Out of the Gate: Nvidia shares up after 1Q results, upgrade
NEW YORK—Shares of Nvidia Corp. rose Friday morning after the graphic chip maker posted a 34 percent jump in first-quarter profit that missed Wall Street's estimates, but led an analyst to boost his rating.
The stock rose 14 cents to $22.09 after the opening bell.
Stifel Nicolaus & Co. analyst W. Blake Fischer raised his rating to "Buy" from "Sell," bypassing the "Hold" rating.
While results were "lackluster," expectations for share loss, margin growth and new products should improve through the year, he said.
"We believe further downside risk is limited, and is outweighed by the potential for an improving outlook for the company's earnings ability," Fischer said in a note to clients.
Fischer's $26 price target implies he expects the stock to rise 19 percent over Thursday's $21.95 close.
He now expects fiscal 2009 earnings of $1.57 per share on revenue of $4.92 billion, compared with a previous estimate of $1.69 per share earnings on revenue of $4.72 billion.
Analysts polled by Thomson Financial expect, on average, earnings of $1.66 per share on revenue of $4.76 billion.
