Nvidia Set to Reenter China Market, Potentially Adding $54 Billion in Revenue
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 2d ago
0mins
Source: Fool
- Market Reentry: The Chinese government is poised to approve the import of Nvidia's H200 AI chips, marking the company's reentry into a crucial market, albeit with restrictions, which is expected to provide sales opportunities for commercial and technology customers.
- Revenue Potential: Nvidia anticipates orders for over 2 million H200 chips from the Chinese market, priced at $27,000 each, potentially generating around $54 billion in additional revenue, and after a 25% export tax, netting approximately $40 billion.
- Strategic Impact: In 2024, Nvidia's revenue from China was $17.1 billion, and reentering the market will significantly enhance its sales outlook, with analysts projecting total revenue to reach $320 billion next year, further boosting the company's profitability.
- Shareholder Gains: Should Nvidia's earnings per share (EPS) reach $8.29, combined with its current P/E ratio of about 46, the share price could rise to approximately $380, more than double its current level, providing substantial returns for shareholders.
Analyst Views on NVDA
Wall Street analysts forecast NVDA stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for NVDA is 255.63 USD with a low forecast of 185.00 USD and a high forecast of 352.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
40 Analyst Rating
38 Buy
1 Hold
1 Sell
Strong Buy
Current: 185.040
Low
185.00
Averages
255.63
High
352.00
Current: 185.040
Low
185.00
Averages
255.63
High
352.00
About NVDA
NVIDIA Corporation is a full-stack computing infrastructure company. The Company is engaged in accelerated computing to help solve the challenging computational problems. The Company’s segments include Compute & Networking and Graphics. The Compute & Networking segment includes its Data Center accelerated computing platforms and artificial intelligence (AI) solutions and software; networking; automotive platforms and autonomous and electric vehicle solutions; Jetson for robotics and other embedded platforms, and DGX Cloud computing services. The Graphics segment includes GeForce GPUs for gaming and PCs, the GeForce NOW game streaming service and related infrastructure, and solutions for gaming platforms; Quadro/NVIDIA RTX GPUs for enterprise workstation graphics; virtual GPU software for cloud-based visual and virtual computing; automotive platforms for infotainment systems, and Omniverse Enterprise software for building and operating industrial AI and digital twin applications.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
