What to Expect From NVIDIA Earnings

By Chris Lange Updated Jan 13, 1:05PM EST · Published Feb 17, 11:40AM EST

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What to Expect From NVIDIA Earnings — © Thinkstock

NVIDIA Corp. (NASDAQ: NVDA) is scheduled to report its fiscal fourth-quarter financial results after the markets close on Wednesday. The consensus estimates from Thomson Reuters call for $0.32 in earnings per share (EPS) on $1.31 billion in revenue. In the same period of the previous year, it posted EPS of $0.35 and $1.25 billion in revenue.

Many analysts have hopped on the bandwagon with this top tech stock. NVIDIA is one of the leaders when it comes to supplying graphics processing technology for the 3D graphics market, including desktop graphics processors and gaming consoles. It provides the chip used in the 15-inch Macbook Pro and recently announced the Quadro K5000 for the Mac.

NVIDIA also is moving into visual computing chips for cars, mobile devices and supercomputers. It has a technology partnership with electric car maker Tesla. The company has been able to use its ability to leverage past investments, with a more controlled spending structure ahead on unified, which enables strong cash flow that is allowing a focus on capital return, which is currently estimated to be $1 billion next year.

The company recently posted earnings that were way ahead of estimates, and the first quarter outlook implies earnings per share 26% ahead of current consensus. With gaming revenues up 44% year over year, the analysts believe there remains high overall Wall Street skepticism around the company, as most are unaware of the positive dynamics in the PC Gaming and eSports markets.
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A few analysts weighed in on NVIDIA prior to its earnings report:

Wedbush has an Outperform rating and lowered its price target to $30 from $31.
Jefferies reiterated a Buy rating with a $38 price target.
Canaccord Genuity reiterated a Buy rating with a $35 price target.

So far in 2016, NVIDIA has underperformed the broad markets, with the stock down 18% year to date. Over the course of the past 52 weeks, the stock is actually up 23%.

Shares of NVIDIA were trading up 2.8% at $27.75 Wednesday morning, with a consensus analyst price target of $32.04 and a 52-week trading range of $19.09 to $33.94.

About the Author Chris Lange →

Chris Lange is a writer for 24/7 Wall St., based in Houston. He has covered financial markets over the past decade with an emphasis on healthcare, tech, and IPOs. During this time, he has published thousands of articles with insightful analysis across these complex fields. Currently, Lange's focus is on military and geopolitical topics.

Lange's work has been quoted or mentioned in Forbes, The New York Times, Business Insider, USA Today, MSN, Yahoo, The Verge, Vice, The Intelligencer, Quartz, Nasdaq, The Motley Fool, Fox Business, International Business Times, The Street, Seeking Alpha, Barron’s, Benzinga, and many other major publications.

A graduate of Southwestern University in Georgetown, Texas, Lange majored in business with a particular focus on investments. He has previous experience in the banking industry and startups.