Do Analysts Expect NVDA Stock to Rise More Even with Increased Competition from AMD?

Nvidia’s Stock Surge Amid AI Demand

Nvidia’s stock (NVDA) has seen a remarkable increase of 34.3% since the start of this year, largely fueled by strong demand for its graphics processing units (GPUs) in various artificial intelligence (AI) applications. The firm has also bolstered its standing in the market through strategic partnerships, such as a hefty $5 billion investment in Intel (INTC) and a significant $100 billion deal with OpenAI, the creator of ChatGPT.

Analyst Insights on NVDA Stock

However, there’s some hesitance among investors due to heightened competition from Advanced Micro Devices (AMD), which has recently entered into new agreements with OpenAI and Oracle (ORCL). Additionally, ongoing restrictions on chip exports to China are adding to the concerns. Despite this, many analysts are still optimistic about Nvidia’s growth in the long run, with Wall Street’s average price target indicating potential for further stock appreciation.

Mizuho Securities’ lead analyst, Vijay Rakesh, recently reaffirmed Nvidia’s “outperform” rating with a price target of $225. He highlighted that Nvidia maintains a dominant position in AI chips, commanding over 95% of the market share in AI data centers. Rakesh anticipates that this sector could expand by approximately 60% annually, potentially exceeding $500 billion by 2028, especially with new products like the GB200 and NVL72/36 servers expected to launch in 2025.

Meanwhile, HSBC analyst Frank Lee adopted a more optimistic outlook on Nvidia last week. He upgraded the stock from hold to buy and increased his price target from $200 to an impressive $320. Lee noted that Nvidia’s AI data center business is growing faster than anticipated, predicting robust profit increases through fiscal 2027. His forecast for FY27 revenue in data centers sits at $351 billion, which is about 36% above current market expectations. He also raised his earnings per share estimate to $8.75 compared to the market average of $6.48.

Lee pointed out the swift growth of the AI GPU market, driven by demand from major cloud companies like Amazon (AMZN) and Microsoft (MSFT), along with large AI initiatives such as OpenAI and Stargate. He did acknowledge that U.S.-China trade tensions pose a short-term risk but remains hopeful that Nvidia’s sales in China might bounce back if conditions improve by 2026, despite the challenges posed by Huawei’s competition.