HSBC, a prominent financial institution, has recently raised its price target for NVIDIA (NASDAQ:NVDA) shares from $880 to $1,050, reinforcing its Buy rating. This adjustment reflects HSBC’s bullish stance on NVIDIA’s future prospects, particularly in the realm of artificial intelligence (AI).
The catalyst behind HSBC’s optimism is NVIDIA’s upcoming GB200 AI platform, a game-changer in the tech industry. This platform integrates NVIDIA’s cutting-edge Grace Hopper CPU with the B200 AI GPU, marking a significant milestone as the company’s first integration of in-house CPUs.
This strategic move is poised to grant NVIDIA greater control over its product ecosystem, enabling the company to command higher average selling prices (ASP) for its GB200 chip. Analysts project that the ASP for the GB200 chip could range from $60,000 to $70,000, compared to the current standalone B100 GPU priced between $30,000 and $35,000.
Anticipating a surge in demand for NVIDIA’s higher-priced B series GPU and the innovative GB200 product, HSBC has revised its fiscal year 2026 earnings per share (EPS) estimate upward by 18% to $35.30. This adjustment accounts for the expected boost in ASPs and revenue diversification into new markets like software.
The price target of $1,050 is derived from a 30x price-to-earnings (PE) ratio applied to the estimated fiscal year 2026 EPS of $35.30. Additionally, HSBC’s scenario analysis suggests a potential 4% to 11% increase in fiscal year 2026 sales and earnings, translating to an EPS range of $36.58 to $39.15. In this scenario, the stock’s valuation could range from $1,097 to $1,175 under the same 30x PE ratio.
Investors are eagerly awaiting NVIDIA’s GTC conference next week, where the GB200 AI platform is expected to take center stage, potentially driving further gains in the company’s stock price.
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