Nvidia's latest blowout earnings report is good news for many other tech stocks. The leading maker of artificial intelligence processors announced better-than-expected first-quarter earnings and stronger-than-expected guidance, declared a 10-for-1 stock split, and raised its dividend. The strong results bode well for many other companies riding the AI bandwagon or with specific ties to Nvidia. For Super Micro Computer, Bank of America analyst Ruplu Bhattacharya sees multiple growth opportunities ahead. And continued strong AI-related demand beyond cloud services could be a big catalyst. “In our view, perhaps the biggest takeaway from Nvidia's F1Q25 earnings report is that demand for AI-related accelerated computing remains strong and is extending beyond cloud service providers to consumer internet companies, enterprise and sovereign AI,” Bhattacharya told clients. “In our opinion, Supermicro is well positioned to benefit from this growing demand.” Bhattacharya said Supermicro is well positioned for smaller cloud service providers to expand globally given the strong demand. It is also in talks with sovereign groups looking for partners to make the most of AI on the hardware side. Supermicro has already had a monster year, surging more than 211% in 2024 after rising 246% last year. Despite that, Wall Street still thinks the stock has room to rise. The average analyst surveyed by FactSet has a “buy” rating and price target suggesting the stock could rise nearly another 15%. SMCI YTD Mountain Super Micro, Year-to-date Taiwan Semiconductor are also well positioned to benefit from NVIDIA's report, according to Bank of America analyst Brad Lin. Taiwan Semiconductor, which he called an “enabler of generative AI” as an integrated circuit and packaging supplier, should benefit from the high demand. Nvidia's strong forward guidance is a particularly good sign, Bank of America argued.Lin also noted that Nvidia's increasing focus on energy efficiency could strengthen Taiwan Semiconductor's position in the industry. “We are encouraged to study the robust cloud AI outlook shared by Nvidia,” Lin wrote to clients. Citigroup analyst Laura Chen told clients she expects Taiwan Semiconductor's “strong momentum to continue” following Nvidia's latest earnings. Taiwan Semiconductor's U.S. shares have risen 52% in 2024. The majority of analysts surveyed by FactSet rate the stock a buy, and their average price target suggests the stock could rise more than 3% over the next year. Citi analyst Asia Merchant said Dell can now tout its bullish predictions for AI on its earnings call later this month. Dell, which announced an AI factory partnership with Nvidia this year, is also likely to show “indomitable spirit” to expand market share through full-stack products, the analyst said. “Overall, we believe the diversity of end markets and the expanding customer base deploying AI infrastructure support our positive view on Dell,” Merchant said. Dell shares have more than doubled in 2024. While most analysts rate it a buy, the general price target reflects the possibility of a decline of 7% or more, according to FactSet data. Stifel analyst Tore Svanberg sees two main groups as winners from the Nvidia report: those with more exposure to data centers and those focused on the intersection of AI and automotive. For the former, he names Astera Labs, Credo Technology, Marvell Technology, MACOM Technology Solutions, and Monolithic Power Systems as winners given their high exposure. Maxlinear and Semtech are likely secondary beneficiaries, Svanberg said. In the automotive space, analysts named NXP Semiconductors, ON Semiconductor, Ambarella, and Texas Instruments as stocks that will benefit. Analog Devices, Monolithic Power Systems and Microchip Technology are likely runners-up.
