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Morgan Stanley (NYSE:MS) believes Nvidia's (NASDAQ:NVDA) Q4 earnings could send Asian AI stocks soaring by double digits if the chipmaker delivers a revenue beatbut a miss could trigger a selloff, according to a report from Katy Huberty, the firm's global director of research.
With AI-exposed stocks consolidating ahead of earnings season, Huberty noted that Morgan Stanley's Asia Tech analysts see a 3-15% upside for AI names if Nvidia surpasses revenue expectations, while a 5-10% decline is possible if sales disappoint. The report, however, did not specify individual stocks.
Wall Street is expecting Nvidia's Q4 revenue to jump 73% year-over-year to $38.16 billion, with earnings rising 64% to $0.85 per share. The company is set to report results Wednesday after market close.
While Nvidia stock is up 3.45% over the past six months, it has fallen more than 8% in the past month, reflecting market caution ahead of its earnings release.
This article first appeared on GuruFocus.