The following content does not constitute investment advice. The author does not hold any positions in the stocks mentioned herein.
NVIDIA’s Promising Outlook for 2025
As 2024 draws to a close, NVIDIA stands on exceptionally solid ground. The upcoming year could yield significant opportunities if the GPU giant meets the ambitious expectations set by Wall Street. Recently, Truist Securities has heightened these expectations by factoring in a new product segment into their price target calculations for NVIDIA.
Revised Price Projections and New Product Potential
NVIDIA $NVDA price-target raised to $204 (from $169) at Truist Securities, implying +54% upside.
Analyst Will Stein expects Nvidia to announce a client-side CPU in 2025, which would unlock an additional $35 billion in TAM:
“Incrementally constructive on AI dominance & client…
— Stock Talk (@stocktalkweekly) December 16, 2024
Analyst Will Stein from Truist Securities has significantly impacted market expectations by projecting the introduction of a client-side CPU from NVIDIA in 2025. This new offering is anticipated to expand NVIDIA’s Total Addressable Market (TAM) by approximately $35 billion.
AI Market Leadership and Future Developments
“We believe NVDA will announce a client-side CPU during 2025, opening up an additional ~$35B TAM.”
Stein remains optimistic about NVIDIA’s position as a leader in artificial intelligence (AI), emphasizing the company’s ongoing advancements and its full technology stack’s prowess. He highlighted that NVIDIA’s recent success is largely attributed to a surge in AI demand over the past two years.
Price Target Adjustments
Reflecting this optimism, Truist Securities has raised NVIDIA’s price target from $169 to $204, which suggests a potential upside of around 54% from its current market value.
New AI Server Innovations on the Horizon
Looking ahead to 2025, NVIDIA’s next-generation “Blackwell Ultra”GB300 AI servers are set to launch around mid-year. Although the initial rollout faced minor design complications, significant enhancements are anticipated as the Blackwell architecture expands.
Moreover, there are reports indicating ongoing negotiations between NVIDIA and TSMC to manufacture Blackwell GPUs at TSMC’s facilities in Arizona. This development is particularly noteworthy following the recent $6.6 billion funding awarded to TSMC by the outgoing Biden administration to bolster production capabilities in that region. Commercial operations in Arizona are projected to initiate in the first half of 2025.
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