-
Needham shifted its focus on NVIDIA Corp (NASDAQ: NVDA) and Advanced Micro Devices Inc (NASDAQ: AMD).
-
The stocks exhibited strong secular trends and more muted cyclical exposure, with more attractive valuations amid slowing consumer demand and supply constraints.
-
Needham noted NVIDIA has multiple secular drivers to help buffer them against near-term cycle dynamics.
-
Needham specifed five distinct product cycles over the next year: Hopper, software, gaming, auto, and Grace.
-
In the near term, its supply chain checks indicate that demand from NVDA continues to be strong, with the company prioritizing mix toward higher-value server and datacenter platforms, with PC/graphics a lower priority amid ongoing tight supply conditions.
-
As noted in Needham’s Asia supply chain report, the supply chain is expecting a 40-series GeForce platform launch in the fall.
-
AMD’s recent concern has been client PC industry demand.
-
Needham has strong confidence regarding AMD’s share gains in the data center space, both in the enterprise and the cloud market.
-
Further, Genoa could widen the gap between AMD and Intel Corp (NASDAQ: INTC).
-
Qualcomm Inc (NASDAQ: QCOM) saw bleaker June quarter revenue q/q due to the absence of product launches, while September revenue would be up strongly q/q driven by a resumption of product launches.
-
Checks on iPhones suggest demand has been stable.
-
QCOM appears to be more insulated from China’s smartphone weakness due to its Apple Inc (NASDAQ: AAPL) iPhone exposure, with the supply chain expecting their QCOM business to be up q/q in 2Q.
-
While there has been some investor concern regarding a decline in mmWave content in iPhone 14, Needham’s checks have also suggested stable mmWave content on iPhone 14.
-
QCOM’s non-handset catalysts, the first of which is notebook content, will be more robust in CY23.
-
Needham has a Strong Buy rating on NVDA and QCOM with Outperform rating on AMD.
-
Price Action: NVDA shares traded higher by 0.07% at $212.73 on the last check Monday.
Latest Ratings for NVDA
|
Mar 2022 |
Goldman Sachs |
Reinstates |
Neutral |
|
|
Feb 2022 |
Summit Insights Group |
Downgrades |
Buy |
Hold |
|
Feb 2022 |
Mizuho |
Maintains |
Buy |
View More Analyst Ratings for NVDA
View the Latest Analyst Ratings
See more from Benzinga
Don’t miss real-time alerts on your stocks – join Benzinga Pro for free! Try the tool that will help you invest smarter, faster, and better.
© 2022 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
