Nvidia's Strategic Moves in China May Boost Stock Value

Nvidia's Strategic Moves May Boost Investor Confidence

Analyst N. Quinn Bolton has recently reaffirmed his Buy rating on Nvidia (NASDAQ: NVDA) while also increasing the price target from $160 to $200. This optimistic projection suggests significant growth potential for Nvidia's stock as it prepares to re-enter a key market.

Resuming Shipments of H20 GPUs

Nvidia has received approval for its export license filings, allowing the company to resume shipping its H20 graphics processing units (GPUs) to China. This approval is significant because it follows earlier export restrictions that had blocked shipments worth $2.5 billion during the first quarter and an additional $8 billion planned for the second quarter. Nvidia's CEO Jensen Huang has highlighted this development as a pivotal moment for the company's international operations.

Financial Predictions Reflecting Market Conditions

Before these export limitations were imposed, Nvidia had successfully generated about $4.6 billion in H20 revenue. However, in response to these challenges, Bolton has adjusted his financial forecasts. He now estimates that Nvidia will achieve around $3 billion in H20 shipments quarterly moving forward, with the potential for previously written-down H20 inventory to yield close to 100% profit margins upon sale.

New Product Launches Targeting Chinese Market

Additionally, Nvidia is expected to launch new Blackwell GPU variants tailored for the Chinese market. The B30 and B40/RTX 6000D variants are projected to deliver about 75% of the performance of the H20 models yet will be priced more competitively between $6,500 and $8,000. These new products are reportedly attracting strong demand, with orders exceeding $1 billion, a promising sign for future revenue streams.

Revenue Estimates Show Positive Trends

In light of these developments, Bolton has raised his revenue estimates significantly. He projects fiscal third-quarter and fourth-quarter 2026 revenues will each increase by $4 billion, establishing fiscal 2027 revenue at $265 billion and earnings per share (EPS) at $6.20. His projections for fiscal 2026 are now $202.6 billion in revenue with an EPS of $4.42, up from previous estimates.

Long-Term Outlook Remains Strong

Interestingly, Bolton has also provided estimates for fiscal 2028, indicating Nvidia’s revenue could reach $315 billion, which includes an anticipated $20 billion from GPU sales for Chinese data centers. According to Bolton, Nvidia's adaptability under current export constraints positions the company well to reclaim lost market share and further entrench itself within the Chinese technology sector.

Market Response and Current Stock Performance

Despite current market fluctuations, NVDA stock is trading slightly lower by 0.40% to $170.02 at the latest check. Investors are closely watching Nvidia's strategic maneuvers, as the company's planned returns to China could yield substantial benefits and elevate its stock price further.

Frequently Asked Questions

What is Nvidia's current price target?

Nvidia's current price target has been raised to $200 by analyst N. Quinn Bolton.

What recent action has enabled Nvidia to ship GPUs to China?

Nvidia received approval for its export licenses, allowing them to resume shipments of their H20 GPUs.

How has Nvidia's revenue outlook changed?

Bolton has significantly increased Nvidia's revenue forecasts, projecting future quarters with billions in additional revenue.

What new products is Nvidia planning for the Chinese market?

Nvidia is launching new Blackwell GPU variants tailored for China, aimed at capturing a larger market share.

How does the market view Nvidia's stock currently?

The market is observing crypto stock fluctuations, with NVDA currently down by 0.40% to $170.02.

About The Author

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