NVDA gained a massive 197% since our AI first added it in November - is it time to sell? 🤔Read more

Top pick NVIDIA's potential upside is significant - New Street Research

Published 2024-01-08, 09:28 a/m
© Reuters
NVDA
-

New Street Research named NVIDIA (NVDA) as one of its top picks for 2024 in a recent note, noting the total addressable market (TAM) for AI data center chips.

"The $400bn TAM for AI data center chips AMD pitched last month may eventually prove wrong but must be considered seriously. It is a possibility and the direction of travel for now," wrote analysts.

"In that context, the outlook for 2025 should clarify and improve steadily this year, while ASICs and AMD will get understood for what they are: challengers at best travelling along with Nvidia (NASDAQ:NVDA)," they added, maintaining a Buy rating and $700 per share price target on the stock, representing a potential 43% upside.

New Street Research believes that reasonable assumptions on usage and model complexity can justify an AI server installed base growing 5x by 2027.

"10m AI servers installed in 2027 requires close to 50m chips shipped in 2027, adding up to $400bn," said analysts. "Even if the $400bn scenario materializes partially, the upside for Nvidia is significant. We value Nvidia 30X 2025 EPS of $23."

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.