Bengaluru, India – Nvidia’s shares are expected to reach new heights as Goldman Sachs raises its price target for the chipmaker’s stock, citing potential earnings growth from the artificial intelligence (AI) boom. The stock saw a 4% increase to $687.59 in early trading, signaling a potential addition of over $55 billion to the company’s market capitalization. This surge would bring the market value of Nvidia to $1.63 trillion.
Nvidia has become a leading figure in the AI industry, witnessing a record monthly increase in market value in January. Despite the stock’s 34% rise this year, it still trades at a higher valuation compared to its peers, with shares priced at 31.4 times the company’s forward earnings estimate, while the industry average stands at 22.9.
Goldman Sachs analyst Toshiya Hari believes that there is further room for growth, projecting Nvidia to remain the industry’s gold standard due to its cutting-edge hardware and software offerings and its continuous innovation. The bank has raised the price target for Nvidia’s stock to $800, the third highest among U.S. analysts, indicating a 21% potential upside from current levels.
The AI server demand and improving graphics processing unit (GPU) supply have prompted the bank to raise its full-year 2025-2026 earnings estimates for Nvidia by 22% on average. This comes as companies such as Microsoft and Meta Platforms demonstrate signs of AI monetization, while AI server maker Super Micro Computer reveals a positive earnings outlook.
While Nvidia has reaped significant revenue from the AI frenzy, chipmakers less involved in AI, like Intel, have experienced a slower stock performance. Nvidia is expected to release its fourth-quarter earnings on Feb. 21, with analysts forecasting earnings per share of $4.51 and revenue of $20.19 billion.
This anticipated growth in Nvidia’s stock reflects the company’s increasing influence and success in the AI industry, highlighting its potential to remain a dominant force in the market.