Nvidia (NASDAQ: NVDA) has been the stock market superstar in 2024 as it built upon the staggering success it has been enjoying since the start of the artificial intelligence (AI) boom in late 2022.
Over the course of the two years, the semiconductor giant has seen its market capitalization grow by approximately $2.5 trillion, effectively increasing sixfold compared to its October 2022 valuation.
The rise has continued throughout 2024 – even once the months of sideways trading that started with the June 10-for-1 stock split are accounted for – and NVDA shares are, following a rally in the extended session started at the market’s close on Friday, October 11, 181.28% in the green in the year-to-date (YTD) chart.
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Considering that Nvidia stock price today, at press time on October 14, stands at $135.49, the chipmaker has also reached a new all-time high (ATH).
AI sets NVDA stock price for the end of 2024
Given all the activity on the stock market and business side, one of the most popular AI platforms, ChatGPT-4o, has assessed Nvidia positively.
ChatGPT highlighted the chipmaker’s central role in the ongoing technological boom, its strong products, such as the Blackwell chip, and its impressive financials.
Despite acknowledging that the rise that has already been achieved gives some cause for concern if NVDA can sustain a continued massive upside, the AI concluded that between the strong demand, partnerships, and cutting-edge advancements, it is reasonable to expect the shares will hit $145 by the end of 2024.
Still, the AI explained that there is some room for unexpected volatility stemming from possible advances among Nvidia’s competitors and from broader economic considerations.
Why Nvidia stock is trading at ATH
All in all, there is no shortage of factors that have helped NVDA stock rally nearly 200% in 2024, and the shares’ stellar success is hardly surprising.
The semiconductor giant has maintained the reputation of a premium chipmaker, offering some of the most advanced units in the world. However, compared to its biggest competitor, Advanced Micro Devices (NASDAQ: AMD), its products have also historically been priced steeply.
Both its reputation and its investments in innovation have made Nvidia a household name during the AI boom, with investors and analysts alike seeing it as the cornerstone of the hoped-for technological revolution.
Nvidia has only built upon this reputation through several innovations, partnerships, and announcements over the years.
What lies ahead for Nvidia stock?
The most recent – and one of the most successful, given that Nvidia CEO Jensen Huang described the demand as ‘insane’ – was the revolutionary Blackwell chip, which is already included in the infrastructure of multiple companies and is expected to enter mass production before the end of the year.
Huang also offered a glimpse into Nvidia’s plans earlier in October when he explained that the firm plans to make Blackwell-like revolutions for AI infrastructure every year.
In a more formal capacity, the semiconductor giant provided its vision for the future during the October AI event held in Washington, D.C.
During the event, Nvidia highlighted its software and hardware advancements and the need for better networking as artificial intelligence models move from a focus on training toward reasoning capabilities – the so-called inference.
Simultaneously, the chipmaker offered real-world use cases for the technology, such as Lockheed Martin’s (NYSE: LMT) advanced target processing and Siemens’ (ETR: SIE) use of AI for complex simulations.
Nvidia bulls and bears: Can NVDA stock sustain its growth?
Looking forward, it is difficult to formulate a bear case for Nvidia stock. Indeed, the company boasts an exceptionally strong track record and is backed by investor confidence and enthusiasm.
This fact is well-reflected in the continued expert bullishness and positive ratings, with some – like Ben Reitzes from Melius Research – still estimating that NVDA shares are cheap compared to their growth potential.
Specifically, as FInbold reported on October 8, Reitzes explained that the activity surrounding AI is expected to ‘perk up’ further toward the end of 2024 and that Nvidia will remain central to the boom.
Indeed, the chipmaker’s role is also evident in its role in the massive $30 to $100 billion AI infrastructure investment project – led most notably by Microsoft (NASDAQ: MSFT) and BlackRock (NYSE: BLK) – in which Nvidia is to serve as an expert advisor.
Finally, some fears about a potential pullback following the major rally have been alleviated by the period of sideways trading and corrections that Nvidia has been experiencing since June and had, judging by the most recent performance, exited in October.
This does not mean, however, that Nvidia’s rally will be guaranteed. Its staggering rise is mostly linked to the broader AI boom, which, while strong at press time, has been considered a major and dangerous bubble by many prominent experts.
Furthermore, Huang’s plans for annual infrastructure revolutions could prove a double-edged sword. Historically, many firms that tried to excite investors and customers with yearly launches have simultaneously suffered significant losses in the quality of each release cycle.
