The game continues for Nvidia stock
The game continues for Nvidia stock.
The Nvidia stock report, commissioned and edited by Barron’s, was recently published by the investment and research firm. The report is a model of analytical thinking. They should not be construed as the opinion or recommendation of Barron. Certain reports offered or expected to offer investment banking or other services to the companies analyzed.
Buy • Price $207.54 on Feb. 22
Nvidia’s revenue for the latest quarter was $6.05 billion, down 2 percent sequentially or 21 percent year-over-year. Full-year revenue was $27 billion, higher than the Street consensus of $6.01 billion from a year earlier. Non-GAAP earnings per share were 88 cents, compared to the Street consensus of 81 cents.
US cloud service providers reported year-over-year growth, while year-over-year and quarter-over-quarter changes showed that sales in China were down. Gaming revenue of $1.83 billion increased 16% sequentially and was down 46% from a year ago.
Gamers quickly sold out of the market for the new RTX 4090, 4080, and 4070ti PC gaming processors and online platforms. The popularity of the flagship RTX 4090 has grown exponentially… reflecting gamers’ desire for high-performance graphics. Target price for the stock: $250.
Overweight • Price $60.66 on Feb. 17
by Wells Fargo
Shell remains our first choice for blended oils. A subsidiary of Shell Petroleum has completed Nature Energy Biogas for approximately $2 billion, which is Europe’s largest producer of renewable natural gas.
While the acquisition is not a stock-changing event, the acquisition complements Carbon’s efforts to expand the development of Shell’s RNG portfolio and keep pace with peers. The acquisition would include a $23-$27 billion acquisition by Shell in 2023. Natura Energy has a pipeline of 14 related infrastructure projects, two crude facilities, and approximately 30 new plant projects in Europe and North America, more than a third of which are in mid- to late-stage development.
The acquisition supports Shell’s efforts to convert its growing European LNG customer base to LNG. The company expects to recognize revenue and generate double-digit revenue upon completion of the acquisition. Target Price: $67.
TJX Cos. TJX-NYSE
Outperform • Price $77.46 on Feb. 22
Reiterating our $88 target on TJX—22 examples of our fiscal year 2025 EPS report, we option that management slightly outperforms its plan to return at a 10.6% pretax margin by FY 25. FY23’s 29% return on invested capital is the highest ever. US-only sales comps rose 4% in Q4, to guide of flat to 1%.
But it was burned by a combination [chauri] charge of about 60 points [0.6%], a 110-bps swing from a planned 50 bps gain, implying a (13 cents per share) effect. That cut TJX’s adjusted Q4 pretax margin below guidance. Management is guiding for FY24 (a 53-week year) up 2% to 3%, year over year, and total sales of $52.5 billion to $53.2 billion, up 6% year-over-year at the midpoint. The year represents growth.
We see long-term EPS potential of $4.68 through FY27, which we are driven by revenue reaching $62 billion.
Buy • Price $128.45 on Feb. 22
by Guggenheim Securities
ETSE’s operating results for Q4 2022 exceeded our expectations, primarily driven by increased web traffic and conversions [into sales], active buyers and active sellers, improved acquisitions [revenue from third party sales] and normalized gross margin. (~72%), and only 0.1% of employees improve continuously.
Q2 2023 Year-over-year sales growth in total product sales. Combined with our expectations for modest workforce growth and normalized gross margin, ETC appears well positioned to deliver strong operating results through 2023.
PDC Energy PDCE-Nasdaq
Buy • Price $61.93 on Feb. 22
After the market closed yesterday, PDC reported strong results for the fourth quarter of ’22 with operating, construction and capital expenditures in line with expectations. Tal brought another quartet of harsh responses. We estimate that PDC will return $298.8 million to shareholders through a core dividend (paid in the first quarter) and share repurchases, which is 115.5% of 4Q22 free cash flow.
In addition, PDC has reaffirmed its commitment to 60% long-term shareholder returns and dividends, the recently revised $2 billion buyback authorization and year-end specials, if applicable. Target Price: $88.
Arcutis Biotherapeutics ARQT-Nasdaq
Buy • Price $16.18 on Feb. 21
Arctis will release its 4Q22 results on February 28. Areas of focus for investors could include 4Q22 sales of Zoref (a topical treatment for plaque psoriasis) of $2.4 million (about $2 million per Bloomberg contract), which we estimated. Zoriv delivery procedures and data, including patient/physician notes; and payer coverage updates. Based on this year’s strong [recipe] trends, we are raising our 2023 Zoriv sales forecast to $42 million to $50 million. Target price on the stock: $61.
Nvidia shares rose nearly 15 percent as investors and analysts praised the company’s earnings and growth opportunities from artificial intelligence.
The stock was the biggest gainer on the S&P 500 and Nasdaq-100 in early trading and is on track for its biggest daily gain since March 24, 2020, up 17%.
If it closes at current levels, the stock will reach its highest level since April 7, 2022.
The semiconductor company beat earnings expectations with adjusted earnings of 88 cents per share on revenue of $6.05 billion. Wall Street had expected earnings of 81 cents per share on revenue of $6.02 billion, according to FactSet.