Goldman Sachs Predicts Nvidia's Stock Rally Will Continue Despite $4 Trillion Market Cap

Goldman Sachs has initiated coverage on Nvidia with a Buy rating and a $185 price target, citing the company's strong position in AI, growing demand from a wider range of customers, and attractive valuation despite its recent rally. The analyst sees Nvidia as the leader in accelerated computing and notes its expanding customer base, rapid innovation, and early returns from the AI wave. The stock has a Strong Buy consensus rating and an average price target of $175.51, suggesting a potential upside of 7.75%.

Goldman Sachs has initiated coverage on Nvidia (NASDAQ:NVDA) with a Buy rating and a $185.00 price target, reflecting the investment bank's bullish outlook on the company's strong position in AI and growing demand from a wider range of customers. The analyst firm highlights Nvidia's leadership in accelerated computing, noting its expanding customer base, rapid innovation, and early returns from the AI wave.

Nvidia's stock has shown remarkable strength, gaining 21.3% year-to-date, and currently trading at $162.88. Despite recent choppy action due to "peak concerns" and the growing presence of custom accelerators in the market, Goldman Sachs identifies four key factors supporting its positive outlook: product leadership with rapid introduction cadence, broadening customer base, early signs of AI monetization, and attractive valuation [1].

The investment bank acknowledges that Nvidia's stock price has experienced volatility recently, but it believes the company's strengths position it to outperform compared to other companies in its coverage universe. Goldman Sachs' positive view aligns with the Strong Buy consensus rating and an average price target of $175.51, suggesting a potential upside of 7.75% [1].

In addition to Goldman Sachs' positive outlook, recent news indicates that Amazon Web Services (AWS) has introduced custom cooling hardware specifically designed for Nvidia's latest graphics processing units, integral to generative AI systems. The new In-Row Heat Exchanger (IRHX) cooling system combines liquid and air-based components to efficiently manage heat, allowing AWS to support Nvidia's high-density GPU racks without major renovations [1]. This development coincides with AWS launching new computing instances, EC2 P6e and P6e Ultra, which provide access to Nvidia's powerful server configurations.

Furthermore, Gorilla Technology Group has announced its partnership with Nvidia as an NVIDIA Solutions Partner, enhancing its capabilities in AI, smart city technologies, and cybersecurity. CoreWeave Inc has become the first to deploy Nvidia's GB300 NVL72 platform, setting a new benchmark for AI reasoning and performance, in collaboration with Dell Technologies (NYSE:DELL) and other partners [1]. IREN Limited has expanded its AI cloud by purchasing 2,400 next-generation Nvidia Blackwell GPUs, increasing its total GPU fleet to approximately 4,300 units [1].

CoreWeave, the AI Hyperscaler™, has made NVIDIA RTX PRO 6000 Blackwell Server Edition instances generally available, demonstrating its ability to be first to market with the world's latest and most advanced hardware solutions [2]. The new RTX PRO 6000-based instances achieve up to 5.6x faster LLM inference and 3.5x faster text-to-video generation than the previous generation, ideal for inference of models up to 70B parameters.

These developments underscore Nvidia's strong position in AI and its potential to continue driving growth and innovation in the market.

References:

[1] https://www.investing.com/news/analyst-ratings/goldman-sachs-initiates-coverage-on-nvidia-stock-with-buy-rating-93CH-4129356

[2] https://www.prnewswire.com/news-releases/coreweave-becomes-the-first-ai-cloud-provider-to-offer-nvidia-rtx-pro-6000-blackwell-gpu-at-scale-302500917.html