Nvidia Stock Surges Amid AI Boom: Analysts Weigh In on Future Prospects

Why Nvidia Stock Is Jumping Today

Nvidia (NASDAQ: NVDA) stock is jumping in Monday's trading. The artificial intelligence (AI) leader's share price was up 4.1% as of 1:30 p.m. ET, according to data from S&P Global Market Intelligence. Nvidia stock is gaining ground today thanks to news that it's developing a new, high-performance AI processor for the Chinese market. The stock is also getting a boost thanks to bullish coverage from analysts. Nvidia's strategy in China has huge implications Reuters published a report this morning suggesting that Nvidia is designing a new offshoot variant of its most powerful graphics processing unit (GPU) for the Chinese market. Shipments of the B20 chip and related processor technology are expected to begin in China in the second quarter of 2025. Concerns about Nvidia's ability to sell advanced processors in the country due to restrictions enacted by the U.S. and other allies have been dragging on the company's stock recently. In addition to potentially creating a sizable short-term revenue stream, the move also signals that Nvidia does not appear to pivoting from China -- one of the largest markets for its hardware and services. Wall Street bulls are weighing in on Nvidia In a note published this morning, Piper Sandler analyst Harsh Kumar raised his one-year price target on Nvidia stock from $120 per share to $140 per share. The firm's lead analyst on the company cited favorable business trends and the launch of the AI leader's new Blackwell chip platform in October as catalysts for the increase. The first Blackwell processors are expected to deliver major leaps in performance over Nvidia's current high-end chips, which are already best-in-class. Loop Capital also published a bullish note on Nvidia stock, reiterating its buy rating and raising its one-year price target from $120 per share to $175 per share. Analyst Ananda Baruah thinks the company could be on track to deliver revenue from its data center segment that far exceeds Wall Street's expectations. Baruah thinks that data center revenue for 2025 could come in between $215 billion and $240 billion, while the average analyst estimate calls for sales of $145 billion. The analyst also thinks that sales for the compute segment could hit between $200 billion and $225 billion, ahead of Wall Street's target for sales of $132 billion. The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now... and Nvidia wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $722,626!* Stock Advisor provides investors with an easy-to-follow blueprint for success, including guidance on building a portfolio, regular updates from analysts, and two new stock picks each month. The Stock Advisor service has more than quadrupled the return of S&P 500 since 2002*. Keith Noonan has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Nvidia. The Motley Fool has a disclosure policy. The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Why Nvidia Stock Is Jumping Today | The Motley Fool

Nvidia stock is gaining ground today thanks to news that it's developing a new, high-performance AI processor for the Chinese market. The stock is also getting a boost thanks to bullish coverage from analysts. Reuters published a report this morning suggesting that Nvidia is designing a new offshoot variant of its most powerful graphics processing unit (GPU) for the Chinese market. Shipments of the B20 chip and related processor technology are expected to begin in China in the second quarter of 2025. Concerns about Nvidia's ability to sell advanced processors in the country due to restrictions enacted by the U.S. and other allies have been dragging on the company's stock recently. In addition to potentially creating a sizable short-term revenue stream, the move also signals that Nvidia does not appear to pivoting from China -- one of the largest markets for its hardware and services. In a note published this morning, Piper Sandler analyst Harsh Kumar raised his one-year price target on Nvidia stock from $120 per share to $140 per share. The firm's lead analyst on the company cited favorable business trends and the launch of the AI leader's new Blackwell chip platform in October as catalysts for the increase. The first Blackwell processors are expected to deliver major leaps in performance over Nvidia's current high-end chips, which are already best-in-class. Loop Capital also published a bullish note on Nvidia stock, reiterating its buy rating and raising its one-year price target from $120 per share to $175 per share. Analyst Ananda Baruah thinks the company could be on track to deliver revenue from its data center segment that far exceeds Wall Street's expectations. Baruah thinks that data center revenue for 2025 could come in between $215 billion and $240 billion, while the average analyst estimate calls for sales of $145 billion. The analyst also thinks that sales for the compute segment could hit between $200 billion and $225 billion, ahead of Wall Street's target for sales of $132 billion.

Up 145% So Far This Year, Here's What It Will Take for Nvidia Stock to Drop, and Why I Think It Could Happen Sooner Rather Than Later

The technology sector has been one of the best-performing industries so far this year largely thanks to rising euphoria around artificial intelligence (AI). Megacap technology behemoths have been the biggest beneficiary of the AI movement, and one stock in particular is having a bit of a moment right now. Shares of semiconductor darling Nvidia (NASDAQ: NVDA) are up a whopping 145% so far in 2024 -- making it the top performer of the "Magnificent Seven" by a wide margin. Considering the AI revolution is very much in its early days, there are many reasons to believe that Nvidia's best days are ahead. However, smart investors understand that stocks don't appreciate in value forever. Let's dig into what the future could hold for Nvidia, and what it will take for the outsize momentum to normalize. Nvidia's chips are in high demand, but... Graphics processing units (GPUs), a type of semiconductor chip, have become some of the most in-demand products in the AI realm right now. GPUs are currently being deployed across a number of generative AI applications in robotics, autonomous driving, training large language models (LLMs), machine learning, and more. At the moment, Nvidia is widely considered to be the market leader in GPU technology. The company's A100 and H100 chips are used by some of the world's largest businesses, including Tesla and Meta Platforms. Moreover, the pace at which Nvidia is innovating is equal parts inspiring and impressive. Earlier this year, the company showed off its next-generation chips, known as Blackwell. According to management, demand for Blackwell is already outpacing supply -- a good indication that promising business results will continue. While much of Nvidia's sales and profits can be tied to the company's chip business, it's important for investors to realize that a fair amount of competition is on the horizon. Nvidia's closest direct competitors are Advanced Micro Devices and Intel. While each of these companies are much smaller than Nvidia, I see one big reason why their respective businesses could begin to experience some momentum. Namely, investors should be paying close attention to Nvidia's supply-and-demand trends. On the surface, rising demand can be considered a positive. In essence, when businesses witness surging demand for products and services, they can attain lucrative pricing power. This can help accelerate sales while also serving as a catalyst for abnormally high margin expansion. Subsequently, soaring profits and cash flow tend to be the net result -- which helps companies reinvest into the business and other growth initiatives. This is precisely what is going on with Nvidia right now. There is one drawback to outsize demand, though. If demand is so high that companies are having trouble fulfilling backlog, customers will begin looking for alternative solutions. Considering demand for Nvidia's Blackwell GPUs is already outpacing supply capacity, I think this is where AMD and Intel can make a move. In addition to AMD and Intel, Nvidia also has a number of tangential competitors. Amazon may be best known for its e-commerce marketplace and cloud computing infrastructure, but the company has several other opportunities that could pose a threat to Nvidia. In particular, as part of its deals with AI start-ups Anthropic and Hugging Face, Amazon will be integrating more of its own homegrown training and inferencing chips into its cloud services. This exact strategy is taking shape at Meta as well. While Meta is currently a big user of Nvidia GPUs, the company hasn't been shy about its own ambitions. Similar to Amazon, Meta is developing its own chip -- dubbed Meta Training and Inference Accelerator (MTIA). The underlying thesis for the MTIA chip is that it can help Meta internalize more of its technology stack and rely less on external vendors. In theory, this could lead to significant cost savings in the long run while also opening up new revenue opportunities. The bottom line Considering Nvidia's lead in the GPU space and its unparalleled pricing power, the company is experiencing a unique period of accelerating revenue and profits. However, there are a number of direct and indirect competitors emerging that I think will take a toll on Nvidia's chip business. For this reason, I think it's highly likely that Nvidia will eventually lose its pricing power and experience a slowdown in revenue growth. Ultimately, if Nvidia begins to experience decelerating sales, the company's margins should contract and profits will likely start to decline as well. While I do not think Nvidia will suddenly experience some sort of existential crisis, it's reasonable to say that the company cannot thrive on its GPU business forever. Investors looking at chip stocks may want to consider some of the alternatives explored above, as many of these businesses remain underappreciated in the broader chip realm. The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now... and Nvidia wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $722,626!* Stock Advisor provides investors with an easy-to-follow blueprint for success, including guidance on building a portfolio, regular updates from analysts, and two new stock picks each month. The Stock Advisor service has more than quadrupled the return of S&P 500 since 2002*. John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool's board of directors. Adam Spatacco has positions in Amazon, Meta Platforms, Nvidia, and Tesla. The Motley Fool has positions in and recommends Advanced Micro Devices, Amazon, Meta Platforms, Nvidia, and Tesla. The Motley Fool recommends Intel and recommends the following options: long January 2025 $45 calls on Intel and short August 2024 $35 calls on Intel. The Motley Fool has a disclosure policy. The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Up 145% So Far This Year, Here's What It Will Take for Nvidia Stock to Drop, and Why I Think It Could Happen Sooner Rather Than Later | The Motley Fool

The technology sector has been one of the best-performing industries so far this year largely thanks to rising euphoria around artificial intelligence (AI). Megacap technology behemoths have been the biggest beneficiary of the AI movement, and one stock in particular is having a bit of a moment right now. Shares of semiconductor darling Nvidia (NVDA -2.61%) are up a whopping 145% so far in 2024 -- making it the top performer of the "Magnificent Seven" by a wide margin. Considering the AI revolution is very much in its early days, there are many reasons to believe that Nvidia's best days are ahead. However, smart investors understand that stocks don't appreciate in value forever. Let's dig into what the future could hold for Nvidia, and what it will take for the outsize momentum to normalize. Graphics processing units (GPUs), a type of semiconductor chip, have become some of the most in-demand products in the AI realm right now. GPUs are currently being deployed across a number of generative AI applications in robotics, autonomous driving, training large language models (LLMs), machine learning, and more. At the moment, Nvidia is widely considered to be the market leader in GPU technology. The company's A100 and H100 chips are used by some of the world's largest businesses, including Tesla and Meta Platforms. Moreover, the pace at which Nvidia is innovating is equal parts inspiring and impressive. Earlier this year, the company showed off its next-generation chips, known as Blackwell. According to management, demand for Blackwell is already outpacing supply -- a good indication that promising business results will continue. While much of Nvidia's sales and profits can be tied to the company's chip business, it's important for investors to realize that a fair amount of competition is on the horizon. Nvidia's closest direct competitors are Advanced Micro Devices and Intel. While each of these companies are much smaller than Nvidia, I see one big reason why their respective businesses could begin to experience some momentum. Namely, investors should be paying close attention to Nvidia's supply-and-demand trends. On the surface, rising demand can be considered a positive. In essence, when businesses witness surging demand for products and services, they can attain lucrative pricing power. This can help accelerate sales while also serving as a catalyst for abnormally high margin expansion. Subsequently, soaring profits and cash flow tend to be the net result -- which helps companies reinvest into the business and other growth initiatives. This is precisely what is going on with Nvidia right now. There is one drawback to outsize demand, though. If demand is so high that companies are having trouble fulfilling backlog, customers will begin looking for alternative solutions. Considering demand for Nvidia's Blackwell GPUs is already outpacing supply capacity, I think this is where AMD and Intel can make a move. In addition to AMD and Intel, Nvidia also has a number of tangential competitors. Amazon may be best known for its e-commerce marketplace and cloud computing infrastructure, but the company has several other opportunities that could pose a threat to Nvidia. In particular, as part of its deals with AI start-ups Anthropic and Hugging Face, Amazon will be integrating more of its own homegrown training and inferencing chips into its cloud services. This exact strategy is taking shape at Meta as well. While Meta is currently a big user of Nvidia GPUs, the company hasn't been shy about its own ambitions. Similar to Amazon, Meta is developing its own chip -- dubbed Meta Training and Inference Accelerator (MTIA). The underlying thesis for the MTIA chip is that it can help Meta internalize more of its technology stack and rely less on external vendors. In theory, this could lead to significant cost savings in the long run while also opening up new revenue opportunities. Considering Nvidia's lead in the GPU space and its unparalleled pricing power, the company is experiencing a unique period of accelerating revenue and profits. However, there are a number of direct and indirect competitors emerging that I think will take a toll on Nvidia's chip business. For this reason, I think it's highly likely that Nvidia will eventually lose its pricing power and experience a slowdown in revenue growth. Ultimately, if Nvidia begins to experience decelerating sales, the company's margins should contract and profits will likely start to decline as well. While I do not think Nvidia will suddenly experience some sort of existential crisis, it's reasonable to say that the company cannot thrive on its GPU business forever. Investors looking at chip stocks may want to consider some of the alternatives explored above, as many of these businesses remain underappreciated in the broader chip realm.

Prediction: 2 Artificial Intelligence Stocks That Could Be Worth More Than Nvidia 5 Years From Now

Nvidia is significantly larger than almost every company in the world. However, that doesn't mean it will necessarily stay that way. A lot can happen over five years, and I think two companies will pass Nvidia in size over the next five years: Alphabet (NASDAQ: GOOG) (NASDAQ: GOOGL) and Amazon (NASDAQ: AMZN). Both happen to be involved in artificial intelligence (AI) as well, and I think they make for better buys than Nvidia right now. Nvidia's lead over these two isn't insurmountable First, let's figure out how much of a head start Nvidia has on these two companies. While Nvidia is third in the world's largest company race, Alphabet and Amazon are fourth and fifth, respectively. So, predicting these two will be larger than Nvidia isn't an outlandish bet. Alphabet's and Amazon's stocks would need to rise by 29% and 48%, respectively, to surpass Nvidia. Over five years, this isn't too much of a gap to close. But what makes these two better picks than Nvidia? For the record, Nvidia is the best AI company right now. That doesn't mean it will stay in that position over the next five years. Any company involved in the AI arms race is currently loading up on graphics processing units (GPUs) made by Nvidia. This is to equip themselves with the most powerful computing devices available on the market so they can create accurate AI models quickly. Eventually, this demand will be satisfied, and Nvidia's revenue may retract as fewer companies create new AI-dedicated servers and replace them when they are worn out. After this phase, much of the demand will center around who can provide AI models or infrastructure to run them on. Alphabet and Amazon are massive players in the cloud computing industry, so this sets them up well for the next phase of AI investing. Cloud computing is a vital platform in AI proliferation because it allows companies that don't have the means or the need for a supercomputer at all times to run heavy workloads like AI models. By outsourcing these workloads over the cloud to platforms like Google Cloud or Amazon Web Services (AWS), more companies have access to the computing power they need to run AI models. Additionally, each has AI development tools and generative AI models that developers can access through these cloud platforms. Cloud computing will be the next primary beneficiary of the AI gold rush, and it's already seeing strong demand. Cloud computing business had a strong Q1 Even before AI became a huge draw to these platforms, cloud computing excelled. However, each company has been doing phenomenally recently. In the cloud computing world, three stand out: AWS, Microsoft Azure, and Google Cloud (ranked in terms of market share). AWS has a massive market lead over its competitors due to its first-mover advantage, and the mature business unit produces some outstanding numbers. In the first quarter, AWS had sales of $25 billion, with an operating income of $9.4 billion. That equates to an outstanding 38% operating profit margin, which shows how profitable these platforms can get when they have reached a mature state. Google Cloud is much smaller. Its revenue was $9.6 billion in Q1, growing at a 28% pace, and its operating margin was 9%. This shows how much room Google Cloud has to expand its margins, so this could become a large profit driver over the next few years. Cloud computing will be the next primary beneficiary of the AI movement. As a result, I think the big three in cloud computing will be worth more than Nvidia five years from now (even though Microsoft is already larger than Nvidia). The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now... and Amazon wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $722,626!* Stock Advisor provides investors with an easy-to-follow blueprint for success, including guidance on building a portfolio, regular updates from analysts, and two new stock picks each month. The Stock Advisor service has more than quadrupled the return of S&P 500 since 2002*. Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool's board of directors. John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Keithen Drury has positions in Alphabet and Amazon. The Motley Fool has positions in and recommends Alphabet, Amazon, Microsoft, and Nvidia. The Motley Fool recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy. The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Is Nvidia Heading to $200 in the 2nd Half? | The Motley Fool

Nvidia (NVDA -2.61%) stock soared more than 500% over the past three years, prompting investors to wonder if it would be ripe for a slowdown 2024. But enthusiasm about this artificial intelligence (AI) chip leader continued, and the stock surged nearly 150% in the first half. This is as the company reported triple-digit gains in earnings and prepared for the launch of a whole new architecture, known as Blackwell, later this year. Meanwhile, to make this high-flying stock more accessible to a broader range of investors, Nvidia completed a 10-for-1 stock split a few weeks ago. This brought the per-share price down from more than $1,000 to about $120. Now, as the second half of the year starts to unfold, investors are wondering if the stock performance slowdown some anticipated will happen -- or if this top stock will continue to roar higher and even reach $200. Is Nvidia heading to $200 in the second half? Let's find out. First, a quick bit about why Nvidia stock has skyrocketed in recent years -- after all, there are plenty of chipmakers out there. Nvidia's success is due to the top performance of its graphics processing units (GPUs), or chips used to power AI tasks. They are recognized as the fastest around, and on top of this, the company has developed an entire ecosystem of products and services, meaning customers can rely on Nvidia for all of their AI needs. Nvidia's AI portfolio is available through the major cloud companies, making it easy to find and access these top products and services. All of this has helped Nvidia's revenue to soar to records quarter after quarter. In the most recent three-month period, Nvidia reported $26 billion in total revenue, driven by AI demand. This is more than double the company's full year revenue as recently as in the 2020 fiscal year. So the AI boom has driven enormous growth at Nvidia, and that's why investors have piled into the stock. Now, let's consider the company's share price, about $121 as of this writing. Wall Street's average estimate calls for a 10% gain within the coming 12 months, but at least one of the most bullish analysts predicts the stock will advance 65% to $200 within that time period. Hans Mosesmann, a Rosenblatt analyst, recently raised his price target to that level from $140 -- that would bring Nvidia to almost a $5 trillion valuation from $2.9 trillion right now. Today, the market's most valuable company is Microsoft, with a market cap of more than $3.2 trillion. Though this may seem like a big potential jump, especially if we look at market value, it's important to remember that Nvidia continues to grow in the triple digits. The company predicts revenue of about $28 billion in the second quarter, which would represent an increase of more than 100% from the year-earlier period. And Nvidia has a huge catalyst ahead, the release of its Blackwell architecture and chip -- demand already has exceeded supply and Nvidia expects this trend to continue into next year. All of this means it's very possible Nvidia could reach $200 a year from now. What about in the second half of this year though? Nvidia is likely to gain, maybe even in the double digits, buoyed by optimism about the Blackwell release and ongoing growth. But I wouldn't expect the stock to reach $200 so quickly. Some investors may wait to monitor the Blackwell release and see how it translates into earnings growth. What does all of this mean for you as an investor? It actually doesn't matter whether Nvidia reaches $200 this year, next year, or a bit later. What's most important is Nvidia's ability to maintain its AI leadership and generate earnings growth over time -- if the company can do this, there's reason to be optimistic about long-term stock performance. And, right now, considering Nvidia's solid AI platform and plans for annual innovation, there's reason to be optimistic about this top AI stock over the long run.

Is Nvidia Heading to $200 in the 2nd Half?

Nvidia (NASDAQ: NVDA) stock soared more than 500% over the past three years, prompting investors to wonder if it would be ripe for a slowdown 2024. But enthusiasm about this artificial intelligence (AI) chip leader continued, and the stock surged nearly 150% in the first half. This is as the company reported triple-digit gains in earnings and prepared for the launch of a whole new architecture, known as Blackwell, later this year. Meanwhile, to make this high-flying stock more accessible to a broader range of investors, Nvidia completed a 10-for-1 stock split a few weeks ago. This brought the per-share price down from more than $1,000 to about $120. Now, as the second half of the year starts to unfold, investors are wondering if the stock performance slowdown some anticipated will happen -- or if this top stock will continue to roar higher and even reach $200. Is Nvidia heading to $200 in the second half? Let's find out. First, a quick bit about why Nvidia stock has skyrocketed in recent years -- after all, there are plenty of chipmakers out there. Nvidia's success is due to the top performance of its graphics processing units (GPUs), or chips used to power AI tasks. They are recognized as the fastest around, and on top of this, the company has developed an entire ecosystem of products and services, meaning customers can rely on Nvidia for all of their AI needs. Nvidia's AI portfolio is available through the major cloud companies, making it easy to find and access these top products and services. All of this has helped Nvidia's revenue to soar to records quarter after quarter. In the most recent three-month period, Nvidia reported $26 billion in total revenue, driven by AI demand. This is more than double the company's full year revenue as recently as in the 2020 fiscal year. So the AI boom has driven enormous growth at Nvidia, and that's why investors have piled into the stock. Now, let's consider the company's share price, about $121 as of this writing. Wall Street's average estimate calls for a 10% gain within the coming 12 months, but at least one of the most bullish analysts predicts the stock will advance 65% to $200 within that time period. Hans Mosesmann, a Rosenblatt analyst, recently raised his price target to that level from $140 -- that would bring Nvidia to almost a $5 trillion valuation from $2.9 trillion right now. Today, the market's most valuable company is Microsoft, with a market cap of more than $3.2 trillion. Nvidia's triple-digit growth Though this may seem like a big potential jump, especially if we look at market value, it's important to remember that Nvidia continues to grow in the triple digits. The company predicts revenue of about $28 billion in the second quarter, which would represent an increase of more than 100% from the year-earlier period. And Nvidia has a huge catalyst ahead, the release of its Blackwell architecture and chip -- demand already has exceeded supply and Nvidia expects this trend to continue into next year. All of this means it's very possible Nvidia could reach $200 a year from now. What about in the second half of this year though? Nvidia is likely to gain, maybe even in the double digits, buoyed by optimism about the Blackwell release and ongoing growth. But I wouldn't expect the stock to reach $200 so quickly. Some investors may wait to monitor the Blackwell release and see how it translates into earnings growth. What does all of this mean for you as an investor? It actually doesn't matter whether Nvidia reaches $200 this year, next year, or a bit later. What's most important is Nvidia's ability to maintain its AI leadership and generate earnings growth over time -- if the company can do this, there's reason to be optimistic about long-term stock performance. And, right now, considering Nvidia's solid AI platform and plans for annual innovation, there's reason to be optimistic about this top AI stock over the long run. The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now... and Nvidia wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $722,626!* Stock Advisor provides investors with an easy-to-follow blueprint for success, including guidance on building a portfolio, regular updates from analysts, and two new stock picks each month. The Stock Advisor service has more than quadrupled the return of S&P 500 since 2002*. Adria Cimino has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Microsoft and Nvidia. The Motley Fool recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy. The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Is Nvidia Heading to $200 in the 2nd Half?

Nvidia (NASDAQ: NVDA) stock soared more than 500% over the past three years, prompting investors to wonder if it would be ripe for a slowdown 2024. But enthusiasm about this artificial intelligence (AI) chip leader continued, and the stock surged nearly 150% in the first half. This is as the company reported triple-digit gains in earnings and prepared for the launch of a whole new architecture, known as Blackwell, later this year. Meanwhile, to make this high-flying stock more accessible to a broader range of investors, Nvidia completed a 10-for-1 stock split a few weeks ago. This brought the per-share price down from more than $1,000 to about $120. Now, as the second half of the year starts to unfold, investors are wondering if the stock performance slowdown some anticipated will happen -- or if this top stock will continue to roar higher and even reach $200. Is Nvidia heading to $200 in the second half? Let's find out. First, a quick bit about why Nvidia stock has skyrocketed in recent years -- after all, there are plenty of chipmakers out there. Nvidia's success is due to the top performance of its graphics processing units (GPUs), or chips used to power AI tasks. They are recognized as the fastest around, and on top of this, the company has developed an entire ecosystem of products and services, meaning customers can rely on Nvidia for all of their AI needs. Nvidia's AI portfolio is available through the major cloud companies, making it easy to find and access these top products and services. All of this has helped Nvidia's revenue to soar to records quarter after quarter. In the most recent three-month period, Nvidia reported $26 billion in total revenue, driven by AI demand. This is more than double the company's full year revenue as recently as in the 2020 fiscal year. So the AI boom has driven enormous growth at Nvidia, and that's why investors have piled into the stock. Now, let's consider the company's share price, about $121 as of this writing. Wall Street's average estimate calls for a 10% gain within the coming 12 months, but at least one of the most bullish analysts predicts the stock will advance 65% to $200 within that time period. Hans Mosesmann, a Rosenblatt analyst, recently raised his price target to that level from $140 -- that would bring Nvidia to almost a $5 trillion valuation from $2.9 trillion right now. Today, the market's most valuable company is Microsoft, with a market cap of more than $3.2 trillion. Nvidia's triple-digit growth Though this may seem like a big potential jump, especially if we look at market value, it's important to remember that Nvidia continues to grow in the triple digits. The company predicts revenue of about $28 billion in the second quarter, which would represent an increase of more than 100% from the year-earlier period. And Nvidia has a huge catalyst ahead, the release of its Blackwell architecture and chip -- demand already has exceeded supply and Nvidia expects this trend to continue into next year. All of this means it's very possible Nvidia could reach $200 a year from now. What about in the second half of this year though? Nvidia is likely to gain, maybe even in the double digits, buoyed by optimism about the Blackwell release and ongoing growth. But I wouldn't expect the stock to reach $200 so quickly. Some investors may wait to monitor the Blackwell release and see how it translates into earnings growth. What does all of this mean for you as an investor? It actually doesn't matter whether Nvidia reaches $200 this year, next year, or a bit later. What's most important is Nvidia's ability to maintain its AI leadership and generate earnings growth over time -- if the company can do this, there's reason to be optimistic about long-term stock performance. And, right now, considering Nvidia's solid AI platform and plans for annual innovation, there's reason to be optimistic about this top AI stock over the long run. The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now... and Nvidia wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $722,626!* Stock Advisor provides investors with an easy-to-follow blueprint for success, including guidance on building a portfolio, regular updates from analysts, and two new stock picks each month. The Stock Advisor service has more than quadrupled the return of S&P 500 since 2002*. Adria Cimino has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Microsoft and Nvidia. The Motley Fool recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy. The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Nvidia Stock Rises Monday, Helping Fuel S&P 500 and Nasdaq Gains -- Here's Why

The gains came amid reports Nvidia is making a version of its artificial intelligence (AI) chip for the Chinese market compliant with U.S. trade restrictions, after worries about tougher trade restrictions and geopolitical tensions fueled a sell-off in chip stocks last week. Several analysts also raised their price targets for Nvidia stock Monday, anticipating strong results from the chipmaker's earnings report next month and demand for Nvidia's products. Nvidia Price Targets Lifted Piper Sandler analysts reportedly raised their price target for Nvdia stock to $140 from $120, citing Nvidia's second-quarter earnings report set for Aug. 28 as a potential growth catalyst and strong demand for the company's products. Loop Capital analysts also lifted their target to $175 from $120. Shares of Nvidia were up about 2.5% at $120.86 around 11:30 a.m. ET on Monday and have more than doubled in value since the start of the year.

Prediction: 2 Artificial Intelligence Stocks That Could Be Worth More Than Nvidia 5 Years From Now | The Motley Fool

Nvidia is significantly larger than almost every company in the world. However, that doesn't mean it will necessarily stay that way. A lot can happen over five years, and I think two companies will pass Nvidia in size over the next five years: Alphabet (GOOG 0.10%) (GOOGL -0.02%) and Amazon (AMZN -0.34%). Both happen to be involved in artificial intelligence (AI) as well, and I think they make for better buys than Nvidia right now. First, let's figure out how much of a head start Nvidia has on these two companies. While Nvidia is third in the world's largest company race, Alphabet and Amazon are fourth and fifth, respectively. So, predicting these two will be larger than Nvidia isn't an outlandish bet. Alphabet's and Amazon's stocks would need to rise by 29% and 48%, respectively, to surpass Nvidia. Over five years, this isn't too much of a gap to close. But what makes these two better picks than Nvidia? For the record, Nvidia is the best AI company right now. That doesn't mean it will stay in that position over the next five years. Any company involved in the AI arms race is currently loading up on graphics processing units (GPUs) made by Nvidia. This is to equip themselves with the most powerful computing devices available on the market so they can create accurate AI models quickly. Eventually, this demand will be satisfied, and Nvidia's revenue may retract as fewer companies create new AI-dedicated servers and replace them when they are worn out. After this phase, much of the demand will center around who can provide AI models or infrastructure to run them on. Alphabet and Amazon are massive players in the cloud computing industry, so this sets them up well for the next phase of AI investing. Cloud computing is a vital platform in AI proliferation because it allows companies that don't have the means or the need for a supercomputer at all times to run heavy workloads like AI models. By outsourcing these workloads over the cloud to platforms like Google Cloud or Amazon Web Services (AWS), more companies have access to the computing power they need to run AI models. Additionally, each has AI development tools and generative AI models that developers can access through these cloud platforms. Cloud computing will be the next primary beneficiary of the AI gold rush, and it's already seeing strong demand. Even before AI became a huge draw to these platforms, cloud computing excelled. However, each company has been doing phenomenally recently. In the cloud computing world, three stand out: AWS, Microsoft Azure, and Google Cloud (ranked in terms of market share). AWS has a massive market lead over its competitors due to its first-mover advantage, and the mature business unit produces some outstanding numbers. In the first quarter, AWS had sales of $25 billion, with an operating income of $9.4 billion. That equates to an outstanding 38% operating profit margin, which shows how profitable these platforms can get when they have reached a mature state. Google Cloud is much smaller. Its revenue was $9.6 billion in Q1, growing at a 28% pace, and its operating margin was 9%. This shows how much room Google Cloud has to expand its margins, so this could become a large profit driver over the next few years. Cloud computing will be the next primary beneficiary of the AI movement. As a result, I think the big three in cloud computing will be worth more than Nvidia five years from now (even though Microsoft is already larger than Nvidia).