Wall Street’s advice after Nvidia hits historic $4 trillion market cap: BUY

JOSH EDELSON / AFPA day after Nvidia set a new record by reaching a $4 trillion market cap, at least three Wall Street analysts issued new reports that rated the stock a buy, according to Bloomberg data

The bulls pointed to Nvidia’s role as the premier chipmaker and the fact that compared to its fundamentals, the stock is still trading at a fair price

Wall Street is betting Nvidia can make stock market history again

The upside for Nvidia, according to its biggest bulls, remains incomplete

There are more returns to be had, they argue

Nvidia is one of the most beloved stocks by investors

It seems to have ridden the stock market exuberance of AI more than any other company

Investors continue to reiterate its strength as the purveyor of the best AI chips that hyperscalers Meta, Alphabet, and Amazon use

Of the 79 analysts who currently Nvidia, 69 rate it a buy, according to Bloomberg

Only 11 rate it a hold

And just one lone holdout lists it as a sell

At least three analysts published new reports rating the stock a buy, according to Bloomberg data

Goldman Sachs, Keybanc Capital, and Bocom International, the subsidiary of Hong Kong’s Bank of Communications, all listed Nvidia as either a buy or an overweight

Despite Nvidia’s valuation, its fundamentals don’t point to an expensive or overpriced stock, according to Paul Meeks, chief investment officer at 17 Asset Management. “The stock has come far, but sales, earnings, and cash flows have come farther,” he told Fortune

Indeed, Nvidia has dered outstanding financial performance

Its quarterly earnings saw it bringing $44 billion in revenue, a 69% increase from the prior year, according to company filings

Goldman was undeterred by Nvidia’s recent record valuation

It called worries Nvidia’s sky-high price “peak concerns” in an analyst note published on Thursday. “We believe Nvidia will remain the primary beneficiary of the AI infrastructure buildout,” Goldman semiconductor analyst James Schneider wrote

Analysts built their bull case for Nvidia around the fact that it remains the market leader in all the components used to develop AI systems and that the market for all of those ducts will only grow over the next few years

Nvidia has also spent the last couple years diversifying its offerings. “Nvidia’s well beyond the chips,” Meeks said

The company also has a suite of software and networking gear used for things gaming and robotics

Nvidia’s believers also often point to early signs that AI companies are finally starting to monetize the nology

Once that happens, demand for Nvidia’s ducts will only grow

AI firms have already started to push further into the consumer market

Perplexity released an AI-powered web browser and OpenAI is slated to launch one soon

Major cloud service viders Amazon and Alphabet will also start to incorporate more AI into their services which will only further boost Nvidia’s sales, according to longtime bull Dan Ives. “The impact of the AI cycle on consumer Internet will be massive and it will start with the cloud service divisions,” Ives wrote on Thursday. “[Amazon and Alphabet] acquire AI-capable chips, build AI-capable service offerings, and sell those services into their respective installed bases. ” But Nvidia’s fate is ultimately linked to that of its biggest customers

As they continue to spend, the stock will continue to soar

The day that they pull back their billions in AI investments is the day Nvidia’s gets “crushed,” Meeks said. “Only thing that would cause a bloodletting here is if we got a sense that major AI spenders pull back,” he said

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