Investors are eagerly awaiting Nvidia ‘s ( NVDA 1.31% ) Nvidia’s quarterly earnings report is scheduled for August 28. After recently dropping to below $100 per share, Nvidia’s stock has risen approximately 30% over the last two weeks.
However, a Wall Street analyst believes further gains are possible. According to a new research report by Melius Research analyst Ben Reitzes, released on Monday, he suggests that investors still have the opportunity to purchase Nvidia stock. He predicts the stock will climb to $160 per share, indicating a potential 23% increase for the advanced semiconductor company’s shares.
Investments in AI will generate significant amounts of free cash flow.
Investing in growth and expansion the application of artificial intelligence (AI) both large and small tech companies have rapidly increased their involvement. Nvidia has emerged as the biggest winner so far. The company’s management anticipates announcing revenue of approximately $28 billion in its forthcoming earnings report, which would represent more than a twofold increase compared to the $13.5 billion reported in the same period last year.
The company has easily surpassed its own revenue predictions in the most recent earnings reports, which might lead investors to anticipate even better results. Whether Nvidia meets or exceeds these expectations, the analyst from Melius Research believes there is ample market potential for the company to capitalize on. rapidly increasing free cash flow soon
In his research report, Reitzes stated that Nvidia “could generate more than $270 billion in free cash flow over the next three years. With this increase in cash flow, the company should be capable of returning a substantial portion of that cash to its shareholders.”
The recent increase in Nvidia’s stock price probably already reflects some positive news anticipated from the upcoming earnings report, so investors shouldn’t automatically expect a surge in shares following the report. However, in the long term, robust net income and cash flow are likely to persist, making it a worthwhile investment.
