Nvidia (NASDAQ: NVDA) is a company that’s been recognized by Wall Street as the leader of the AI revolution and one of the best performers on the stock market. Therefore, it’s really no surprise that the company and NVDA stock is a source of never-ending debate between analysts and investors alike.
Some people argue that Nvidia’s bullish run has peaked and that it’s all going to be downhill from here, while others see further upside potential in this stock. The recent antitrust charges in France worry over meeting demand give voice to bearish analysts. However, the sentiment is still mainly bullish, and this is made clear by the almost daily updates to price targets from analysts.
Bernstein on NVDA Stock
While many analysts expect the AI boom to move away from Nvidia and start benefiting other companies, we haven’t really seen this happening outside of large caps, and Nvidia has really benefited the most. Indeed, NVDA stock is up more than 150% year to date, and it’s one of the stock market’s top performers this year, despite the multiple pullbacks it saw.
Bernstein analyst Stacy Rasgon is still bullish on NVDA stock, and he wrote in a recent note to customers, advising them to buy the stock. Notably, Rasgon has a $130 price target on NVDA stock, and his bullishness is very significant because he mainly covers semiconductor companies, including Nvidia’s main competitor, AMD (NASDAQ: AMD), but he still favors Nvidia. He’s not the only analyst on Wall Street to be bullish. In fact, Truist (NYSE: TFC) analysts recently revealed that they believe Nvidia still has room to grow, even after it briefly became the world’s most valuable company.
Truist on NVDA Stock
Truist bank recently raised its price target on NVDA stock from $128 to $140, which is a bit more optimistic than Stacy Rasgon’s price target. The bank believes that the runway is just opening up for Nvidia, and the analysts noted that Nvidia becoming the largest company by market cap doesn’t actually affect anticipated returns on investment.
In their analysis of other companies that have grabbed the number-one spot, Truist found that, while firms initially stagnate in their stock performance relative to the S&P 500, the stocks generally outperform the benchmark index over the long term. And so, the analysts maintain their view that Nvidia is the top choice for investing in the artificial intelligence boom, citing the chipmaker’s industry contacts and expanding demand for its GPU architecture.
Keep in mind that while NVDA stock might be pulling back now, it still had a groundbreaking year in 2024, and the company has even added billions to its market cap just six months into 2024. Not for nothing, Nvidia’s quarterly earnings performance has been nothing short of excellent. Indeed, in its April earnings report, the company handily beat revenue, net income, EPS and guidance estimates.
NVDA Stock Forecast
Over the past month, Nvidia has had stock fluctuations. Not only that, but the stock has faltered in recent trading days. Right now, investors are trying to discern whether the company’s valuation has gotten too far ahead of itself, or if the stock is worth what the market says it is.
Regardless, some experts have suggested the decline might be due to AI fatigue or concerns about index concentration. This might be the case, as other AI stocks are falling too. For instance, Super Micro Computer (NASDAQ: SMCI), a seller of servers fitted with Nvidia’s AI chips, fell 8.7%, while competitor Dell (NYSE: DELL) dropped 5.2%. Not only that, but chip designer Arm fell 5.8%, and semiconductor giants Qualcomm (NASDAQ: QCOM) and Broadcom (NASDAQ: AVGO) declined by 5.5% and 3.7%, respectively.
These companies had been major gainers recently, benefiting from heavy investor bets on AI spending. Still, Nvidia stands out as one of the best AI investments out there, in our opinion. And this is because while concerns about AI are valid, skepticism about NVDA stock seems unfounded. The company’s recent earnings report, with record revenues and strong margin growth, reflects sustained high demand. This underlines the genuine excitement and investment in AI.
And even if AI is currently experiencing a setback, it’s too important of a technology to continue pulling back, and will likely see a recovery soon. Let’s not forget that experts are saying that the market for AI technologies is vast, as it was valued at around $200 billion in 2023 and is expected to grow well beyond that to over $1.8 trillion by 2030.
There’s also the fact that even as Nvidia prepares to begin bulk shipments of its new Blackwell AI platform, its H100 and H200 GPUs are still in high demand. That’s because many of Nvidia’s customers have been waiting in line to get these high-strength computing chips needed for training generative AI models. We think that those sales will remain strong even as shipments of the new Blackwell chip accelerate, so investors should still feel comfortable buying Nvidia shares. Even after the massive gains and pullbacks, there is a strong base of sales, and an even stronger pipeline of new AI products ahead.
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