Wolfe Research analysts increased their price target for NVIDIA (NASDAQ:NVDA) to $150 from $125 per share, citing promising supply chain checks that indicate substantial growth for the company in 2025.
According to the research note, recent supply chain data points to over 50% content growth for NVIDIA GPUs in 2025. This growth is attributed to the transition to Nvidia's new Blackwell platform, which promises higher average selling prices (ASPs) and an improved product mix.
Wolfe Research also anticipates potential unit growth, noting early indications of a 50% increase in GPU units for 2025. While this figure is approached cautiously in their current estimates, it is acknowledged as a potential upside to their revised projections. Nvidia's data center business is highlighted as a key growth driver, with at least 50% growth expected in 2025. This is supported by factors such as cloud service providers adopting the Blackwell platform, better allocations for enterprise customers, and additional revenue streams from "Sovereign AI."
The report also anticipates higher networking attach rates for Nvidia's GB200, including both InfiniBand and NVDA Spectrum-X solutions, which are essential for optimizing AI cluster performance.
Based on these revised estimates, Wolfe Research projects Nvidia's 2026 revenue to reach $177.0 billion and EPS to hit $4.03. The new $150 price target is based on a valuation of approximately 37 times their 2026 EPS, consistent with Nvidia's historical averages. Wolfe Research maintains their Outperform rating for Nvidia, emphasizing the company's strong earnings momentum and long-term potential in the AI sector. They note Nvidia's significant outperformance compared to broader markets and its peers in the semiconductor industry.