NVIDIA Stock Boosted by US-China Chip Agreement Reports

NVIDIA Corporation (NVDA) has received a bullish call from Bank of America, reiterating its "Buy" rating amid reports of a favorable deal for chip export licenses. The stock has a consensus "Buy" rating and an average price target of $190, implying a 5.10% upside. However, the Street-high target of $250 implies an upside of 38%. The company specializes in AI-driven solutions for data centers, self-driving cars, robotics, and cloud services.

NVIDIA Corporation (NVDA) has received a bullish call from Bank of America, reiterating its "Buy" rating amid reports of a favorable deal for chip export licenses. The stock has a consensus "Buy" rating and an average price target of $190, implying a 5.10% upside. However, the Street-high target of $250 implies an upside of 38%. The company specializes in AI-driven solutions for data centers, self-driving cars, robotics, and cloud services [1].

The deal involves the U.S. government demanding 15% of H20 chip revenue for sales to China. This move is seen as a way to keep Chinese industry at a disadvantage in the AI race. While the deal allows NVIDIA to restart H20 chip sales to China, the 15% revenue share is a significant reduction from the full revenue [2].

Wells Fargo has also raised its price target for NVIDIA to $220, citing higher data center segment sales and the restart of H20 sales to China. The analyst Stacy Rasgon at Bernstein, however, expressed concerns about the precedent this deal sets, noting the potential for a slippery slope in terms of controlled products and other companies being required to pay to sell into the region [2].

The stock has been on a 11-week winning streak, and Monday's session saw NVIDIA bumping against its all-time high of $183.88. The Relative Strength Index (RSI) is overbought at 73, but bulls are looking to the overhanging top trendline that provides a resistance level just above $200. Prior resistance at $153 could become support, along with the 26-week and 52-week Simple Moving Averages (SMAs) providing support in the mid-$130s [2].

Despite the positive sentiment, the broader market is mixed, with the Dow Jones Industrial Average (DJIA) falling 0.4% while the NASDAQ clings to 0.2% gains. US Treasury yields are lower across the curve, reflecting expectations of interest rate cuts next month [2].

References:

[1] https://www.cnn.com/markets/stocks/NVDA
[2] https://www.fxstreet.com/news/nvidia-pushes-all-time-high-as-wells-fargo-hikes-price-target-to-220-202508111800