Nvidia stock jumped to an all-time high on Monday after investment bank Goldman Sachs hiked its price target on the maker of chips for artificial intelligence.
Analyst Toshiya Hari raised his 12-month price target on Nvidia stock to 800 from 625. He also reiterated his buy rating and kept Nvidia on the firm's "conviction list" of top stock picks.
On the stock market today, Nvidia stock rose 4.8% to close at 693.32. Earlier in the session, it notched a record high 694.97.
In a client note, Hari said Nvidia will benefit from "robust AI server demand and improving GPU (graphics processing unit) supply."
He also raised his Nvidia earnings estimates for fiscal 2025 and 2026. Nvidia's fiscal 2024 ended on Jan. 28.
AI Data Center Spending To Continue
"We no longer assume a drop-off in data center revenue in second-half calendar year 2024 and instead model consistent growth through first-half calendar 2025, driven by continued spending on Gen AI infrastructure by the large cloud service providers, a broadening customer profile, and multiple new product cycles," he said.
Recent reports from Meta Platforms, Microsoft and Super Micro Computer back his bullish stance on Nvidia, Hari said.
Hyperscale cloud service providers like Meta continue to invest heavily in AI-powered data centers, he said. Plus, Meta and Microsoft are showing early evidence of AI monetization for their services, Hari said.
Nvidia Stock: 'Gold Standard' For AI
Meanwhile, Nvidia is likely to outperform rival Advanced Micro Devices in the AI chip market, he said.
"From a competitive standpoint, although AMD is making good progress with its MI300 platform, we believe Nvidia will remain as the industry gold standard for the foreseeable future given its robust hardware and software offerings and, importantly, the pace at which it continues to innovate."
The next potential catalyst for Nvidia stock will be the company's fiscal fourth quarter report, due on Feb. 21.
Nvidia stock is on five IBD stock lists: IBD 50, Leaderboard, Big Cap 20, Sector Leaders and Tech Leaders.
On Jan. 8, Nvidia stock broke out of a flat base at a buy point of 505.48, according to IBD MarketSmith charts. Although Nvidia has risen beyond the 20%-to-25% profit-taking level from its breakout, it also is subject to the eight-week hold rule.
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