Nvidia Makes Significant Investment in AI Startup Thinking Machines
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 7 hours ago
0mins
Should l Buy NVDA?
Source: seekingalpha
- Undisclosed Investment Size: Nvidia announced a multi-year partnership with AI startup Thinking Machines, with the investment amount undisclosed, indicating Nvidia's ongoing commitment to the AI sector, potentially reinforcing its market leadership.
- Technical Support Plan: Thinking Machines plans to deploy at least one gigawatt of Nvidia's Vera Rubin systems to support its frontier model training and platform development, set for early next year, which will significantly enhance its AI development capabilities and accelerate product time-to-market.
- Collaboration with Industry Leaders: Nvidia CEO Jensen Huang stated that Thinking Machines has assembled a world-class team, and the partnership will advance the frontier of AI, underscoring Nvidia's core position in AI technology infrastructure and potentially attracting more partners.
- Funding Background: Thinking Machines raised $2 billion in July, achieving a valuation of $10 billion, with participants including Nvidia, AMD, and Andreessen Horowitz, providing strong market confidence and support for Nvidia's investment.
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Analyst Views on NVDA
Wall Street analysts forecast NVDA stock price to rise
41 Analyst Rating
39 Buy
1 Hold
1 Sell
Strong Buy
Current: 182.650
Low
200.00
Averages
264.97
High
352.00
Current: 182.650
Low
200.00
Averages
264.97
High
352.00
About NVDA
NVIDIA Corporation is a full-stack computing infrastructure company. The Company is engaged in accelerated computing to help solve the challenging computational problems. The Company’s segments include Compute & Networking and Graphics. The Compute & Networking segment includes its Data Center accelerated computing platforms and artificial intelligence (AI) solutions and software; networking; automotive platforms and autonomous and electric vehicle solutions; Jetson for robotics and other embedded platforms, and DGX Cloud computing services. The Graphics segment includes GeForce GPUs for gaming and PCs, the GeForce NOW game streaming service and related infrastructure, and solutions for gaming platforms; Quadro/NVIDIA RTX GPUs for enterprise workstation graphics; virtual GPU software for cloud-based visual and virtual computing; automotive platforms for infotainment systems, and Omniverse Enterprise software for building and operating industrial AI and digital twin applications.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Nvidia Stock Price Potential Analysis
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- Market Share Advantage: Nvidia holds a dominant 92% share in the data center GPU market, and with its leadership in AI and cloud computing, the company anticipates continued revenue growth, projecting first-quarter revenue of $78 billion, a 77% year-over-year increase, which will further enhance its competitive edge.
- Analyst Outlook: Tigress Financial analyst Ivan Feinseth reiterated a strong buy rating on Nvidia, raising the 12-month price target to $360, forecasting the company will generate $406 billion in revenue and $201 billion in operating profit over the next year, reflecting strong market confidence in its growth prospects.
- Investor Confidence Rebound: Despite concerns about an AI bubble shaking some investors, 90% of retail investors plan to maintain or increase their AI holdings, indicating long-term optimism for Nvidia, with the current stock price being relatively undervalued, presenting a buying opportunity for seasoned investors.
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- Profitability Surge: With a profit margin exceeding 50%, Nvidia is expected to become the most profitable company globally by year-end, surpassing Alphabet, showcasing its profitability and market leadership in a high-demand environment.
- Valuation Rebound Potential: Currently trading at a price-to-earnings ratio of about 22 times, significantly lower than the historical range of 40 to 50 times, if market sentiment improves, a return to a 45 times valuation could double the stock price, reflecting its reasonable valuation potential.
- Long-term Investment Confidence: Despite cautious market sentiment regarding the AI sector, hyperscalers are likely to continue investing in infrastructure, believing the risk of underinvestment is greater, suggesting that by 2026, market sentiment may recover, further driving Nvidia's stock price upward.
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- Significant Performance Growth: Nvidia achieved record revenue of $68 billion in Q4 of fiscal 2026, representing a 73% year-over-year increase, with earnings per share (EPS) soaring to $1.76, up 98%, demonstrating the strong demand driven by AI and solidifying its market leadership.
- Market Share Advantage: Nvidia holds a dominant 92% share in the data center GPU market, and with its leadership in AI and cloud computing, the company anticipates continued revenue growth, projecting first-quarter revenue of $78 billion, a 77% year-over-year increase, which will further enhance its competitive edge.
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- Investor Confidence Rebound: Despite concerns about an AI bubble shaking some investors, 90% of retail investors plan to maintain or increase their AI holdings, indicating long-term optimism for Nvidia, with the current stock price being relatively undervalued, presenting a buying opportunity for seasoned investors.
See More
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- Strong Market Demand: Nvidia's GPUs have become the primary hardware for training AI models, with revenue projected to grow by 70% to over $360 billion by fiscal 2027, indicating robust market demand and future growth potential in the AI sector.
- Profitability Surge: With a profit margin exceeding 50%, Nvidia is expected to become the most profitable company globally by year-end, surpassing Alphabet, showcasing its profitability and market leadership in a high-demand environment.
- Valuation Rebound Potential: Currently trading at a price-to-earnings ratio of about 22 times, significantly lower than the historical range of 40 to 50 times, if market sentiment improves, a return to a 45 times valuation could double the stock price, reflecting its reasonable valuation potential.
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- Trading Volume: The trading volume reached 177.6 million shares, approximately 0.6% above the three-month average of 176.6 million shares, indicating sustained market interest and activity in Nvidia's stock.
- New Platform Launch: Nvidia plans to introduce an open-source AI agent platform named 'NemoClaw', which is expected to transition the company from a hardware provider to a key player in software solutions, enhancing its competitiveness in the growing AI tools market.
- Investment Advisory: Despite Nvidia's impressive past performance, the Motley Fool Stock Advisor analyst team did not include it in their current list of top investment stocks, advising investors to consider this before making purchasing decisions.
See More
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- Legal Support Statement: Microsoft stated in a court filing in San Francisco that it supports Anthropic's request for a temporary restraining order to block the Pentagon's designation of it as a supply chain risk, aiming to avoid disruptions to the military's use of advanced AI and ensure operational continuity.
- Potential Impact Warning: Microsoft warned that without the order, tech companies would need to immediately alter existing product and contract configurations with the Defense Department, which could hinder U.S. warfighters' capabilities at a critical time, highlighting the close ties between technology and defense.
- Investment Background: Microsoft announced plans to invest up to $5 billion in Anthropic last November, demonstrating its long-term confidence in the company and reflecting its strategic positioning in the AI sector, particularly in defense-related technology applications.
- Negotiation Breakdown: Despite recent negotiations between Anthropic and the Defense Department over contract terms, talks collapsed due to disagreements on model usage, escalating tensions and impacting Anthropic's business outlook.
See More
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- Stake Sale Overview: On February 17, 2026, BLKBRD Asset Management disclosed it sold all 318,666 shares of Hims & Hers Health, with an estimated transaction value of $18.07 million, reflecting a complete exit from its position during the fourth quarter.
- Impact on Asset Management: This sale reduced Hims & Hers' stake from 5% to 0%, indicating a significant loss of confidence from BLKBRD, which could negatively influence market perceptions of Hims & Hers.
- Stock Performance: As of February 16, 2026, Hims & Hers shares were priced at $16.30, down 72.46% over the past year, underperforming the S&P 500 by 84.25 percentage points, highlighting severe competitive challenges.
- Future Outlook: Although Hims & Hers recently announced a new partnership with Novo Nordisk that may provide a short-term stock rebound, ongoing market pressures and competitive challenges suggest that investors should carefully assess the company's long-term prospects.
See More
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- Complete Exit: On February 17, 2026, BLKBRD Asset Management disclosed it fully exited its position in Hims & Hers Health by selling 318,666 shares, with an estimated trade value of $18.07 million, resulting in a 24.3% drop in the fund's quarterly average assets under management (AUM).
- Value Decline: The liquidation left Hims & Hers Health with a net position value of zero, previously accounting for 5.0% of the fund's AUM, indicating a complete loss of confidence in the stock by the fund.
- Market Reaction: Hims & Hers' stock has been in freefall since last June, plummeting from a historical high of $64 to around $15, primarily due to Novo Nordisk terminating its partnership and suing the company, which negatively impacted market expectations for its future.
- New Partnership Opportunity: Despite these challenges, Hims & Hers announced a new partnership with Novo Nordisk on March 10, 2026, to offer its weight-loss drugs Ozempic and Wegovy, leading to a 6% stock price increase and providing investors with a chance to reassess the company's prospects.
See More
