Nvidia’s top salesperson in 2018 may be none other than famed filmmaker Steven Spielberg, according to Jefferies.
Spielberg’s upcoming film “Ready Player One” depicts a future dystopia where many retreat into a virtual world, a premise that could drive sales of virtual reality headsets that require high-performance chips, according to Jefferies. The movie will be released in U.S. theaters on March 29 with Spielberg as director.
The film “depicts a dystopian society where people go to school, travel, conduct business and escape into a virtual world called the OASIS, and interact with one another in the OASIS via their avatars,” analyst Mark Lipacis wrote to clients. “We also think that ‘Ready Player One’ has the potential to appeal to an electronics game savvy audience that is motivated to have a more immersive experience.”
Nvidia – the chipmaker with a focus on graphics and artificial intelligence – is one of the most favorite technology stocks on Wall Street. Its stock has climbed nearly 150 percent over the past 12 months, making it the second-best performer in the S&P 500.
The company announced last year its Pegasus artificial intelligence computer system, which will enable fully autonomous robotaxis.
Lipacis, who has a buy rating on the company’s stock, seeing shares climbing to $300 over the next year, implying more than 22 percent upside from Friday’s close. Shares of Nvidia rose 0.6 percent in premarket trading following the Jefferies note.
“The computing paradigm experiences a tectonic shift every 15 years, and that it is currently in a shift to a ‘Parallel Processing – Internet of Things’ model,” the analyst added. “A lot of the demand for increased compute cycles is becoming parallel in nature, like neural networking, gaming, virtual reality and blockchain/cryptocurrency mining.”
To be sure, a surge in demand for VR headsets wouldn’t benefit Nvidia exclusively, Lipacis explained. He also highlighted rival chipmaker Advanced Micro Devices as a possible beneficiary of a Spielberg success.
The analyst has a buy rating and a $19 price target on shares, implying 62 percent upside. Shares rose 0.7 percent in premarket trading.