On Thursday, Cantor Fitzgerald maintained a positive outlook on NVIDIA (NASDAQ:NVDA), reiterating an Overweight rating and a $175.00 price target for the stock. The firm's analysis indicates expectations for NVIDIA's revenue to pick up pace in the April quarter and projects a rise in gross margins, returning to around 75% in the second half of 2025.
This is anticipated to bolster the bull case scenario for NVIDIA, with Data Center revenues surpassing $200 million and earnings per share (EPS) advancing to $5.50 or higher by the end of 2025.
The analyst from Cantor Fitzgerald highlighted that the current expectations on the buy-side are aligned with an EPS of $5.50, with the focus now turning to the sustainability of growth into 2026. The ongoing advancements in artificial intelligence (AI) are seen as a key driver for NVIDIA, with escalating computational demands due to pre-training, post-training, and inference time-scaling. The firm underscored that until at least $1 trillion worth of Data Centers are modernized, the potential for a market digestion phase seems unlikely.
NVIDIA's aggressive annual technology cadence is also a contributing factor to the firm's confidence in the stock's performance. Upcoming innovations like the Rubin technology, expected late-2025 or early-2026, and the VERA stand-alone CPU in 2026, are anticipated to support the company's continued strength well into 2026. However, the firm notes that confidence in this outlook will be crucial for the stock to experience significant gains.
The analyst also pointed to the upcoming '4 goldilocks months' as a potential catalyst for the stock, referring to key events such as NVIDIA's update at the Consumer Electronics Show (CES), the expected guidance for top-line re-acceleration in February, and the March GPU Technology Conference (GTC).
These events could provide further support for the stock's upward trajectory. NVIDIA remains Cantor Fitzgerald's top pick, with the firm's price target reflecting a 32x multiple on the projected EPS of at least $5.50 for the year 2025.
In other recent news, NVIDIA Corporation (NASDAQ:NVDA) has reported a record-breaking quarter with a total revenue of $35.1 billion, marking a 94% increase from the previous year. The company's financial success is largely attributed to robust demand for AI infrastructure, with data center revenues climbing to approximately $30.8 billion. The successful launch of NVIDIA Hopper and the Blackwell architectures have also contributed to the company's financial success.
In recent developments, Baird increased its price target for NVIDIA shares to $195, citing strong demand for the company's products. Similarly, Raymond (NS:RYMD) James maintained a Strong Buy rating on NVIDIA and Mizuho (NYSE:MFG) maintained an Outperform rating, increasing the price target to $175.
These analyst ratings followed NVIDIA's robust earnings report. The company anticipates a Q4 revenue of $37.5 billion, and while it expects a temporary dip in gross margins during the Blackwell product ramp, it projects a return to mid-70s margins shortly.
InvestingPro Insights
NVIDIA's strong market position and financial performance are further underscored by recent data from InvestingPro. The company's market capitalization stands at an impressive $3.56 trillion, reflecting its dominant position in the semiconductor industry. NVIDIA's revenue has shown extraordinary growth, with a 194.69% increase over the last twelve months, reaching $96.31 billion. This aligns with Cantor Fitzgerald's bullish outlook on the company's future revenue acceleration.
InvestingPro Tips highlight NVIDIA's financial strength and market leadership. The company boasts a perfect Piotroski Score of 9, indicating robust financial health. Additionally, NVIDIA has maintained dividend payments for 13 consecutive years, demonstrating consistent shareholder returns despite its focus on growth and innovation.
The company's gross profit margin of 75.98% in the last twelve months supports Cantor Fitzgerald's projection of margins returning to around 75% in the latter half of 2025. This high profitability, coupled with NVIDIA's strong market position in the AI-driven semiconductor space, reinforces the analyst's positive outlook.
For investors seeking a deeper understanding of NVIDIA's potential, InvestingPro offers 22 additional tips, providing a comprehensive analysis of the company's financial health and market prospects.
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