Nvidia ( NVDA ) shares closed at a new high on Monday as Wall Street analysts remained firm on their bullish positions on the stock ahead of its November earnings report.
Shares of the leading AI chipmaker rose more than 4% to close at $143.71 per share.
The move comes at a time when Wall Street analysts are reiterating their buy rating on the stock. Citing strong demand for AI, Bank of America (BAC) raised its price target from $165 to $190 on Friday, while investment research firm CFRA last week raised its price target on Nvidia from $139 to $160. Overall, analysts see the stock rising to $148.37 over the next 12 months, according to Bloomberg consensus estimates.
In addition to the growth in the AI market overall, Bank of America analyst Vivek Arya said that Nvidia’s strength in enterprise AI – i.e. its partnerships with companies like Microsoft (MSFT) and Accenture (ACN) – will be a is another factor contributing to its higher price target. Arya said, “NVDA is the partner of choice” for enterprise AI hardware and software.
Wedbush analyst and Nvidia bull Dan Ives echoed that sentiment in a note to investors Sunday, writing that there is “a tidal wave of corporate spending as AI use cases explode,” with Nvidia leading the market.
Ives predicts that the AI infrastructure market will grow tenfold between now and 2027, with companies spending $1 trillion on AI investments over that period.
“In a nutshell, we believe the stage is set for tech stocks to rise another 20% by 2025, as this tech bull market is just entering its next phase led by the AI revolution,” Ives added. “In our view, now that the Fed and Powell have begun their aggressive rate-cutting cycle, a soft landing at the macro level remains the way forward, and AI technology spending remains a generational spending cycle that is just beginning to reach the shores of the tech sector.”
Despite a short-lived decline last week and looming fears of a slowdown in AI spending, Nvidia shares are up nearly 3% in the past week and more than 20% in the past month.
Nvidia CEO Jensen Huang has said there is “insane” demand for its AI chips, which are used in data centers by Big Tech companies to power generative artificial intelligence software. Recent positive news from the company’s industrial partners has also boosted AI stocks across the board, including Nvidia. Micron (MU), which supplies memory chips used in Nvidia’s GPUs, and TSMC (TSM), which produces Nvidia’s AI chips, both beat Wall Street expectations in their recent earnings reports.
The AI chip market is expected to grow 99% by 2024 and another 74% by 2025, according to consultancy International Business Strategies, which tracks industry data.
Still, there’s a chance that even the slightest slowdown in Nvidia’s growth could send the stock lower, as investors have proven hard to please during the latest wave of quarterly reports from Big Tech.
Wall Street analysts, tracked by Bloomberg, expect Nvidia to report third-quarter earnings per share of $0.74, up 84% from last year. They see revenue increase 83% to $33.1 billion.
About 67 analysts have an Outperform rating on Nvidia stock, while seven analysts maintain a Hold rating and only one analyst recommends Selling shares.
Laura Bratton is a reporter for Yahoo Finance. Follow her on X @LauraBratton5.
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