Nvidia Well Positioned to Benefit From ChatGPT and Other Large Language Models; $200 FVE

Wide-moat Nvidia reported fiscal 2023 fourth-quarter sales consistent with management’s guidance, with gaming slightly ahead of our expectations and data center a bit weaker. We foresee healthy growth for the data center segment, thanks to the firm's newest H100 data center graphics processing unit. The H100 is 9 times faster than its predecessor in artificial intelligence training and up to 30 times faster in AI inferencing for transformer-based large language models like Open AI’s ChatGPT (generative pretrained transformer). We believe AI models like ChatGPT use thousands of GPUs to be trained, with competition among Microsoft, Google, and others supporting our forecast for Nvidia’s data center segment to grow at a 19% CAGR over the next five years.