Key Highlights
- BMO Capital launched coverage of Nvidia with an Outperform designation and $340 price objective
- The chipmaker earned “top pick” status within BMO’s semiconductor coverage universe
- Analyst highlights Nvidia’s comprehensive AI ecosystem spanning hardware and software
- Production capacity completely reserved for over 12 months ahead
- BMO also assigned Outperform ratings to Broadcom, AMD, Marvell, and Semtech
Nvidia shares were changing hands at $216.18 during Thursday’s session, slipping 0.31%, despite BMO Capital launching coverage with an Outperform designation and an ambitious $340 price objective.
BMO’s Harsh Kumar elevated Nvidia to “top pick” status within an extensive portfolio of semiconductor and quantum computing names the firm began tracking on Thursday.
Kumar highlighted Nvidia’s comprehensive integration of hardware and software capabilities as the primary driver behind this premium designation. The firm identifies a “defensible end-to-end HW/SW moat” that appears underappreciated by current market valuations.
The chipmaker’s shares currently command an 18x forward P/E multiple, which BMO considers attractive given its projections calling for 84% revenue expansion in FY27 and 50% growth in FY28.
BMO drew attention to Nvidia’s upcoming Vera Rubin NVL72 platform, anticipated to scale production during the latter half of this year, representing a significant near-term opportunity.
Customer appetite remains exceptionally robust. BMO observed that a substantial portion of Nvidia’s manufacturing output has already been committed for at least the next year.
The company delivered a gross profit margin of 74% alongside 71% revenue growth over the trailing twelve-month period. Its P/E ratio currently stands at 33.2.
Wall Street Consensus Remains Positive Before Results
BMO’s assessment joins a series of favorable analyst perspectives. Oppenheimer maintains an Outperform stance with a $265 target, emphasizing Blackwell Ultra and VR200 innovations.
Stifel carries a Buy recommendation with a $282 objective, anticipating Nvidia will surpass earnings projections and lift forward guidance. TD Cowen similarly holds a Buy rating at a $275 target.
The company’s upcoming second-quarter financial report will serve as a critical validation point for these optimistic forecasts.
BMO Extends Positive Outlook to Broadcom, AMD, Marvell
BMO distributed favorable ratings throughout the semiconductor sector. Broadcom secured an Outperform rating with a $455 price objective, with BMO positioning it as the second-largest AI infrastructure provider after Nvidia, powered by custom ASIC solutions and networking technology.
AMD earned an Outperform designation alongside a $550 target. BMO highlighted AMD’s Helios rack architecture, which counts OpenAI, Meta, and Anthropic among its primary customers.
Marvell garnered an Outperform rating with a $250 price objective. Semtech similarly received an Outperform designation at a $155 target.
Within the analog segment, BMO assigned Outperform ratings to Analog Devices, Impinj, and Microchip Technology, setting targets at $430, $220, and $95 respectively. The firm indicated analog companies are recovering from post-pandemic inventory adjustments, citing stronger PMI readings, normalized channel inventory, and expanding order backlogs.
D-Wave secured an Outperform rating with a $35 price target in the quantum computing arena.
InvestingPro analytics presently identify Nvidia as trading below intrinsic value according to Fair Value methodology, positioning it among the platform’s top undervalued opportunities. Moody’s assigns Nvidia an Aa1 rating with positive outlook, while S&P maintains an AA issuer credit rating, both reaffirmed after Nvidia’s $105 billion pledge toward an AI data center development in Pike County, Ohio.
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