Nvidia: Here's why Cantor Fitzgerald raised its price target on the stock

Published: Jun 25, 2024 Duration: 00:03:58 Category: News & Politics

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STICKING WITH NVIDIA OUR NEXT GUEST RAISING THE TARGET TO 140, SAYING HE'S KATIECONFIDENT THAT NVIDIA WILL REMAIN THE TOP FORCE. CJ JOINS US NOW. IN TERMS OF THE PRICE TARGET HOW MANY TIMES HAVE YOU RAISED IT THE LAST YEAR OR SO AS NVIDIA CONTINUES THE UPWARD TRAJECTORY? >> GOOD MORNING, LESLIE. PROBABLY TWO OR THREE TIMES. AND, YOU KNOW, I THINK THE GREAT THING WAS A YEAR AGO, WHEN YOU HAD THE MASSIVE BEAT IN AUGUST AND I THINK SINCE THEN, YOU KNOW, DATA CENTER HAS CONTINUED TO SURPRISE. WHEN YOU TAKE A STEP BACK AND THINK ABOUT ACCELERATION INSIDE DATA CENTERS LOOKING FORWARD, WE'RE ONLY ABOUT 8 OR 9% PENETRATED AND JENSEN'S VIEW IS WE'RE GOING TO 100%. IF THAT'S RIGHT THERE'S A LONG RUNWAY AHEAD AND I WOULD SURMISE THE STREET WOULD BE RAISING THE PRICE TARGETS MANY, MANY TIMES OVER THE COMING YEARS. >> DO YOU THINK AT THESE LEVELS THE PACE OF INNOVATION THAT YOU DESCRIBE, THE RUNWAY YOU DESCRIBED IS PRICED IN OR DO YOU THINK IT'S STILL MISUNDERSTOOD BY THE MARKET? >> I DON'T. I THINK THE SEISMIC SHIFT LAST YEAR WAS THE ANNOUNCEMENT OF MOVING TO AN ANNUAL CADENCE IN TERMS OF NEW TECHNOLOGY RELEASES. AND IT'S A VERY POWERFUL CHANGE STATEMENT WHERE, ESSENTIALLY, I THINK JENSEN IS SAYING TO EVERYONE ELSE THAT HE COMPETES WITH, CATCH ME IF YOU CAN. AND HIS WHOLISTIC VIEW OF THE DATA CENTER ONE LARGE GPU MEANS HE'S NOT ONLY INVESTING IN CORE GPU BUT CPU, THE OVERALL NETWORKING FABRIC, THE CONNECTIVITY AND I THINK IF WE HAD DO WHAT HE HAS DONE IN THE PRIOR DECADE OVER THE COMING DECADE THAT THE GAINS THAT HE WILL OFFER IN THE REDUCTION IN THE COST OF COMMUTE WILL TRULY MAKE A.I. UBIQUITOUS. >> WHAT COMPANIES, CJ, OR WHOLE SECTIONS OF THIS INDUSTRY THEREFORE, ARE EFFECTIVELY DINOSAURS. IF THAT'S WHAT'S HAPPENING AND THEY'RE TAKING OVER THESE OTHER FUNCTIONS AND CREATING A NEW GALACTIC COMPUTING PLATFORMS THERE HAS TO BE NET LOSERS WHO WOULD OTHERWISE GET THIS CAPITAL AND INVESTMENT. >> I THINK BROAD COM DID A JOB TALKING ABILITY NVIDIA'S MAINFRAME STRATEGY OVER BEST OF BREED. I THINK NVIDIA IS SECURING THE TRAINING MARKET BUT THE INFERENCE MARKET WILL HAVE AN OPPORTUNITY FOR MANY OTHER PLAYERS WHETHER IT'S CUSTOM, SILICON BY BROAD COM, MARVEL, OR AMD WITH THEIR OWN GPU. SO I THINK THERE'S A BIG ENOUGH PLAYING FIELD FOR SUCCESS FOR ALL THOSE COMPANIES BUT IF I THINK ABOUT THE COMPANY THAT'S GOING TO GROW THE FASTEST AND HOLD THE DOMINANT SHARE, I CONTINUE TO THINK NVIDIA. >> YOU SAY IN YOUR NOTE, QUOTE, A.I. ROI REMAINS AN ENIGMA TODAY. WHAT DO YOU MEAN BY THAT? WHAT ARE YOU HEARING FROM YOUR CHANNEL CHECKS ON THAT FRONT? >> WHEN YOU STEP BACK AND THINK ABOUT NVIDIA'S DATA CENTER BUSINESS GOING TO A BILLION OR TWO A QUARTER TO $25 BILLION NOW AND MOVING HIGHER OVER THE COMING QUARTERS AND YEARS IT BEGS THE QUESTION WHAT'S THE RETURN ON THIS INVESTMENT. I THINK TODAY WE'RE IN SUCH EARLY INNINGS THAT IT'S GOING TO BE HARD TO SEE. WHAT WE TRIED TO OUTLINE IN OUR NOTE THIS MORNING WAS, YOU KNOW, GIVE CERTAIN USE CASES, WHETHER IT'S IN BIOTECH OR WALMART OR THINGS LIKE THAT. AND IT'S, YOU KNOW -- I'D SAY IT'S THE RIGHTFUL QUESTION MARK BUT I THINK IT'S HAR

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