What Happened?
Shares of leading designer of graphics chips Nvidia (NASDAQ:NVDA) jumped 5.1% in the morning session after market sentiment improved ahead of CEO Jensen Huang’s speech at CES (Consumer Electronic Show) 2025. Markets expect NVDA to provide updates on its next-generation GPU called Rubin.
Wall Street Analysts Weigh In
Wall Street analysts are also positive, with Bernstein reaffirming a Buy rating, adding: ‘Our top AI picks remain NVDA.‘
This optimistic outlook from leading financial institutions is likely to boost investor confidence in Nvidia’s growth prospects. As the company continues to innovate and push the boundaries of artificial intelligence (AI) technology, its shares are expected to ride the wave of growth.
Industry Developments Support Nvidia’s Growth
Separately, Taiwan’s Foxconn also reported strong fourth-quarter results, partly fueled by strong demand for AI servers. This trend is likely to continue in 2025 as more businesses adopt AI-powered solutions to improve efficiency and competitiveness.
Furthermore, Microsoft unveiled plans to invest $80 billion globally in data centers in 2025, a move that should boost demand for AI chips from suppliers like Nvidia. This development highlights the growing importance of AI infrastructure and Nvidia’s role as a leading provider of AI-accelerated computing solutions.
A Good Year Ahead?
Overall, these developments suggest that 2025 could be another good year for NVDA. As the company continues to execute its growth strategy, investors can expect further upside in the stock price.
The Shares Closed at a New High
The shares closed the day at $149.51, up 3.4% from previous close. This marks a new high for the stock, and investors who bought $1,000 worth of Nvidia’s shares 5 years ago would now be looking at an investment worth $25,268.
Is Now the Time to Buy Nvidia?
Access our full analysis report here, it’s free. Our report provides a comprehensive overview of Nvidia’s growth prospects, financial performance, and industry trends that are likely to drive its future success.
The Market Is Telling Us
Nvidia’s shares are very volatile and have had 23 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
However, investors who missed out on Nvidia’s past rallies may want to consider buying into the stock now, as it is trading at a new high. With a strong track record of growth and innovation, Nvidia remains an attractive investment opportunity for those seeking exposure to the AI industry.
The Biggest Move We Wrote About Over the Last Year
11 months ago when the stock gained 15.5% on the news that the company reported fourth-quarter results with a meaningful revenue beat, strong gross margin improvement, and EPS outperformance vs. Wall Street’s estimates.
This move was driven by several factors, including:
- Revenue growth of 265% year-on-year and 22% sequentially.
- Strong performance in the data center segment, which was up 409% year-over-year and 27% sequentially as demand for Nvidia processors optimized for generative AI, LLMs (large language models), and other AI workloads continued to accelerate.
- Guidance for the next quarter was also good, with revenue, gross margin, and implied operating profit coming in ahead of expectations.
The company noted that growth in the data center and professional visualization segments is expected to more than offset the anticipated seasonal decline in gaming. This trend is likely to continue in 2025 as more businesses adopt AI-powered solutions to improve efficiency and competitiveness.
Zooming Out
We think this was a great quarter that shareholders will appreciate. Nvidia is up 8.3% since the beginning of the year, and at $149.74 per share, has set a new 52-week high. Unless you’ve been living under a rock, it should be obvious by now that generative AI is going to have a huge impact on how large corporations do business.
While Nvidia and AMD are trading close to all-time highs, we prefer a lesser-known (but still profitable) semiconductor stock benefiting from the rise of AI. Click here to access our free report on our favorite semiconductor growth story.
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Note: The content provided is for informational purposes only and should not be considered as investment advice. It’s always recommended to consult with a financial advisor before making any investment decisions.
