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Oct. 3, 2022, 2:41 p.m. EDT

Nvidia Stock and Others Like Marvell, AMD, Broadcom, and Credo Are a Buy According to BofA

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Oct 03, 2022 (PressReach.com via COMTEX) -- Nvidia stock was trading at $124.52 as of 01:12 PM EDT

On Monday, Bank of America reiterated its buy ratings for the semiconductor firms: Nvidia stock /zigman2/quotes/200467500/composite NVDA +0.83% , Marvell Technology /zigman2/quotes/200053236/composite MRVL -1.65% , AMD /zigman2/quotes/208144392/composite AMD -0.19% , Broadcom /zigman2/quotes/200646538/composite AVGO -1.39% , and Credo Technology (CRDO). The company did so because it believes that the group will continue to profit from rising cloud computing spending, despite the concerns that have recently begun to surface.

Analyst Vivek Arya revised his estimate for 2023 cloud spending growth, saying he now anticipates it to increase by 7.5%, a slower rate than in 2022 but still higher than in the previous year. Cloud spending is still anticipated to reach $170 billion in 2022, up 20% from 2021, and $183 billion in 2023, which the analyst said would be “in line with the last down cycles when CAPEX decelerated.” The analyst noted that macroeconomic uncertainty has slowed growth, but that spending will still be higher than in previous downturns.

Is Nvidia Stock Still Cheap Enough To Buy?

“Near-term patterns are volatile, but earlier downturns eventually led to multiple years of 30%+ annual spending trends,” Arya said in a note to clients. She added that several new product cycles are probably going to contribute to the growth in spending as well.

While AMD /zigman2/quotes/208144392/composite AMD -0.19% with its Genoa, Bergamo, and Pensando products have also recently been released, Nvidia /zigman2/quotes/200467500/composite NVDA +0.83% is transitioning to 5 nm, and its recently announced Hopper GPU and Grace CPU lines should do well.

While Nvidia’s /zigman2/quotes/200467500/composite NVDA +0.83% Hopper accelerators might also be more expensive than current offers, AMD’s /zigman2/quotes/208144392/composite AMD -0.19% Genoa and Bergamo server chips are anticipated to cost 10% to 15% more than Milan, the company’s current-generation offering.

Customers’ ASICs, Innovium, and Credo’s /zigman2/quotes/200581458/composite CRDO +2.93% Active Electrical Cables, as well as Broadcom’s /zigman2/quotes/200646538/composite AVGO -1.39% Tomahawk 5 switch and Marvell’s /zigman2/quotes/200053236/composite MRVL -1.65% ongoing cloud growth, are also anticipated to perform well. In addition, Arya said that Intel /zigman2/quotes/203649727/composite INTC -0.94% might continue to acquire market share in various end markets for the aforementioned businesses.

The analyst acknowledged that the company “doesn’t have perfect visibility into chip inventory at cloud customers” and that some companies, such as Micron /zigman2/quotes/205710729/composite MU +0.26% , Nvidia /zigman2/quotes/200467500/composite NVDA +0.83% , and Intel /zigman2/quotes/203649727/composite INTC -0.94% , have had “breathtaking” commentary around certain end-markets, but that has primarily been focused on consumer demand.

Still, there are a few factors that support cloud computing spending : The demand for cloud services is still anticipated to climb by more than 30% in 2023; a potential reopening in China could spur demand; the cost of advanced network and accelerator chips is projected to rise, and the total addressable market will keep expanding. According to investment firm Susquehanna, AMD, though operating in a PC market that has continued to deteriorate, is continuing to grow.

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Author: Jowi Kwasu
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COMTEX_415824591/2810/2022-10-03T14:41:03

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$ 161.20
+1.33 +0.83%
Volume: 37.24M
Dec. 7, 2022 4:00p
P/E Ratio
68.58
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0.10%
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$393.28 billion
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$1.27M
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$ 40.41
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0.59%
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$35.06 billion
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$ 70.14
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N/A
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$ 518.50
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3.16%
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/zigman2/quotes/208144392/composite
US : U.S.: Nasdaq
$ 70.14
-0.13 -0.19%
Volume: 59.18M
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P/E Ratio
42.03
Dividend Yield
N/A
Market Cap
$113.30 billion
Rev. per Employee
$1.47M
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/zigman2/quotes/200467500/composite
US : U.S.: Nasdaq
$ 161.20
+1.33 +0.83%
Volume: 37.24M
Dec. 7, 2022 4:00p
P/E Ratio
68.58
Dividend Yield
0.10%
Market Cap
$393.28 billion
Rev. per Employee
$1.27M
loading...
/zigman2/quotes/200467500/composite
US : U.S.: Nasdaq
$ 161.20
+1.33 +0.83%
Volume: 37.24M
Dec. 7, 2022 4:00p
P/E Ratio
68.58
Dividend Yield
0.10%
Market Cap
$393.28 billion
Rev. per Employee
$1.27M
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/zigman2/quotes/208144392/composite
US : U.S.: Nasdaq
$ 70.14
-0.13 -0.19%
Volume: 59.18M
Dec. 7, 2022 4:00p
P/E Ratio
42.03
Dividend Yield
N/A
Market Cap
$113.30 billion
Rev. per Employee
$1.47M
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N/A
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N/A
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$ 518.50
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US : U.S.: Nasdaq
$ 40.41
-0.68 -1.65%
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N/A
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0.59%
Market Cap
$35.06 billion
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/zigman2/quotes/203649727/composite
US : U.S.: Nasdaq
$ 28.33
-0.27 -0.94%
Volume: 28.24M
Dec. 7, 2022 4:00p
P/E Ratio
8.74
Dividend Yield
5.15%
Market Cap
$118.03 billion
Rev. per Employee
$574,236
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$ 53.82
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P/E Ratio
6.96
Dividend Yield
0.80%
Market Cap
$58.36 billion
Rev. per Employee
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loading...
/zigman2/quotes/200467500/composite
US : U.S.: Nasdaq
$ 161.20
+1.33 +0.83%
Volume: 37.24M
Dec. 7, 2022 4:00p
P/E Ratio
68.58
Dividend Yield
0.10%
Market Cap
$393.28 billion
Rev. per Employee
$1.27M
loading...
/zigman2/quotes/203649727/composite
US : U.S.: Nasdaq
$ 28.33
-0.27 -0.94%
Volume: 28.24M
Dec. 7, 2022 4:00p
P/E Ratio
8.74
Dividend Yield
5.15%
Market Cap
$118.03 billion
Rev. per Employee
$574,236
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