HomeBusinessNvidia shares are up 38%, according to a Wall Street analyst

Nvidia shares are up 38%, according to a Wall Street analyst

Nvidia (NASDAQ: NVDA) Shares are up 76% year to date, but demand for the company’s data center chips could still support new highs, according to analysts at KeyBanc.

After digging into Nvidia’s supply chain, the company sees evidence of strong demand for Nvidia’s GB200 superchip, designed for artificial intelligence (AI). KeyBanc maintained an Overweight (Buy) rating on the stock, but raised its price target from $1,100 to $1,200, which represents an upside of nearly 38% over the next twelve months from the current share price of approximately $871.

Why Buy Nvidia Stock?

After a year of more than 200% revenue growth, Nvidia’s data center business now represents more than three-quarters of the company’s revenue. The company won’t be able to maintain that level of growth forever, but Wall Street expects revenue to remain robust in the coming years.

See also  There are four reasons why the stock market is poised to continue rising to record highs, says Goldman Sachs

Nvidia has a strong pipeline of new technologies that will increase demand for its industry-leading chips. KeyBanc analysts believe that Nvidia’s GB200 rack computer systems, which bring together the company’s Grace CPUs and Blackwell GPUs, will be in high demand and that average sales prices could be between $1.5 million and $2 million.

All told, Nvidia’s GB200 could generate between $90 billion and $140 billion in annual revenue. This appears to be in line with consensus estimates that call for Nvidia’s total revenue to reach $160 billion by calendar 2026.

Barring anything that could derail the broader recovery in the semiconductor industry, Nvidia shares should hold up and could reach the analyst’s price target within about a year.

Should You Invest $1,000 in Nvidia Now?

Consider the following before buying shares in Nvidia:

The Motley Fool stock advisor The analyst team has just identified what they think is the 10 best stocks for investors to buy now… and Nvidia wasn’t one of them. The ten stocks that survived the cut could deliver monster returns in the coming years.

See also  Palantir is seeing unprecedented demand for artificial intelligence (AI). Why has the stock fallen?

Stock Advisor provides investors with an easy-to-follow blueprint for success, including portfolio building guidance, regular analyst updates and two new stock picks per month. The Stock Advisor service has more than tripled the return of the S&P 500 since 2002*.

View the 10 stocks

*Stock Advisor returns April 8, 2024

John Ballard has positions at Nvidia. The Motley Fool has positions in and recommends Nvidia. The Motley Fool has a disclosure policy.

Nvidia shares are up 38%, according to a Wall Street analyst, originally published by The Motley Fool

- Advertisement -
RELATED ARTICLES

LEAVE A REPLY

Please enter your comment!
Please enter your name here

Most Popular

Recent Comments