NVIDIA (NVDA)’s Guidance Could Be “Messy,” Bank Says

With NVIDIA Corporation (NASDAQ:NVDA) due to report its first-quarter results and provide Q2 guidance on May 28, Bank of America warned recently that its outlook could be “messy.”

However, the bank kept a $160 price target and a Buy rating on the shares. Moreover, the bank continues to identify the tech giant as “a top pick.”

Potentially “Messy” Guidance

The chip maker’s Q2 revenue guidance could be “as low as $41 billion,” well below analysts’ average outlook of about $46 billion, according to the bank. Further, its Q2 earnings per share outlook may come in at 85 cents, which is about 16% below the mean estimate, the bank warned.

NVIDIA Corporation (NASDAQ:NVDA) will be hurt in the near term by Washington’s restrictions on its exports to China, the bank noted.

Why Bank of America Remains Very Bullish on NVIDIA Corporation (NASDAQ:NVDA)

The tech giant has  “unique..leverage” to the proliferation of AI, according to the bank. Further, its revenue from China could rise meaningfully as it launches new offerings for the Asian country, Bank of America believes.

While we acknowledge the potential of NVDA as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than NVDA and that has 100x upside potential, check out our report about this cheapest AI stock.

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Disclosure: None. This article is originally published at Insider Monkey.