What happened
Shares of Nvidia (NASDAQ:NVDA) closed Friday more than 2% higher, in contrast to a generally flat stock market. That followed a price target upgrade from one analyst tracking the stock. It also occurred on a good day for cryptocurrencies, which help boost its business.
So what
That upgrade came from Jefferies prognosticator Mark Lipacis, who now believes Nvidia stock is worth $260 per share. That’s nearly $30 higher than his previous price target of $233, and nearly 14% higher than the stock’s current level. Lipacis is maintaining his buy recommendation on the shares.
The analyst believes that Nvidia can rise even higher thanks to its software and data-center business segments. The latter in particular has been making big strides, with revenue rising 35% on a year-over-year basis in the chipmaker’s recently reported second quarter to hit a new record of almost $2.4 billion.
Nvidia also benefited from a cryptocurrency bull market on Friday. Since its GPUs are the product of choice for many crypto miners, its share price can be affected by sentiment in such assets. In late afternoon, the bellwether cryptocurrency Bitcoin was trading just shy of 2% higher — similar to Nvidia’s gain — while Ethereum was up a healthy 4.8%.
Now what
Lipacis certainly has a viable argument for raising Nvidia’s price target. The company has been notching wins in numerous segments of its business. And we should remember that some of the smaller ones, notably the automotive unit, hold big potential.