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Nvidia’s Earnings Report Causes Surge in Stock Prices
Nvidia’s latest earnings report has investors excited, causing the stock to soar more than 29% in extended trading after the May 24 results. The company has already seen huge returns from the buzz surrounding artificial intelligence this year, with a 27% increase since Wednesday. BofA released a note on May 25 stating that Nvidia’s rosy outlook on data centers and AI reaffirms their positive view on the AI server hardware supply chain.
Taiwan’s AI Server-Related Stocks Surge After Strong Results
Several AI-server related stocks in Taiwan surged after Nvidia’s strong results. BofA analysts believe that AI server is one of the most solid/visible drivers for Greater China hardware tech supply-chain. They expect that highly customized design and specifications and stronger computing power of AI servers will boost the value and selling prices of hardware suppliers from 2024.
BofA’s Top 3 Taiwanese Tech Stocks to Buy
BofA analysts have identified three Taiwanese tech stocks that they believe are worth buying based on their positive outlook for the AI server hardware supply chain:
Delta Electronics
BofA notes that there’s still upside for the electronics manufacturer if demand for servers or data centers is stronger than expected, or if electric vehicle-related launches by global brands come faster than anticipated. The bank gave Delta a price target of 365 Taiwanese dollars ($11.90), or about 15% potential upside.
Lite-On Tech
BofA is bullish on shares of this electronic components supplier, which produces parts for the semiconductor industry, among other products. That’s because of rising AI server demand, its increasing sales mix from cloud and the artificial intelligence of things trend. It added that the firm has a solid balance sheet and consistently high cash dividend payout at over 70% since 2011. The bank gave Lite-On Tech a price target of 95 Taiwanese dollars, or about 10% potential upside.
Quanta Computer
BofA said Quanta, which manufactures hardware but has extended its reach to AI applications and cloud computing, now has a better product mix and improving margins. It also has a high cash yield at 7%. It gave Quanta a price target of 125 Taiwanese dollars, or about 10% potential upside.
Conclusion
Nvidia’s strong earnings report and positive outlook for AI server hardware supply chain have caused a surge in stock prices and provided optimism for several AI server-related stocks in Taiwan. BofA analysts have identified Delta Electronics, Lite-On Tech, and Quanta Computer as top Taiwanese tech stocks to buy based on their positive outlook for the companies’ potential growth in the AI server market.
FAQ
What caused Nvidia’s stock prices to surge?
Nvidia’s latest earnings report, with a positive outlook on data centers and AI, caused a surge in stock prices. The company has already seen huge returns from the buzz surrounding artificial intelligence this year, with a 27% increase since Wednesday.
What is BofA’s positive outlook on the AI server hardware supply chain?
BofA analysts believe that AI server is one of the most solid/visible drivers for Greater China hardware tech supply-chain. They expect that highly customized design and specifications and stronger computing power of AI servers will boost the value and selling prices of hardware suppliers from 2024.
Which Taiwanese tech stocks does BofA recommend buying?
BofA analysts have identified Delta Electronics, Lite-On Tech, and Quanta Computer as top Taiwanese tech stocks to buy based on their positive outlook for the companies’ potential growth in the AI server market.
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