Hi guys,
I just asked Grok3 to think hard and give me an estimate of NVDA's price at April 30th 2025. Interesting logic, if nothing else.
I am buying calls in the morning, currently holding about 3000 shares of stock. See it for yourself.
I start with the prompt, followed by the conclusion. read the whole reasoning after.
Prompt:
What is the estimated value of NVDA at end of April. research news, estimate the sales volume based on NVDA's clients most recent earnings reports, compare the estimated sales volume to last quarter.
# Conclusion
* **Estimated NVDA Value**: **$175-$185** by April 30, 2025, driven by strong Q1 revenue ($43 billion) and a 40-50x P/E, tempered by supply and margin risks.
* **Sales Volume**: **300,000-400,000 GPUs** in Q1 FY2026, based on $9-$12 billion from key clients’ AI spending.
* **Comparison**: Up 13%-20% from Q4’s 266,000-333,000 units, fueled by Blackwell’s production scaling.
My NVDA positions:
[Stock](https://preview.redd.it/bz6fy94ngeke1.png?width=1802&format=png&auto=webp&s=652cc8e9e3fb6c0f97fc872e35046f9cfa75b725)
[Active orders for the morning](https://preview.redd.it/itle46a4heke1.png?width=1949&format=png&auto=webp&s=bd786f7095aa796cfc108d9a31517c0160e5cdb5)
# 1. Estimating NVDA’s Stock Value by April 30, 2025
NVDA’s stock price is influenced by revenue growth, earnings, market sentiment, and broader economic conditions. Let’s establish a baseline and project forward:
# Current Price and Trends
* As of February 20, 2025, NVDA’s exact closing price isn’t specified in the prompt or prior context, but posts on X from mid-February (e.g., [u/TheMarketVictor](https://www.reddit.com/user/TheMarketVictor/) on Feb 11) suggest a "fair value" of $150, with bullish technicals. Web reports from late 2024 pegged NVDA at $145.36 (Investopedia, Nov 20, 2024), and it has nearly tripled in 2024, implying a current price likely between $140-$160 post-split (10-for-1 in June 2024).
* For precision, I’ll assume a starting price of $148 (a midpoint approximation), aligning with recent analyst targets (e.g., UBS raised PT to $185 on Nov 11, 2024, per X post [u/BigBullCap](https://www.reddit.com/user/BigBullCap/)).
# Key Drivers for April 2025
* **Earnings Outlook**: NVDA’s Q3 FY2025 (ended Oct 27, 2024) reported $35.1 billion in revenue, beating estimates, with Q4 guidance at $37.5 billion (±2%). Analysts expect Q1 FY2026 (ending April 2025) revenue around $42-$44 billion (X post [u/hhuang](https://www.reddit.com/user/hhuang/), Feb 17). Growth is driven by the Data Center segment (AI chips like Hopper H200 and Blackwell), which hit $30.8 billion in Q3.
* **Client Demand**: NVDA’s major clients—Microsoft, Amazon, Google, Meta, and Oracle—fuel Data Center growth. Their recent earnings (Q4 2024) show aggressive AI infrastructure spending, boosting NVDA chip demand.
* **Market Sentiment**: NVDA’s P/E ratio has hovered around 50-60x forward earnings, reflecting AI hype. X posts (e.g., [u/mukund](https://www.reddit.com/user/mukund/), Feb 19) note UBS’s bullish stance into Q4 earnings (due Feb 26, 2025), expecting strong guidance.
* **Risks**: Supply constraints for Blackwell chips (noted by CFO Colette Kress) and potential gross margin pressure (X forecast [u/hhuang](https://www.reddit.com/user/hhuang/) predicts a Q1 miss at 71.7% vs. 73.2% in Q4) could temper gains.
# Projection
* **Revenue Growth**: Assuming Q1 FY2026 revenue hits $43 billion (midpoint of buy-side estimates), that’s a 15% increase from Q4’s $37.5 billion, driven by Blackwell ramp-up (several billion dollars expected in Q4, per Kress).
* **Earnings**: Q3 FY2025 EPS was $0.81 (non-GAAP). With a stable 73% gross margin and operating expenses rising modestly ($3.4 billion non-GAAP in Q4 guidance), Q1 EPS could reach $0.95-$1.00, implying annualized EPS of $3.80-$4.00.
* **Valuation**: Applying a 50x forward P/E (consistent with 2024 trends), NVDA’s price could range from $190-$200. A more conservative 40x (factoring supply risks) yields $152-$160.
* **Estimate**: Balancing optimism (Blackwell demand) and risks (margin pressure), I estimate NVDA at **$175-$185 by April 30, 2025**, a 18-25% rise from $148. This aligns with UBS’s $185 PT and X sentiment expecting a “strong enough” Q4 report.
# 2. Estimating Sales Volume Based on Client Earnings Reports
NVDA doesn’t report unit sales directly, but we can estimate GPU sales volume via client spending on AI infrastructure, as reported in their latest earnings (Q4 2024, ending Dec 31, 2024, for most).
# Key Clients and Spending
* **Microsoft**: Q2 FY2025 (ended Dec 31, 2024) likely showed Azure revenue growth of 30%+ (per prior trends), with CEO Satya Nadella emphasizing AI investments. Assuming $10-$12 billion in cloud revenue, \~30% ($3-$3.6 billion) may go to NVDA GPUs (H200, Blackwell samples shipped per NVDA’s Q3 call).
* **Amazon (AWS)**: Q4 2024 revenue was likely $30-$32 billion (up 15% YoY), with heavy AI focus. NVDA’s networking ($3.1 billion in Q3) and chips could account for $2-$2.5 billion.
* **Google (Alphabet)**: Q4 2024 ad revenue likely grew 10%, but cloud revenue (Google Cloud) hit $11-$12 billion, with AI capex at $2-$3 billion, much tied to NVDA hardware.
* **Meta**: Q4 2024 capex was projected at $37-$40 billion annually, or $9-$10 billion quarterly, with 24,000 H100 GPUs cited earlier. NVDA likely supplied $1.5-$2 billion.
* **Oracle**: Smaller but growing, Q2 FY2025 (ended Nov 30, 2024) cloud revenue was \~$5 billion, with $0.5-$1 billion to NVDA for AI workloads.
# Sales Volume Estimate
* **Total Client Spend**: Summing conservative estimates, NVDA’s Q1 FY2026 revenue from these clients could be $9-$12 billion.
* **GPU Cost**: H100 GPUs cost \~$25,000-$30,000 each, Blackwell likely higher ($35,000-$40,000). Assuming an average of $30,000 per GPU, $9-$12 billion translates to **300,000-400,000 units** for Q1 FY2026 (Feb-April 2025). This includes H200 and early Blackwell shipments.
# 3. Comparing to Last Quarter (Q4 FY2025)
* **Q4 FY2025 (Nov 2024-Jan 2025)**: NVDA guided $37.5 billion, with Data Center at \~$33 billion (based on Q3’s 88% share). Client spending patterns were similar, but Blackwell was minimal (13,000 samples shipped). Estimating $8-$10 billion from key clients (lower due to H200 dominance), at $30,000 per GPU, this suggests **266,000-333,000 units**.
* **Comparison**: Q1 FY2026’s 300,000-400,000 units vs. Q4’s 266,000-333,000 units shows a **13%-20% increase**. This reflects Blackwell’s ramp-up (Kress: “several billion dollars” in Q4, accelerating in Q1) and sustained H200 demand.
# Conclusion
* **Estimated NVDA Value**: **$175-$185** by April 30, 2025, driven by strong Q1 revenue ($43 billion) and a 40-50x P/E, tempered by supply and margin risks.
* **Sales Volume**: **300,000-400,000 GPUs** in Q1 FY2026, based on $9-$12 billion from key clients’ AI spending.
* **Comparison**: Up 13%-20% from Q4’s 266,000-333,000 units, fueled by Blackwell’s production scaling.