Nvidia shares saw a slight decline on Monday as the company began trading following a major 10-for-1 stock split. This event led Wall Street analysts to revise their price targets for the tech giant.
Nvidia Stock Split and New Trading Price
Nvidia (NVDA), which recently overtook Apple as the second-largest company by market value, began trading on a split-adjusted basis on the Nasdaq at $120.38 per share. This stock split was announced last month following a strong fiscal first-quarter earnings report, which showed better-than-expected sales and a high demand outlook for Nvidia’s new Blackwell processors. These processors are expected to power the artificial intelligence systems of major companies such as Meta Platforms (META), Microsoft (MSFT), and Amazon (AMZN).
In the stock split, Nvidia shareholders received nine additional shares for every share they owned. The company stated that the goal of this measure was to “make stock ownership more accessible to employees and investors.”
Wall Street analysts adjust price targets
The stock split prompted several adjustments to price targets by Wall Street analysts and raised speculation that Nvidia could soon be added to the Dow Jones Industrial Average as its new price level is more in line with other stocks in the index.
Morgan Stanley’s Joseph Moore: Morgan Stanley analyst Joseph Moore downgraded his rating on Advanced Micro Devices (AMD) to equal weight from overweight and adjusted his price target on Nvidia to $116 per share (split-adjusted). He anticipates that Nvidia may need to reduce prices for its Blackwell processors and other chips to remain competitive.
“Blackwell’s lower prices, increased availability of Hopper chips, and data center power issues could become more important for Nvidia this year and next,” Moore explained. “Our research shows that Nvidia is interested in defending its market share, accelerating its development roadmap and being more aggressive with pricing.”
Susquehanna’s Christopher Rolland: Susquehanna analyst Christopher Rolland raised his price target for Nvidia to $145 per share (split-adjusted). He noted that fears of a sales gap between the launch and delivery of the new Blackwell systems have been alleviated by continued demand for Nvidia’s older H100 Hopper chips.
Barclays’ Blayne Curtis: Barclays analyst Blayne Curtis also raised his price target for Nvidia to $145 per share and revised his current-year revenue forecast by $25 billion to $157.1 billion. Curtis expects Nvidia to benefit from increased sales due to sovereign demand for AI, where governments build data centers to train large language models for state functions. Curtis forecasts full-year earnings of about $3.62 per share for Nvidia.
Speculation on the inclusion of the Dow Jones
The tight stock price has led to speculation that Nvidia could be added to the Dow Jones Industrial Average due to its significant market influence and position as the world’s third-largest company by market value. Intel (INTC), with a market value of $130 billion and a decline of 33% over the past five years, is considered a likely candidate to replace it. S&P Dow Jones Indices has made notable changes to the index before, such as replacing AT&T (T) with Apple in 2015 following Apple’s 7-for-1 stock split.
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