At least five companies have raised their price targets on the artificial intelligence darling this month, as Wall Street scrambles to keep up with Nvidia Inc.’s ferocious rally heading into 2024.
The semiconductor giant’s shares have soared 46% this year, adding about $560 billion to its market capitalization. This strength, and the insatiable demand for accelerators to power AI tasks, puts UBS Group AG and Mizuho Securities ahead of competitors Morgan Stanley, Bank of America and Goldman Sachs Group Inc. The stock price target was raised in advance. Results will be announced on February 21st.
UBS this week raised its price target to $850 from $580 and also raised its earnings per share forecast. Meanwhile, Mizuho raised its price target from $625 to $825. Demand for Nvidia’s H100 AI accelerator continues to outstrip supply, Mizuho’s Vijay Rakesh wrote in a note to clients, calling the stock the best stock for AI.
Nvidia fell 0.2% on Tuesday, closing at about $721. But it outperformed big tech companies, which had come under pressure after a report that U.S. consumer prices rose more than expected last month. The Nasdaq 100 index fell 1.6%.
The Santa Clara, Calif.-based company’s stock has been among the top performers on both the S&P 500 and Nasdaq 100 indexes this year, making it one of Wall Street’s most beloved stocks. Among analysts tracked by Bloomberg, there were 58 buy ratings, five hold ratings, and just one sell rating.
On average, analysts have raised their 2024 revenue estimates by more than 100% over the past 12 months, according to data compiled by Bloomberg.
Still, the company has struggled to keep up with Amazon.com Inc.’s share price, which has outpaced its market capitalization. Wall Street’s average 12-month price target of about $690 is about 4.4% below Tuesday’s closing price.