Nvidia Reaches $4.5 Trillion Valuation Amid Strong AI Chip Demand
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 1h ago
0mins
Source: Fool
- Market Valuation: Nvidia's market cap has reached $4.5 trillion, and despite a slowing growth rate, it maintains an impressive growth of over 60%, reflecting strong demand in the artificial intelligence sector.
- Production Expansion: The company is looking to collaborate with Taiwan Semiconductor Manufacturing to boost production of H200 AI chips, as Chinese companies have ordered over 2 million units while only 700,000 are in stock, indicating a tight supply situation.
- Profitability Risks: Focusing on the Chinese market for H200 chips may impact Nvidia's margins due to a 25% revenue cut mandated by the U.S. government, which could lead to lower profitability despite strong demand.
- Geopolitical Risks: The uncertainty surrounding U.S.-China relations may affect Nvidia's sales, especially as reports indicate that the Chinese government has instructed local companies to temporarily halt purchases of H200 chips, potentially putting pressure on future earnings expectations.
Analyst Views on NVDA
Wall Street analysts forecast NVDA stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for NVDA is 255.63 USD with a low forecast of 185.00 USD and a high forecast of 352.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
40 Analyst Rating
38 Buy
1 Hold
1 Sell
Strong Buy
Current: 183.140
Low
185.00
Averages
255.63
High
352.00
Current: 183.140
Low
185.00
Averages
255.63
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.
