On Monday, Stifel maintained a Buy rating on NVIDIA Corporation (NASDAQ:NVDA) and increased its price target to $865 from the previous $665. The adjustment comes as the company prepares to report its fourth-quarter earnings for fiscal year 2024 after the market closes on Wednesday, February 21.
The firm's analyst points to various factors supporting robust demand for NVIDIA's products. Improved GPU availability has been noted, yet lead times are still extended, suggesting a sustained interest in NVIDIA's offerings. Hyperscalers, AI partners such as OpenAI, Anthropic, and Inflection, as well as a diverse group of large enterprises, cloud-GPU users, and AI startups, are all contributing to a strong demand outlook.
Investors and analysts are expected to focus on the balance between the training and inference phases of the GPU demand curve during the upcoming earnings call. Stifel anticipates continued significant investment in large language model (LLM) training throughout 2024. The long-term prospects hinge on whether the inference phase can expand sufficiently to balance the projected slowdown in training cluster deployments.
Further insights into NVIDIA's perspective on these matters are anticipated at the March GTC event. Stifel's commentary underscores NVIDIA's advantageous position to capitalize on AI-related infrastructure investments, reinforcing the firm's optimistic outlook for the technology giant's financial performance.
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