NVIDIA corporation designs, develops and markets three-dimensional (3D) graphics processors units (GPUs) and related software for the mainstream personal computer market.
| Key Statistics | ||||||||
| 52-Week Range | Avg. Daily Vol (3 Mo) | Market Value | Dividend Yield | Float % | Target Price | LT Growth Rate |
Consensus Rating (5 strong buy – 1 strong sell) |
Next Earnings Announcement |
| 180.54 – 589.06 | 13,174,450 | 335,938.0 | 0.1% | 95.9% | 564.97 | 2082.4% | 4.44 | 18/11/2020 |
NVDA has also expanded into other fields such as artificial intelligence and data centres, with chip systems used in autonomous vehicles, mobile devices and other tools.
There are two main segments for sales, GPUs products focusing on PC gaming and cloud-based game streaming services, computer aided design, video editing and deep learning for AI. The second is the Tegra line which focuses on automotive chip systems for autonomous vehicles, medical instruments, cloud based mobile applications and robotics. The GPUs are the primary source of revenue, accounting for 87% of sales while the Tegra line accounts for 13% in 2020. Asia generates the majority of sales, accounting for 80% with Taiwan accounting for 30% of sale followed by China with 25% and the rest of the Asia Pacific the remaining 25% while the U.S. accounts for 10% of sales. The sales channel works with both end customers and with network partners, including equipment manufacturers, retailers and distributors, cloud service providers and automotive manufacturers. In 2020 gaming accounted for 50% of revenue, followed by data centres 27%, professional visualization 11%, automotive 6%, and OEM & IP 5%.
NVDA has been a beneficiary from the work, learn and game from home shift due to the COVID-19 pandemic as well as increased artificial intelligence use in cloud applications with data centre and gaming segments driving revenue in Q1 & Q2 2020. Additionally, in September 2020 the company announced a $40 billion deal for SoftBank’s ARM unit to expand its GPU business, the largest semiconductor transaction since 2016.
Revenue edged lower in the financial year ended January 2020, declining 6.8% to $10,918m however is forecast to rise 44.4% in 2021 to $15,765.8m in 2021 and a further 18.8% to $18,729.3m. Adjusted earnings per share also declined in 2020 by -24.5% to $4.59 due to weaker sales in the GPU segment following the burst of the cryptocurrency mining boom. Adjusted EPS is forecast to rise 56% in 2021 to $9.01 and a further 22% in 2022 to $11.02 which would see the stock trade on forward P/E multiples of 60.4 and 49.4 respectively. The average forward P/E of peers over the same period is 39.5 and 31.8, with NVDA trading at a ~55% premium.
The average target price of analysts covering the stock is $567.83 with 80% of analysts rating the stock as a buy, compared to 7% as a sell and 12% as a hold.
