Nvidia, a prominent player in the semiconductor industry, found its stock slightly lower in early Tuesday trading, but analysts at UBS see promising prospects with the imminent release of its new Blackwell hardware, expected to make its debut later this year.
During premarket trading, Nvidia shares experienced a minor dip of 0.4% to $874.24, following a day of flat trading on Monday. Despite recovering from earlier dips in the month when its shares briefly dipped below the $800 mark, Nvidia has yet to reclaim its previous highs, hovering around $950, as anticipation builds for the introduction of its latest Blackwell chips.
Nvidia’s CEO, Jensen Huang, has lauded the upcoming Blackwell chips, highlighting their substantial advancements over the existing Hopper chips. Notably, Blackwell chips boast the capability to train an AI model using just a quarter of the graphics-processing units required by the Hopper chips, all while significantly reducing power consumption.
In a recent research note, UBS analyst Timothy Arcuri suggested that shipments of the Blackwell chips could commence in December, slightly later than the initial assumption of October. While this delay might result in a period of slower growth in the October quarter, Arcuri emphasized that it should not raise concerns about Nvidia’s overall outlook.
Maintaining a Buy rating on Nvidia’s stock, Arcuri raised his price target to $1,150 from $1,100, based on a price-to-earnings ratio of 28 times Nvidia’s projected earnings of $41.04 per share in 2025.
In premarket trading, other major chip makers, including Advanced Micro Devices (AMD) and Intel, experienced marginal movement, with AMD down 0.1% and Intel remaining flat. Investors eagerly await AMD’s first-quarter earnings report, scheduled for release after the stock market closes on Tuesday.
Nvidia’s stock performance has been impressive so far this year, witnessing a remarkable 77% surge year-to-date. This outperformance has exceeded the gains seen in both the S&P 500 index, which rose by 7.3%, and the Nasdaq Composite, which gained 6.5% over the same period.
Looking ahead, investors will closely monitor Nvidia’s performance, particularly as it gears up to launch its highly anticipated Blackwell chips. These new hardware offerings hold the potential to further propel Nvidia’s growth trajectory and solidify its position within the semiconductor market.
