Raymond James upgrades Nvidia: time to buy?

Equity research firm Raymond James joined a host of other analysts with a buy rating on Nvidia Corp (Nvidia) shares. The company upgraded NVDA stock from an equal weight rating to overweight citing "hyperscale digestion, a resumption of enterprise activity, and rising virtualisation," as the reason behind their upgrade. The stock price has more than doubled over the last 12 months and is up 45% this year. But analysts think there is more room left to run. 

Fundamentals overview: Nvidia has exciting growth prospects

From a fundamental perspective, NVDA stock seems significantly overvalued based on the P/E ratio of 90.25. However, its forward P/E of 43.95 suggests a high earnings growth expectation. 

Analysts expect Nvidia EPS to grow by 52.50% this year. This growth beds well with Raymond James’ view of expedited growth driven by a resumption of enterprise activity and a rising virtualisation market.

Technical overview: the bull-run has momentum

NVDA shares extended gains to overbought levels of the 14-day RSI. The current bull-run seems to have solid momentum. Therefore, investors betting on the Nvidia share price to continue rising can target profits at approximately $800.00 and $850.00. The key support levels are $700.00 and $647.30.

Bottom line: Nvidia is still an exciting buy

In summary, Nvidia stock still looks attractive, even at the current valuations. The company seems poised for solid earnings growth this year. Therefore, investors can target extended gains or short-term pullbacks ahead of an exciting period.