Nvidia is set to report earnings after the bell. Here’s what Wall Street expects
Stock Analysis & Ideas

Nvidia is set to report earnings after the bell. Here’s what Wall Street expects

Once the bell rings to signal an end to today’s trading action, Nvidia (NVDA) will take its turn to announce its latest financial report.

Normally a perennial outperformer, the same can certainly not be said ahead of the F3Q (October quarter) print. Ongoing declining gaming sales, weakness in data center and the restrictions on exporting state-of-the-art data center chips to China have all played their part in keeping sentiment low. To wit, the shares are down 45% on a year-to-date basis.

That final headwind mentioned above has a big part to play in keeping Wedbush analyst Matt Bryson’s expectations low.

“Uncertainty pertains mostly to NVDA’s data center business as we lack visibility into how new US restrictions on shipments of AI chips to China might have affected sales or how softer data center spend might impact AI requirements,” the analyst explained. “While management identified $400M sales as being at risk; we are uncertain whether product was pulled through indirect channels (boosting FQ3) or if rather NVDA might see a bump in the current quarter with the release of its new parts designed to match the new threshold limitations set by Commerce.”

Elsewhere, there are also questions around the timing of a “rebound” for gaming sales, and the overall uncertainty due to “slowing data center spend” with traditional enterprise budgets expected to come “under pressure” in 2023.

That said, Bryson has a “constructive view around the company’s longer-term fundamentals,” and sees “little risk to the 3 to 5 year story.” However, with the current headwinds front and center and the near-term conditions dictating sentiment, the 5-star analyst is unwilling to join the bulls camp just yet.

As such, Bryson sticks with a Neutral rating alongside a $160 price target, suggesting shares will stay range-bound for the foreseeable future. (To watch Bryson’s track record, click here)

Most of Bryson’s colleagues, however, take a more bullish approach. With 23 Buys vs. 8 Holds, the stock claims a Moderate Buy consensus rating. Going by the $192.14 average target, NVDA shares are expected to deliver returns of ~19% in the year ahead. (See Nvidia stock forecast on TipRanks)

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Disclaimer: The opinions expressed in this article are solely those of the featured analyst. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.


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