In the wake of the unparalleled artificial intelligence (AI) frenzy that engulfed the tech world in 2023, Nvidia (NASDAQ: NVDA), renowned for crafting some of the most advanced computer chips, emerged as an unequivocal success story. The company left investors astounded by its performance, revealing quarterly earnings that exceeded even the loftiest Wall Street projections.
In May 2023, Nvidia reported a staggering quarterly profit exceeding $2 billion, accompanied by revenue surging to an impressive $7 billion, far surpassing expectations.
Nvidia’s unique position in the AI landscape sets it apart, with its powerful graphics processing units (GPUs) acting as the linchpin for large-scale data processing and generative AI models like ChatGPT. Notably, the company reportedly commands an 80% share of the GPU market.
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These GPUs are purpose-built for the intricate mathematics integral to AI computations, in stark contrast to the more generalized central processing units offered by companies like Intel (NASDAQ: INTC).
This distinctive market position propelled Nvidia into the rarefied air of trillion-dollar companies earlier in the year, as its stock price more than tripled since the start of 2023.
Wall Street’s projections on NVDA
While some may think that NVDA’s eye-popping 2023 ascent made it an overvalued stock poised for correction, Wall Street analysts are not likely to agree with those views.
In fact, they believe the chipmaker can witness further upside in the months ahead.
Based on 38 analysts’ projections issued in the past three months, the consensus 12-month forecast for Nvidia’s shares currently stands at $650.53, implying over 41% upside from its current level, according to TipRanks.
Furthermore, the stock has an average rating of a ‘Strong Buy,’ based on 37 ‘Buy’ and 1 ‘Hold’ recommendations the analysts offered in the previous three months. Notably, none of the analysts recommend to sell the stock.
TD Cowen strategists see 50% more upside in NVDA
Compared to the aforementioned average price target, one Wall Street analyst recently offered an even more bullish prediction last week.
Namely, TW Cowen strategist Matthew Ramsay and his team of analysts reiterated their Outperform rating on NVDA and hiked the price target on the stock from $600 to $700.
“We believe the industry is in the early innings of two transformational paradigm shifts toward ubiquitous acceleration and generative artificial intelligence, with Nvidia’s wide moat potentially expanding.”
– analysts wrote.
Nvidia’s stock was down 0.7% at $457 in the premarket trading on Tuesday.
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