Nvidia: Best In Class Among Semiconductors In 2016
Alex Cho • 16 Comments
Alex Cho • 16 Comments
Nvidia Is A $12 Stock Worth $18: A Sum Of The Parts Analysis
Adam Levine-Weinberg • 65 Comments
Adam Levine-Weinberg • 65 Comments
Fri, May 13, 10:21 AM
- Nvidia (NASDAQ:NVDA) has rocketed 11.5% after last night's solid earnings beat and strong revenue guidance for Q2.
- Analysts have responded with price target increases and a couple of upgrades. Roth Capital upgraded to Buy from Neutral, and boosted its price target to $40, from $34.50 (the stock is trading at $39.66 as of now).
- The Datacenter segment grew 63% (and 47% Q/Q), "largely driven by deep learning adoption by cloud operators (IBM, Facebook, Microsoft, Amazon, Alibaba, Baidu, and Twitter), indicating to us that NVDA has found its next big growth vector,” analyst Brian Alger says of the "massive potential" there.
- Brean reiterated a Hold but raised its fair value range to $35-$40. “The Company continues to execute well and has growth drivers/levers in Tegra and GPUs and more importantly, is expecting a resumption of growth from its Gaming business driven by its Pascal-based GeForce products in Jul-16Q,” says analyst Mike Burton.
- Meanwhile, Jefferies Group raised its price target to $45 from $42; Wedbush raised its target to $42 from $38; RBC Capital increased its target to $40 from $36.
- Now read Nvidia Drops Another Pascal Bomb On AMD »
Thu, May 12, 4:41 PM
- Nvidia (NASDAQ:NVDA) has gained 4.9% after hours following Q1's earnings beat featuring a view for Q2 above analyst consensus as well.
- Revenues grew by double digits with a $100M gain in Gaming, its biggest platform, and revenue grew in all platforms except one.
- For Q2, the company's forecasting $1.32B-$1.38B, significantly higher than consensus for $1.28B. It's expecting non-GAAP gross margin of 58%, non-GAAP opex of about $445M and capex of $30M-$40M.
- Revenue by platform: Gaming, $687M (up 17%); Professional Visualization, $189M (up 4%); Datacenter, $143M (up 63%); Automotive, $113M (up 47%); OEM and IP, $173M (down 21%). GPU business gained 15% and Tegra Processors grew 10%, to $160M (up 2% sequentially thanks to growth in Tegra Automotive).
- Conference call to come at 5 p.m. ET.
- Press Release
Thu, May 12, 4:22 PM
Wed, May 11, 5:35 PM
Wed, Feb. 17, 4:51 PM
- In addition to soundly beating FQ4 estimates, Nvidia (NASDAQ:NVDA) is guiding for FQ1 revenue of $1.26B (+/- 2%), above a $1.23B consensus.
- Top-line performance: As was the case in FQ3, strong gaming GPU demand (in spite of a weak PC market) was a major tailwind: Total GPU revenue rose 10% Y/Y to $1.18B, with gaming GPU revenue rising 21%. Quadro (workstation GPU) revenue rose 7% to $203M, and Tesla/GRID (HPC server/cloud) GPU revenue rose 10% to $97M.
Tegra app processor revenue rose 40% to $157M, fueled by a 68% increase in automotive revenue to $93M (the result of both infotainment module Tegra sales and R&D contracts). The Intel deal once more produced licensing revenue of $66M.
- Financials: Non-GAAP gross margin was 57.2%, +70 bps Q/Q and +100 bps Y/Y, and above a guidance midpoint of 57%. FQ1 GM guidance is at 57.5% (+/- 50 bps). Operating expenses rose 6% Y/Y to $445M (compares with 12% revenue growth). 4.3M shares were repurchased through an accelerated buyback. Nvidia ended FQ4 with $5.04B in cash and $1.41B in convertible debt.
- NVDA +5.6% after hours to $29.20.
- Nvidia's FQ4 results, earnings release, CFO commentary (.pdf)
Wed, Feb. 17, 4:22 PM
Tue, Feb. 16, 5:35 PM| Tue, Feb. 16, 5:35 PM
Nov. 6, 2015, 4:47 PM
- The Philadelphia Semi Index (SOXX +2.6%) rallied after Nvidia (NVDA +13.9%) beat estimates and provided strong guidance (gaming GPUs led the way), Skyworks (SWKS +7.1%) offered good calendar Q4 guidance and RF chip peer Qorvo (QRVO +23.2%) posted better-than-feared results and guidance. The Nasdaq rose just 0.4%.
- Also: Analog/Ethernet chipmaker Microsemi (MSCC +4.9%) beat calendar Q3 revenue estimates and offered solid Q4 guidance: Revenue of $325M-$329M and EPS of $0.70-$0.74 vs. a consensus of $323.5M and $0.72.
- Big gainers today included specialty foundry/Skyworks supplier TowerJazz (TSEM +6%), smart TV/home automation chipmaker Sigma Designs (SIGM +16.6%), telecom/networking IC provider InPhi (IPHI +6.7%), touch controller/LCD driver supplier Synaptics (SYNA +6.1%), FPGA maker Lattice Semi (LSCC +6.6%), network processor vendor Cavium (CAVM +5.6%), DSP core IP provider CEVA (CEVA +7.2%), and analog/mixed-signal chipmakers MagnaChip (MX +4.6%) and Semtech (SMTC +5.4%).
- On its earnings call (transcript), Qorvo mentioned Chinese smartphone demand (a recent headwind) is "seeing a bit of a rebound," and that the launch of 5-mode and 6-mode Chinese 4G phones is boosting RF chip content. Qorvo also thinks Chinese base station activity (an issue for many telecom chip/component firms) bottomed in Q3, but cautions a mobile infrastructure recovery is expected to be gradual.
- Microsemi stated on its call (transcript) broadband gateway chip sales were a Q3 strong point, that telecom infrastructure began to improve, and that defense/aerospace sales are expected to rebound in 2016. Industrial demand remained soft in Q3.
- MKM's Ian Ing has upgraded Nvidia to Buy, calling shares "expensive and worth it." Ing: "We see a sustainable growth trajectory, given [Nvidia's] positioning to lead in significant paradigm changes favoring more valuable semiconductor solutions: automotive evolving from driver assist to autonomous driving, gaming transitioning to virtual reality and professional or social E-sports, and cloud computing increasingly using GPU accelerators for machine learning."
- Chip ETFs: SMH, XSD, PSI, SOXL, USD, SOXS, SSG
- Last week: Chip stocks sell off after NXP, STMicro, others issue soft guidance
Nov. 5, 2015, 4:47 PM
- In addition to beating FQ3 estimates, Nvidia (NASDAQ:NVDA) is guiding for FQ4 revenue of $1.3B (+/- 2%), above a $1.21B consensus.
- Top-line performance: GPU sales continue growing in spite of a weak PC market, rising 12% Y/Y in FQ3 to $1.11B thanks to a 40% increase in gaming GPU sales. Professional GPUs (Quadro) and data center GPUs (Tesla/GRID) each fell 8%. Tegra sales fell 23% to $129M, with smartphone/tablet weakness offsetting automotive and development service growth.
- Financials: Gross margin (non-GAAP) was 56.5%, -10 bps Q/Q and +100 bps Y/Y, and in-line with guidance. FQ4 GM guidance is at 57% (+/- 50 bps). Operating expenses rose a moderate 4% Y/Y to $430M, and 4.6M shares were received through a now-completed accelerated buyback. Nvidia plans to return $1B to shareholders in FY17 (ends Jan. '17). The company ended FQ3 with $4.7B in cash, and $1.4B in long-term debt.
- Shares have risen to $29.94 after hours, making new 52-week highs. Needham's pre-earnings downgrade wasn't well-timed.
- FQ3 results, PR, CFO commentary (.pdf)
Nov. 5, 2015, 4:21 PM
- Nvidia (NASDAQ:NVDA): FQ3 EPS of $0.46 beats by $0.21.
- Revenue of $1.31B (+6.5% Y/Y) beats by $130M.
- Shares +5.12%.
Nov. 4, 2015, 5:35 PM
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Oct. 22, 2015, 12:24 PM
- The Philadelphia Semi Index (SOXX +3%) has risen above $90 for the first time since July on a day the Nasdaq is up 1.5%. Helping out: Texas Instruments (TXN +10.4%) soundly beat Q3 estimates, reported positive growth for its analog and embedded processing (DSP/microcontroller) units in spite of a customer inventory correction, and (with the help of iPhone content gains) provided mostly above-consensus Q4 guidance.
- Meanwhile, Cypress Semi (up 4.1%) is rallying in spite of posting mixed Q3 results and issuing light Q4 guidance. A new $450M buyback is helping.
- TI/Cypress microcontroller peers NXP (NXPI +4.2%), Freescale (FSL +3.5%), STMicroelectronics (STM +2.5%), and Microchip (MCHP +2.9%) are among the gainers. As are TI analog/mixed-signal peers ON Semi (ON +5%), Intersil (ISIL +3.2%), IDT (IDTI +3.6%), Monolithic (MPWR +3.3%), and Silicon Labs (SLAB +2.6%).
- Other notable gainers include InvenSense (INVN +2.6%), Nvidia (NVDA +3.5%), Cavium (CAVM +4.4%), Knowles (KN +3.6%), and Lattice Semi (LSCC +7%).
- On its earnings call (transcript), TI mentioned automotive chip demand (boosted by growing chip content in various systems) was strong. Industrial sales were roughly flat (better than expected), and personal electronics benefited from "demand from one customer" (likely Apple). Wireless infrastructure fell 30% Y/Y (Chinese weakness), but rose Q/Q.
- Chip stocks also outperformed yesterday after Western Digital announced it's buying SanDisk, Lam Research announced it's buying KLA-Tencor, and CPU core giant ARM (ARMH +2.7%) beat Q3 revenue estimates (EPS slightly missed) with the help of a 20% Y/Y increase in ARM chip shipments to 3.6B, and stated it expects 2015 revenue to be in-line with market expectations.
- Chip ETFs: SMH, XSD, PSI, SOXL, USD, SOXS, SSG
Aug. 6, 2015, 5:42 PM
- In addition to beating FQ2 revenue estimates, Nvidia (NASDAQ:NVDA) is guiding for FQ3 revenue of $1.18B (+/- 2%), above a $1.1B consensus.
- Though officially missing consensus by $0.05, FQ2 GAAP EPS would've beaten by $0.16 if not for a $0.19/share charge related to the wind-down of Nvidia's Icera 4G modem unit, and a $0.02 charge related to a Shield tablet recall.
- In spite of a very weak PC market, Nvidia's GPU sales rose 9% Y/Y in FQ2 to $959M, thanks partly to a 51% increase in gaming-related GPU sales. The high-end/high-margin GeForce GTX line was particularly strong.
- PC OEM and Quadro workstation GPU sales fell due to weak end-market demand. Tesla HPC GPU sales also dropped, something Nvidia blames on project timings. Tegra app processor sales fell 19% to $128M, as soft smartphone/tablet-related sales offset automotive growth.
- Financials: EPS received a lift from $400M worth of buybacks. Also: Gross margin was 56.6%, -30 bps Q/Q and +20 bps Y/Y, and above guidance of 55.5%-56.5%; FQ3 GM guidance is at 56.5% (+/- 50 bps). Operating expenses fell 2% Y/Y to $421M. Nvidia ended FQ2 with $4.5B in cash, and $1.4B in long-term debt.
- Shares have jumped to $22.35 in AH trading. Expectations were fairly low going in.
- FQ2 results, PR, CFO commentary (.pdf)
Aug. 6, 2015, 4:28 PM
- Nvidia (NASDAQ:NVDA): Q2 EPS of $0.05 misses by $0.05.
- Revenue of $1.15B (+4.5% Y/Y) beats by $140M.
- Shares +7.8%.
May 8, 2015, 7:30 PM
- Initially down just modestly after posting mixed FQ1 results, issuing weak FQ2 guidance, and upping its capital returns, Nvidia (NASDAQ:NVDA) sold off today to its lowest levels since early February. Roth downgraded to Neutral, and Stifel and Wedbush cut their targets. JMP went contrarian and hiked its target by $1 to $28.
- "[W]e underappreciated the company’s exposure to PC OEM weakness," writes MKM's Ian Ing (Neutral). He also thinks Nvidia's gaming GPU business (an FQ1 strong point) could once more have "reasonable competition" thanks to the pending launch of AMD's R9 300 GPU series (will be the first GPUs to support High Bandwidth Memory), at least until Nvidia's Pascal GPUs launch in 2016.
- Raymond James Hans Mosesmann (Strong Buy) argues Nvidia's non-PC ops remain healthy. "Management was unambiguous regarding continued strength in Gaming, Tesla (datacenter acceleration seeing >50% y/y growth), and Auto." He also considers a seasonal 2H15 sales rebound plausible, given the Windows 10 launch, 4K display growth, and virtual reality product launches.
- On the CC (transcript), CFO Colette Kress stated gaming GPU revenue rose 25% Y/Y in FQ1 to $587M, HPC/cloud revenue 57% to $79M, and auto revenue 121% to $77M. On the other hand, OEM/IP revenue fell 38% to $218M, thanks to both PC OEM weakness and the end of life for Tegra mobile design wins. She added a weak euro pressured Nvidia's European sales.
- In addition to upping its dividend, Nvidia has added $1.62B to its buyback authorization, bringing its total size to $2B. The company now plans to return $800M to shareholders in FY16 (ends Jan. '16), up from a prior $600M.
NVIDIA Corp. is a visual computing company, connecting people through computer graphics. It is engaged in creating graphics chips, which is used in personal computers. The company operates through two segments: Graphics Processing Unit (GPU) and Tegra Processor. The GPU segment includes sales of... More
Industry: Semiconductor - Specialized
Country: United States
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