Shares of Nvidia (NASDAQ: NVDA) gained in morning trading on Friday after top-rated Morgan Stanley analyst Joseph Moore upgraded the stock to a Buy from a Hold and raised the price target to $304 from $255. Moore’s price target implies an upside potential of 15.7% at current levels.
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The analyst noted that the trend of artificial intelligence (AI) had become too much of a “megatrend” to ignore and this trend is likely to dominate any other trends. Moore noted, “The stock will continue to be hard to ignore in an otherwise challenging semiconductor environment.”
Moore pointed out that the enthusiasm for large language models has seen spending increasing both over the short-term and long-term as products such as ChatGPT and other AI workloads are now seen as “one of the most significant developments in technology since the development of mobile internet.”
As a result, the analyst is of the view that Nvidia will have “dominance in the training market that is likely to persist for several years even with a relatively fixed number of model developers, model complexity plus multiple languages should still drive 3-5x growth in training over 5 years.”
Analysts are cautiously optimistic about NVDA stock with a Moderate Buy consensus rating based on 25 Buys, five Holds, and two Sells.
