Semiconductor titan Nvidia (NASDAQ: NVDA) has been one of the main beneficiaries of the ongoing shift toward artificial intelligence and automation.
Not only is the business one of the top candidates to become the first company to reach a market capitalization of $4 trillion — but major institutional players like Saxo Bank see it reaching a market cap as high as $7 trillion next year.
Nvidia stock has benefited enormously from the company’s cutting edge suit of products — with demand for the latest line of Blackwell chips far outstripping supply.
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However, in recent times, NVDA stock has hit a roadblock in terms of price appreciation. While the last earnings report released by the chipmaker was certainly positive, it would seem like investors expected more outperformance — and aggressive profit taking ensued.
At press time, NVDA shares were trading at $133.68 — although year-to-date (YTD) returns stand at 177.53%, recent price action hasn’t been positive, as the price of an Nvidia share has declined by 4.12% over the course of the last 30 days.
It’s apparent that Nvidia already has, and will continue to have an increasingly hard time impressing investors. Still, there is a very significant silver lining at play that suggests these setbacks are only temporary — major Wall Street firms and almost unanimously bullish on Nvidia stock, and their equity researchers keep on setting increasingly higher price targets.
Those sentiments were reinforced on December 16 when William Stein, CFA, senior technology analyst at Truist Securities reiterated a previous ‘Buy’ rating — while simultaneously significantly increasing his price target.
Truist Securities eyeing $204 mark for Nvidia stock
Up to this point, Truist Securities was operating with a $169 price target on Nvidia stock — a figure that would represent a very impressive 26.4% upside from current stock prices. Stein’s new price target of $204 equates to an upside almost twice as big, at 52.6%.
In a note shared with investors, the equity researcher called Nvidia a ‘home run investment over the last two years owing to AI demand.’
In addition, he noted that Truist expects calendar year 2025 to be another productive period for the company — stating that all relevant industry contacts point to the dominance and superiority of Nvidia’s full technology stack, highlighting software and pre-trained models as particular strong points.
The analyst also noted that demand for the company’s Blackwell line of chips should overwhelm the drag caused by Q3 revenue guidance that was ‘just good rather than great’.
However, the most significant catalyst for this newfound optimism is the fact that Truist expects Nvidia will announce a client-side CPU in 2025. This would open up an additional $35 billion in terms of total addressable market (TAM), providing the business with yet another lucrative avenue and further diversifying revenue streams.
Readers should note that, while similar rumors have surfaced before, Truist’s decision to openly cite the upcoming release as a reason for their bullish stance, coupled with consistent coverage by tech-oriented publications since late October, adds credibility to the as-yet unconfirmed news.
Featured image via Shutterstock
