Major Bank Ratings | Bank of Communications International: Raises Nvidia Target Price to $260, Increases Revenue and Profit Forecasts for This and Next Fiscal Year

Gelonghui March 2｜Bank of Communications International released a report stating that Nvidia's revenue for the fourth quarter of fiscal year 2026 ending at the end of January this year reached $68.1 billion, higher than the previous guidance median of $65 billion and market expectations. The Non-GAAP gross margin was 75.2%, higher than the previous guidance median of 75%. The bank believes that among these, the network chip revenue of $11 billion, an annual increase of more than 3.5 times, was the biggest highlight. Management guided for first quarter fiscal year 2027 revenue ending at the end of April this year to be $78 billion (+/-2%), with a Non-GAAP gross margin guidance of 75% (+/-50 basis points) for the quarter. Considering the active capacity expansion by TSMC and memory suppliers, as well as Nvidia's leading position in the industry, the bank believes that supply chain tensions have less impact on Nvidia compared to its peers. The bank raised its revenue forecasts for Nvidia for fiscal years 2027 and 2028 to $354.5 billion and $455.7 billion, respectively, and raised its Non-GAAP earnings per share forecasts to $8.06 and $10.52; the target price was raised to $260, corresponding to 28 times the forecast P/E for fiscal years 2027 and 2028, and believes the stock price is attractive.