Indeed, Arya details Nvidia’s expansion – or better yet, its evolution – through tie-ins with value-added businesses: I’ll concede, my objection is cogently refuted by Arya’s argument that Nvidia “is no longer a pure-play GPU vendor of old.” At some point (especially when the P/E ratio is heading towards triple digits) we just have to say that enough is enough. Still, I’m having trouble accepting Arya’s $900 price target for NVDA stock. Otherwise, their targets would be lower than the actual share price. Now, I can understand why Wall Street analysts have to raise their price targets when a stock goes up a lot. So, Arya’s bullish call may have been a self-fulfilling prophecy, at least in the very short term. It could even be postulated (without proof) that the issuance of Arya’s price target on NVDA stock actually helped the share price to move up a couple of percentage points. His influence is considerable, to the point that several financial websites reported on Arya’s opinion concerning Nvidia recently. and happens to be a Bank of America managing director and senior analyst. Raising the TargetĪccording to my painstaking research (I looked up his name on LinkedIn), Vivek Arya earned a Ph.D. But then, somebody on Wall Street doesn’t necessarily see it that way. So, what does this mean for investors now? What we have here is a stock that barely pays a dividend, so the shareholders will have to count on price appreciation even after a breathtaking rally. Currently, the forward annual dividend yield is a paltry 0.09%. Incidentally, Nvidia does offer a dividend, but it’s nothing to write home about. For value-focused investors, that might be too hot to handle. From March 8 to June 18, NVDA stock climbed from around $460 to nearly $750.Īnd with that, the stock’s trailing 12-month price-earnings ratio was 88.1. The rally of the past few months has been particularly troubling for the short sellers. Even the onset of the Covid-19 pandemic was little more than a speed bump for Nvidia’s investors. Sure, there were price corrections along the way. Over the long term, NVDA stock has been like a broken elevator that only goes up.
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