What to Expect When Nvidia Reports After the Close

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Nvidia Corp. (NASDAQ: NVDA) is scheduled to release its fourth-quarter earnings report after the markets close on Thursday. The consensus estimates from Thomson Reuters are $1.16 in earnings per share (EPS) and $2.68 billion in revenue. The same period of last year reportedly had EPS of $0.99 and $2.17 billion in revenue.

This was the king of the chip stocks in 2017, and while analysts kept hiking their price targets at a fast rate, that was not fast enough to keep up with its big gains last year. Then came a brief pullback, but Nvidia has seemed to be almost immune to the recent processor woes of AMD and Intel. The stock had risen to new all-time highs prior to the recent correction taking hold.

The chip maker made a couple deals to get into businesses that it believes will be the future of the driving industry. Nvidia picked two prominent partners as it made announcements about the plans at the Consumer Electronics Show (CES) in January. It is also worth noting that companies sometimes make breathless announcements at CES to dazzle the huge audiences of technofiles, mostly from corporations, who attend.

The first deal is with Volkswagen. Nvidia calls it an artificial intelligence co-pilot. The tech company’s management announced:

Volkswagen and NVIDIA today shared their vision for how AI and deep learning will shape the development of a new generation of intelligent Volkswagen vehicles using the NVIDIA DRIVE IX platform to create new cockpit experiences and improve safety.

Even more recently Nvidia announced that it would be partnering with Aquantia for its new DRIVE Xavier and DRIVE Pegasus platforms in autonomous vehicles. The Aquantia Ethernet products will communicate the data and decisions back and forth throughout the system at 10 Gbps over automotive Ethernet cables to help provide a seamless autonomous experience.

Excluding Thursday’s move, Nvidia had outperformed the U.S. broad markets in 2018, with its shares up about 28% year to date. Over the past 52 weeks, the stock was up 92%.

A few analysts weighed in on Nvidia ahead of the earnings report:

  • Susquehanna reiterated a Neutral rating with a $200 price target.
  • Goldman Sachs has a Buy rating with a $281 price target.
  • Merrill Lynch has a Buy rating and a $275 price target.
  • Mizuho has a Buy rating with a $240 target price.
  • B. Riley has a Buy rating with a $270 price target.

Shares of Nvidia were last seen down 2% at $224.24, with a consensus analyst price target of $220.08 and a 52-week range of $95.17 to $249.27.