San Francisco, California – Despite Nvidia’s impressive year-to-date stock performance, Bank of America sees more room for growth. The bank upgraded Nvidia’s price target to $1,100, indicating a 24% potential upside. Bank of America noted that even at a $2.2 trillion valuation, Nvidia’s stock remains attractively priced compared to its peers in the semiconductor and information technology industries.
Nvidia’s shares have shown strong performance, rising 80% so far this year and an impressive 287% over the past year. This surge is fueled by the continuing demand for Nvidia’s AI-enabling graphic cards. Despite this success, Nvidia’s stock valuation currently sits lower than when the company launched ChatGPT in 2022.
Bank of America analyst Vivek Arya highlighted that Nvidia’s stock is currently trading at 37 times its next twelve months’ price-to-earnings ratio, lower than the 44 times ratio during ChatGPT’s launch. Arya also pointed out that Nvidia’s stock valuation is well within its historical forward price-to-earnings range of 26 times to 69 times.
Moreover, Arya mentioned that while many investors hold Nvidia stock, they are still underweight it relative to its representation in the S&P 500. This indicates potential for further growth as valuations and ownership levels suggest room for upside.
Investors are eagerly anticipating Nvidia’s upcoming “AI Woodstock” event on March 18. During this event, Nvidia will unveil the successor to its highly popular H100 chip. Analysts expect that the event will showcase the increasing impact of genAI and digital twins across various industries, presenting an opportunity to redefine global computing infrastructure with accelerators.
Overall, Bank of America’s positive outlook on Nvidia reflects confidence in the company’s growth potential and technological advancements. The upcoming events and strong performance of Nvidia’s products continue to drive investor interest and highlight the company’s position as a leader in the AI and semiconductor spaces.