Factors affecting Nvidia's (NVDA) target price and earnings projection
The key factor is financial results, which directly depend on how correctly the company chooses innovative areas and how successfully it competes in these areas with other companies.
Within previous years, Nvidia has successfully taken the lead in the gaming CPUs and mining GPUs segment. Now the company relies on the development of artificial intelligence technologies. The main competitors in this area are Marvell Technology, Analog Devices, Qualcomm, Advanced Micro Devices, and Intel. Other corporations, such as Amazon, Alphabet, Microsoft, and Meta Platforms, are also planning to enter the market. Revenue and net income growth against increasing competition is the key to further growth in NVDA shares.
Other influencing factors:
The Fed’s policy. Increasing interest rates could lead to an outflow of money from the stock market, putting pressure on shares of technology companies as well;
Changing demand for GPUs, generative AI programs, etc. Demand remains high, but competition is growing;
Geopolitical factors. These are changes in customs legislation in the countries where the company operates, break of supply chains, problems with hardware delivery, etc.
The speculative mood of investors may also have some influence.