Nvidia’s stock (NVDA) experienced a notable increase of over 4% on Wednesday, reaching a new high of $154.31, marking a significant turnaround since the start of the year. On Thursday, shares rose more than 1% in pre-market trading.
Previously, Nvidia’s shares had closed at a record $149.43 on January 6. During Wednesday’s session, the stock also hit new intraday highs.
Shares of AI chip makers have surged following the report of strong first-quarter revenues in late May, which exceeded Wall Street’s expectations. This indicates that Nvidia is thriving, even with a recent export ban affecting sales to China, one of its largest markets.
Since Nvidia’s earnings report on May 28, the stock has increased by more than 14%, while the S&P 500 (^GSPC) has seen a modest rise of about 3.4% in the same timeframe.
Loop Capital analyst Anandavarua has raised the price target for Nvidia, setting it at $250, which, according to Yahoo Finance, is the highest among Wall Street analysts. This suggests a potential market capitalization increase from the current $3.6 trillion to $6 trillion.
In a note to clients, Barua noted that while Nvidia’s fundamentals may continue to improve, the company has established itself as a critical technology monopoly with considerable pricing power. Moreover, Loop Capital forecasts that the AI chip market could expand to $2 trillion by 2028.
However, questions still loom about AI infrastructure demand, as major tech firms continue to invest heavily, often spending more on technology than they actually earn.
Nvidia’s shares faced challenges earlier in the year when the stock market reacted to trade tensions and developments in the tech sphere. After reaching record highs in January, the stock saw a decline due to concerns over competition from a new AI model developed by the Chinese startup Deepseek. Subsequent tariff announcements from the Trump administration also led to further drops in stock value, with projected losses running into the billions.
Complicating matters, Nvidia’s competition in China has intensified, especially from Huawei, which is reportedly working on new AI chips that could rival Nvidia’s earlier H100 models.
Nvidia’s stock was at its lowest closing price in over a year on April 4, ending the session above $94. Prior to the first-quarter revenue report, the stock gained momentum in May, thanks in part to significant contracts in Saudi Arabia and the UAE, where Nvidia supplied vast numbers of AI chips. This rebound helped Nvidia surpass Microsoft (MSFT) as the world’s most valuable company in early June.
This upward trend seems to coincide with an influx of investment into tech stocks. Analysts from Bank of America noted a spike in technology investments last week, the highest since June 2024.
On a related note, the Nasdaq 100 (^ndx) also closed at a new high on Tuesday, while the Nasdaq Composite (^ixic) reached its highest point since February.
