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In this round of technology correction in the US stock market, Nvidia's stock price has fallen by more than 16% in the past month. Despite this, the computing power giant has received strong support from Wall Street bank Morgan Stanley.

On Wednesday local time, Morgan Stanley analyst Joseph Moore and his team released a research report saying that they are optimistic about Nvidia's long-term growth potential and that market concerns about it will ease over time.Morgan Stanley re-rated Nvidia stock as a "preferred stock" while maintaining an "overweight" rating.

Moore's team believes that Nvidia's data center business will continue to contribute most of the company's growth over the next five years, especially in AI/ML (artificial intelligence/machine learning) hardware solutions. With the launch and delivery of the Blackwell super chip, Nvidia is expected to further consolidate its competitive position in the AI ​​field.

Morgan Stanley believes thatThis sell-off could be a great buying opportunity，Sets Nvidia's price target at $144.00, 38.8% above Tuesday's closing price。

Morgan Stanley predicts that by 2027, Nvidia's earnings per share will increase from $1.30 in 2024 to $3.70, and the price-to-earnings ratio will decrease from 51.0 times in 2024 to 29.7 times.

Blackwell

Morgan Stanley said that Blackwell's products have aroused strong interest in the market, especially its significant improvement in reasoning performance, which has further driven customer enthusiasm.

Nvidia has sent Blackwell samples this week. Morgan Stanley pointed out that although the complexity of the product and the rack may bring some challenges, the supply chain is improving well.Initial shipments in the fourth quarter of 2024 are likely to be substantial.

All signs indicate thatBlackwell production increases at strong pace in second half, including the production of racks.
We expect initial shipments to be significant in the fourth quarter, but still believe Hopper will account for the majority of revenue in early 2025.

Morgan Stanley is optimistic that the availability of Blackwell is expected to further consolidate Nvidia's competitive position.

Blackwell is seen as one of the key drivers of Nvidia's future growth, particularly in AI/ML hardware solutions, the company’s visibility is expected to increase as demand shifts from Hopper to Blackwell.
The demand side of the Hopper continues to show strong signs. Hopper production continues to rise, and the transition from H100 to H200 (bringing better HBM3e memory bandwidth and higher memory capacity) has begun.We hear confidence that sales of both products will remain strong.

Although Morgan Stanley is optimistic about Nvidia's prospects, it also points out some potential risks, including the possibility that a weak global economy could affect capital expenditures and that lower AI development costs could lead to increased competition. However, the agency believes that these risks will not affect Nvidia's long-term growth trend.