shift in the compute landscape, contends the analyst. Srivastava sees no reason why the company cannot grow its datacenter business to at least a $20B annual run rate versus the $4.8B for this year. Consequently, the analyst sees long-term earnings per share of $20 for Nvidia.”

Today, Deutsche Bank increased its target price on Nvidia stock from $290 to $300. Last week, Jefferies increased its target price from $290 to $370. Raymond James increased its target price to $330 from $300. Meanwhile, Rosenblatt Securities lifted Nvidia’s target price to $340 from $315. Wedbush increased its target price by $29 to $340, while Needham increased it to $360 from $270.

Analysts’ recommendations for Nvidia stock

Among the 40 analysts covering Nvidia stock, 32 recommend a “buy,” six recommend a “hold,” and two recommend a “sell.” The mean target price of $323.77 implies a 4.7% downside from the closing price of $339.63 on May 15.

First-quarter earnings expectations

Nvidia will likely release its earnings results for the first quarter fiscal 2021, which ended in April, on Thursday after the closing bell. In the first quarter, Wall Street analysts expect Nvidia to post sales of $3.0 billion—a rise of 34.5% YoY (year-over-year) compared to $2.5 billion in the first quarter of fiscal 2020. Also, analysts expect the company’s adjusted EPS to rise by 91% YoY to $1.68 in the first quarter.

Peer comparison

AMD (NYSE:AMD) delivered a first-quarter revenue of $1.79 billion, which represents an increase of 40.4% YoY. Wall Street expected revenue of $1.78 billion. The company posted an adjusted EPS of $0.18, which met the consensus estimate of $0.18. Read Is AMD Stock a ‘Sell’ after Its Q1 Earnings? to learn more.

Intel (NASDAQ:INTC) delivered a first-quarter revenue of $19.8 billion, which represents an increase of 23.5% YoY. Wall Street expected revenue of $18.70 billion. The company posted an adjusted EPS of $1.45, which beat the consensus estimate of $1.28. Read Is Intel Stock a ‘Sell’ after Its Q1 Earnings? to learn more.

Nvidia’s stock returns

Nvidia stock rose 5.7% on May 15 and closed at $339.63 with a market cap of $208.9 billion. The stock was trading 0.1% below its 52-week high of $340.02. Meanwhile, the stock was trading 156.1% above its 52-week low of $132.60.

Based on the closing price on May 15, Nvidia stock was trading 13.5% above its 20-day moving average of $299.26. The stock is also trading 26.1% above its 50-day moving average of $269.29 and 29.3% above its 100-day moving average of $262.75.

Nvidia’s 14-day relative strength index score is 69, which indicates that the stock is near the overbought levels. Nvidia stock has an upper Bollinger Band level of $331.47. The company’s middle Bollinger Band level is $299.26, while its lower Bollinger Band level is $267.05. On May 15, Nvidia stock closed near its upper Bollinger Band level, which indicates that the stock is overbought.

On May 15, the S&P 500 Index rose by 0.39%. Intel and AMD lost 1.35% and 0.57%, respectively, on the same day.

Read Is Nvidia Stock a Smart Long-Term Buy? and Nvidia Fell 1% Today, Analyst Downgraded the Stock to learn more.