Nvidia (NASDAQ:NVDA) may not be an AI stock in the purest sense of the term, but it’s rapidly on its way to becoming one thanks to the sheer amount of hardware it’s putting out that’s useful in artificial intelligence development and related applications. In fact, Nvidia notched up just over 2% in Tuesday afternoon’s trading thanks to what analysts refer to as an “AI Supercycle” about to unfold.
The analyst in question, Robert W. Baird analyst Tristan Gerra, made it clear: not only would Nvidia likely see major revenue upswings in the second quarter, but that momentum would also likely carry on into the second half. The biggest reason for that is that, according to Gerra, Nvidia still basically enjoys the first-mover advantage and would likely continue to enjoy same for the next several months, at least. Moreover, Nvidia’s original primary stock in trade—commercial-grade graphics processing units—are coming back into demand and will likely also fuel gains for Nvidia.
Indeed, there are no shortage of buyers on the AI front, if nothing else. While certainly, an uncertain economic picture might dampen the enthusiasm of PC gamers and amateur cryptocurrency miners, there are plenty of buyers in the wings. Saudi Arabia, for example, has already bought 3,000 Nvidia H100 chips. The United Arab Emirates (UAE) landed another bloc of unspecified “thousands”. Large language models are already under development. Meanwhile, word out of Tom’s Hardware suggests that, in 2023 alone, Nvidia will sell over half a million H100 chips.
Analysts, meanwhile, are all over Nvidia. With 30 Buy ratings and merely two Hold, Nvidia stock is classified as a Strong Buy by analyst consensus. Further, with an average price target of $513.50, Nvidia stock offers investors an upside potential of 15.07%.
