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Nvidia’s stellar stock rally isn’t over anytime soon, according to Bank of America.
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The bank reiterated its $1,500 price target this week, implying an additional 24% upside for the stock.
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Nvidia will continue to dominate the computing market in the next upgrade cycle, the bank said.
Nvidia Stocks have more room to rise even after their latest rally to record highs, as the chipmaker appears poised to dominate the computer market for years to come, according to Bank of America.
The bank reiterated its “buy” rating on the stock in a note Wednesday, adding that the company led by Jensen Huang remained a first choice in the IT sector. BofA strategists have a 12-month price target of $1,500 per share, implying an additional 24% upside from the stock’s price as of Thursday morning.
“NVDA is best positioned to enable the $3 trillion IT industry to deliver AI services. Despite the claims of its competitors (AMD, Intel, custom chips or ASICs), we see NVDA with a lead of several years in terms of performance, pipeline, incumbent, scale and development support,” the strategists said in the note.
Vivek Arya, senior semiconductor analyst for the bank, added that he believes the stock will dominate the IT market over the next decade. This is because the IT sector is undergoing “multi-decade infrastructure upgrade cycles” and markets are witnessing the start of the next decade-long cycle, Ayra said.
“We think spending could be between $250 billion and $500 billion per year, and Nvidia is leading the charge,” he said. Yahoo finance this week.
Nvidia shares have been unstoppable over the past 18 months, ever since OpenAI released ChatGPT and sparked an artificial intelligence arms race. Nvidia chips are actually the only game in town when it comes to powering the AI models that have captured the attention of consumers and Wall Street investors.
On Wednesday, the stock reached new records, with the the company’s total market capitalization exceeds that of Apple becoming the second most valuable company in the world.
Nvidia stock split 10-to-1 on Friday, a move that could be a catalyst for further gains as the falling stock price helps attract more attention from retail investors.
Bearish calls from Nvidia are rare, although some forecasters doubt the company can maintain its wild growth. The title could possibly experience a slump because it faces falling demand and growing competition in the GPU market, analysts warn.
Read the original article on Business Insider
