In a report released today, Cody Acree from Benchmark Co. reiterated a Buy rating on Nvidia, with a price target of $220.00.
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Cody Acree has given his Buy rating due to a combination of factors surrounding Nvidia’s strategic partnership with OpenAI. This collaboration involves OpenAI deploying a significant number of Nvidia systems, including GPUs and interconnectivity solutions, to build AI data centers. The expected return on Nvidia’s investment in this partnership is substantial, with projections indicating a 400-500% return, translating to $400-$500 billion over time.
Despite the non-exclusive nature of the agreement, which allows OpenAI to explore other partnerships, the potential growth in AI data center capacity aligns with industry trends. A McKinsey report forecasts a 3.5-fold increase in AI workloads by 2030, suggesting strong demand for Nvidia’s products. While the immediate financial impact is not fully integrated into current models, the long-term benefits and strategic positioning reinforce the Buy rating.
In another report released today, Barclays also maintained a Buy rating on the stock with a $200.00 price target.