Nvidia Stock Still Has Room To Run Analysts Say

Introduction

Nvidia stock has been on a remarkable upward trajectory, with its price increasing by 900% in less than two years. The recent stock split, which was conducted at a ratio of 10-for-1, has further fueled investor interest in the company. Prior to the split, Nvidia shares were trading near $120, and now post-split, they are also trading at around $120. This significant rise in stock price has positioned Nvidia as the world’s second-highest-valued company, surpassing even Apple.

The decision to conduct a stock split indicates the confidence that Nvidia has in its future growth prospects. By increasing the number of shares available, it becomes more accessible to retail investors and can attract a broader investor base. Additionally, a lower share price may also make it more affordable for individual investors to add Nvidia to their portfolios.

Analysts believe that despite the impressive performance of Nvidia’s stock so far, there is still room for further growth. The company’s strong market position and future growth potential, along with its impressive financial performance and continued innovation, are key factors contributing to this positive outlook. In the following sections, we will delve deeper into these aspects and explore why analysts remain bullish on Nvidia’s stock.

By examining these factors closely, we can gain insights into why Nvidia’s stock still has room to run and why it may be an attractive investment opportunity for both short-term traders and long-term investors.

nvidia stock prediction

Based on 40 Wall Street analysts offering 12 month price targets for Nvidia in the last 3 months. The average price target is $127.24 with a high forecast of $150.00 and a low forecast of $90.00. The average price target represents a 1.63% change from the last price of $125.20.Past 12 Months12 Month Forecast$37$65.5$94$122.5$151Sep​2023Dec​2023Mar​2024Jun​2024Jun​2025

High$150.00

Average$127.24

Low$90.00

Source: Tiprank

1. Strong Market Position and Future Growth Potential

Nvidia has established itself as a leader in the AI market, positioning itself for long-term success. The company’s dominance in this space is a key factor contributing to its future growth potential.

Analysts’ Positive Outlook on Nvidia’s Stock Growth

TD Cowen analyst Matthew Ramsay shares a positive outlook on Nvidia’s stock growth, even after the recent stock split. Ramsay predicts that Nvidia’s split-adjusted price could reach $140, with earnings per share projected to reach $60 by 2030. This optimistic forecast reflects the market’s confidence in Nvidia’s ability to capitalize on the exponential growth potential of AI technologies.

Another analyst, Mark Lipacis from Evercore ISI, highlights Nvidia’s strong market position and future growth potential in emerging technologies like autonomous vehicles and data centers. Lipacis suggests that Nvidia’s weighting in the S&P 500 could grow to 10-15%, further confirming its significance in the market.

Commitment to Innovation and Strategic Partnerships

Nvidia’s commitment to innovation and strategic partnerships also contributes to its strong market position. The company continually invests in research and development to maintain its leadership position in AI technology. One example of this is their latest AI architecture, Rubin, which is set to ship in 2026. Nvidia’s consistent launch of new chip families annually reinforces their position as an invincible force in the industry.

Limited Competition and High Barriers to Entry

With a dominant market share ranging from 70-95% in the AI chip market, Nvidia faces limited competition despite rivals like AMD and Intel entering the space. The high barriers to entry for potential competitors further solidify Nvidia’s position as the go-to provider for AI chips.

Government Support and Recognition

Notably, the importance of Nvidia’s role in the AI industry is underscored by its inclusion in key government initiatives. For instance, the previous US administration recognized the significance of AI and its potential to transform various sectors, leading to the establishment of an official AI task force that aimed to foster innovation and collaboration. Nvidia’s involvement in such initiatives further bolsters its reputation and sets it apart from competitors.

Conclusion

Nvidia’s strong market position as a leader in the AI market, commitment to innovation, limited competition, and government support contribute to its future growth potential. Analysts like Matthew Ramsay and Mark Lipacis are confident in Nvidia’s ability to capitalize on emerging technologies and maintain its dominant position. With exponential AI growth expected in various industries, Nvidia is well-positioned for long-term success.

2. Impressive Financial Performance and Guidance

In this section, we will take a closer look at Nvidia’s recent financial performance and guidance. We will specifically focus on the following areas:

1. Analysis of Financial Results: We will analyze Nvidia’s recent financial results, paying close attention to its impressive performance in the Data Center segment.
2. Understanding Market Opportunities: We will explore how Nvidia’s strong Q1 results reflect its ability to seize upon growing market opportunities.
3. Future Growth Prospects: We will discuss the guidance provided by Nvidia for the upcoming quarter and its potential impact on future growth.

3. Continued Innovation and Competitive Advantage

Nvidia has maintained its leadership in AI technology through continuous innovation and strategic partnerships. By staying ahead of technological advancements, Nvidia ensures that it remains unbeatable in the market.

Cutting-Edge AI Architectures

One key part of Nvidia’s strategy is its focus on developing advanced AI architectures. The company regularly releases new chip families to stay ahead of competitors. For instance, Nvidia plans to ship its latest AI architecture, Rubin, in 2026. This architecture is expected to offer even better performance and efficiency, further establishing Nvidia as an industry leader.

Strategic Partnerships

In addition to internal innovation, Nvidia also collaborates with other industry players through strategic partnerships. By working together with companies like Microsoft and Amazon Web Services (AWS), Nvidia strengthens its capabilities and expands its presence in the AI market. These partnerships enable Nvidia to enter new markets and leverage the expertise of other industry leaders.

Dominant Market Share

Another factor contributing to Nvidia’s competitive advantage is its strong hold on the AI chip market. Despite facing competition from rivals such as AMD and Intel, Nvidia maintains a significant market share of 70% to 95%. This dominant position creates barriers for potential competitors, making it difficult for them to challenge Nvidia’s market leadership.

Nvidia’s continuous innovation and competitive advantage not only secure its current leading position but also position the company for future growth. By staying at the forefront of AI technology and forming strategic partnerships, Nvidia is well-positioned to capitalize on emerging opportunities in the AI market.

Analysts believe that Nvidia has a promising future ahead due to its strong foundation of continuous innovation and significant presence in the competitive AI chip market. The company’s commitment to pushing boundaries and maintaining its leadership status makes it an appealing choice for investors seeking long-term growth potential.

4. Attractive Valuation and Analyst Recommendations

When deciding whether to invest in a company, one important factor to consider is how much the stock is worth. In the case of Nvidia (NVDA), many experts think that the current price of the stock makes it a good choice for investors. Here’s why:

NVDA Stock Valuation

Nvidia’s forward price-to-earnings (P/E) ratio is currently at 44.7x, based on FY2025 earnings expectations. This means that investors are paying $44.7 for every $1 of earnings that Nvidia is expected to make in the future.

Compared to other companies in the same industry like AMD (47.8x) and ASML (51x), Nvidia’s stock is relatively cheaper. A lower P/E ratio suggests that there may be more potential for growth in the stock and it could be a good time to buy.

Analyst Consensus Rating

Another thing to look at is what analysts, who are experts in the field, think about the stock. The consensus among analysts for Nvidia is a strong buy, which is the highest rating they can give.

Right now, there are 37 analysts recommending to buy Nvidia’s stock and only 3 suggesting to hold onto it. This overwhelming support from experts adds weight to the argument for investing in Nvidia.

Target Prices and Recommendations

Analysts have also set target prices for Nvidia’s stock, which are their estimates for how much they think the price will go up in the future. While these target prices can vary among analysts, looking at the average gives us an idea of the overall sentiment.

The average target price for NVDA is $123.62, which implies a potential increase of around 2.2% over the next year.

It’s important to remember that analyst recommendations and target prices should not be taken as guarantees of what will happen in the future. However, they can provide useful information for investors to consider.

By looking at the current valuation of Nvidia’s stock and considering the consensus rating from analysts, it becomes clear that there is an attractive opportunity for investors who are interested in adding Nvidia to their portfolios.

Potential Risks and Concerns

Nvidia’s position as a market leader in the AI industry is not without its challenges. While the company has enjoyed tremendous success and growth, there are potential risks and concerns that investors should be aware of:

1. Competition from AMD and Intel: As AI technology becomes increasingly important across industries, competition in the market is intensifying. Both AMD and Intel are investing heavily in their AI capabilities and could pose a threat to Nvidia’s dominance. AMD, in particular, has made significant strides in the GPU market with its Radeon Instinct accelerators. Intel, on the other hand, is focusing on developing its own accelerators and software solutions. Nvidia will need to continue innovating and staying ahead of its competitors to maintain its market share.
2. Waning Demand: Critics have raised concerns about the potential for a slowdown in demand for Nvidia’s products. After the initial wave of AI adoption, some argue that demand may plateau or decline as companies have already invested heavily in AI infrastructure. Additionally, economic downturns or shifts in industry priorities could impact demand for Nvidia’s products. It will be crucial for Nvidia to diversify its product offerings and continue expanding into emerging technologies to mitigate these risks.

Despite these potential risks, there are reasons to remain optimistic about Nvidia’s future prospects. The company’s strong market position, continuous innovation, and strategic partnerships provide a solid foundation for growth. Furthermore, the increasing adoption of AI across industries suggests that the demand for Nvidia’s products will likely continue to grow in the long term.

By addressing these risks head-on and proactively adapting to changing market dynamics, Nvidia can position itself for continued success in the evolving AI landscape.

Conclusion

In conclusion, analysts believe that Nvidia’s stock still has room to run due to several key factors. Let’s recap the compelling arguments presented in this article:

• Dominant position in the AI market: Nvidia is a leader in the AI industry with a significant market share. Despite increasing competition from rivals like AMD and Intel, Nvidia maintains its top-notch AI leadership status, with its latest AI architecture Rubin shipping in 2026 and new chip families launched annually.
• Strong financial performance: Nvidia’s impressive financial results, particularly in the Data Center segment, reflect its ability to capitalize on growing market opportunities. With Q1 revenue of $26.04 billion and adjusted gross margin of 78.4%, Nvidia’s strong performance demonstrates its potential for future growth.
• Positive analyst sentiment: Analysts have expressed optimism about Nvidia’s stock growth potential. TD Cowen analyst Matthew Ramsay predicts a split-adjusted price target of $140 and an EPS of $60 by 2030. Evercore ISI analyst Mark Lipacis believes that Nvidia’s S&P 500 weighting could grow to 10-15%.

Considering these factors, it is worth conducting your own research and considering adding Nvidia to your investment portfolio. The company’s dominant position in the AI market, strong financial performance, and positive analyst sentiment provide a compelling case for further upside potential.

As always, it is important to carefully evaluate your investment decisions and consult with a financial advisor before making any investment choices.