Nvidia Soars to Record Highs as Goldman Sachs Raises Price Target Amidst AI Boom

Nvidia Soars to Record Highs as Goldman Sachs Raises Price Target Amidst AI Boom

Nvidia, the leading AI chip maker, has reached new heights with its shares hitting a record high on Monday, gaining over $450 billion in value this year alone. The surge is attributed to the booming demand for artificial intelligence applications, making Nvidia a crucial player for major tech giants.

The semiconductor giant has solidified its position as the world’s largest producer of chips for AI applications, playing a vital role in the expansion plans of cloud-computing giants like Microsoft, Alphabet, Meta Platforms, and Amazon. Meta’s Founder and CEO, Mark Zuckerberg, revealed plans to deploy around 350,000 H100 graphics-processing units, Nvidia’s AI-focused chips, by the end of the year, bringing their total to approximately 600,000, solidifying Meta’s position as one of the largest AI systems globally.

Nvidia’s anticipated fourth-quarter earnings, expected to be announced on Feb. 21, are projected to surpass $20.2 billion, marking a remarkable three-fold increase from the previous year, driven by the escalating demand for AI. Taiwan Semiconductor, a key player in Nvidia’s supply chain, has also added optimism by forecasting a 20% increase in sales for 2024.

Adding to the positive outlook, Nvidia is set to introduce the next-generation B100 Blackwell chip to its AI-focused lineup later this year. This addition, combined with continuous innovation, has prompted Goldman Sachs analyst Toshiya Hari to include Nvidia in the investment bank’s conviction buy list. Hari raised the price target to $800 per share, foreseeing a 3% to 5% beat on both fourth-quarter revenues and the current-quarter outlook.

Goldman analysts express confidence in Nvidia’s sustained growth, emphasizing its robust hardware and software offerings. The upbeat outlook is further supported by the expanding customer profile, multiple new-product cycles, and the continuous spending on generative AI infrastructure by large cloud service providers.

Despite potential headwinds from new trade restrictions, Hari sees Nvidia as the industry gold standard, projecting consistent growth through the first half of 2025. The stock’s current momentum reflects a 42% increase since the beginning of the year, reaching an all-time high of $694.97.

In summary, Nvidia’s remarkable performance, fueled by the AI boom and strong demand from tech giants, positions the company as a frontrunner in the industry, with Goldman Sachs expressing confidence in its continued success.

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