Creator of graphic chips Nvidia (NVDA) announced a four-to-one stock split on Friday, just days before releasing its first quarter tax results. Nvidia stock jumped on the news.




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The Santa Clara, Calif., Based company said the equity division would make its shares more accessible to investors and employees. Nvidia’s board of directors has approved the stock split, but it has yet to be approved by shareholders at the company’s annual meeting on June 3.

If approved, each registered shareholder of Nvidia at the close of business on June 21 will receive three additional common shares for each share held. Nvidia stock will begin trading on the adjusted split basis on July 20.

On the stock market today, Nvidia shares rose 2.6% to 599.67. Earlier in the session it climbed to 4.2% to 608.88. On Thursday, Nvidia stock jumped 3.9% to 584.50 as semiconductor stocks rallied.

Nvidia’s revenue increased 82%

Nvidia plans to release its first quarter tax results on Wednesday evening. Analysts expect the company to earn $ 3.27 per share on sales of $ 5.39 billion in the quarter ended May 2. That would represent year-over-year growth of 82% in profits and 75% in sales.

On its Investor Day on April 12, Nvidia said its first-quarter revenue was higher than the $ 5.3 billion forecast it provided on February 24.

Wedbush Securities analyst Matt Bryson reiterated his outperformance rating on Nvidia stock Friday with a 12-month price target of 640.

In a note to customers, Bryson said he expects Nvidia to post strong first quarter results thanks to sales of PC graphics processors.

“Our thesis remains unchanged as we continue to believe that Nvidia will achieve long-term outperformance linked to its leadership in AI and games,” said Bryson.

Nvidia Stock tied for third place in the group

On Thursday, Oppenheimer analyst Rick Schafer maintained his outperformance rating on Nvidia stock with a 12-18 month price target of 700.

He sees first quarter benefits from video games and cryptocurrency. But a tight supply will limit that potential for increased sales, Schafer said in his note to customers. He expects supply constraints to persist until the end of the year.

Nvidia stock is tied for third place in IBD’s industry group of factory-less chipmakers, according to IBD Stock Checkup. It has an IBD Composite Rating of 85 out of 99. The IBD Composite Rating combines five separate proprietary ratings into one easy-to-use rating. The best growth stocks have a composite rating of 90 or higher.

Nvidia stock is on the stock list of IBD’s ranking.

Follow Patrick Seitz on Twitter at @IBD_PSeitz for more stories on consumer technology, software, and semiconductor inventory.

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