Bank of America on Thursday renewed its Buy recommendation and $150 price target on Nvidia following the stock's recent rally.
The research firm notes that the AI chipmaker has climbed 50% since the start of the second quarter, compared with a 4.4% gain for the S&P 500 index.
After such a score, the stock will become vulnerable to possible profit-taking, BofA warns, although it expects any bout of volatility to be short-lived.
The analyst points out that the group recently insisted that the development of large language model (LLM) and generative artificial intelligence (GenAI) projects were still in their infancy.
Unlike the Internet stock bubble, which was fueled by an overly dangerous reliance on debt, the rise of generative AI is akin to a decisive race between particularly well-funded (cloud) players", he recalls.
BofA is also optimistic about the future impact of the launch of the Blackwell platform, and notes that Nvidia shares are trading on a P/E of just 30x, taking into account the possibility of a profit of up to five dollars per share.
Nvidia remains its preferred stock ('top pick') within the sector.
Copyright (c) 2024 CercleFinance.com. All rights reserved. The information and analyses published by Cercle Finance are intended solely as a decision-making aid for investors. Cercle Finance cannot be held responsible, directly or indirectly, for the use of information and analyses by readers. Uninformed investors are advised to consult a professional advisor before investing. This information does not constitute an invitation to sell or a solicitation to buy.
NVIDIA Corporation is the world leader in the design, development, and marketing of programmable graphics processors. The group also develops associated software. Net sales break down by family of products as follows:
- computing and networking solutions (55.9%): data center platforms and infrastructure, Ethernet interconnect solutions, high-performance computing solutions, platforms and solutions for autonomous and intelligent vehicles, solutions for enterprise artificial intelligence infrastructure, crypto-currency mining processors, embedded computer boards for robotics, teaching, learning and artificial intelligence development, etc.;
- graphics processors (44.1%): for PCs, game consoles, video game streaming platforms, workstations, etc. (GeForce, NVIDIA RTX, Quadro brands, etc.). The group also offers laptops, desktops, gaming computers, computer peripherals (monitors, mice, joysticks, remote controls, etc.), software for visual and virtual computing, platforms for automotive infotainment systems and cloud collaboration platforms.
Net sales break down by industry between data storage (55.6%), gaming (33.6%), professional visualization (5.7%), automotive (3.4%) and other (1.7%).
Net sales are distributed geographically as follows: the United States (30.7%), Taiwan (25.9%), China (21.5%) and other (21.9%).
NVIDIA CORPORATION 
