Market: Nvidia exceeds the $1,000 mark with an AI rally

by Aditya Soni and Gokul Pisharody

(Reuters) – Nvidia jumped on the stock market on Thursday, the group’s forecasts having reinforced investor confidence in the explosion in demand for chips intended for artificial intelligence, which is driving the entire technology sector.

On Wall Street, around 2:30 p.m. GMT, Nvidia shares climbed 10.0121%, to $1,044.565, crossing the symbolic threshold of $1,000 for the first time in its history.

This translates into an increase in the market capitalization of the semiconductor specialist by more than $160 billion, bringing its valuation to $2.53 trillion.

In the wake of Nvidia, Micron Technology (+2.80%) and Broadcom (+1.34%) are well oriented, while the new technology index and the semiconductor index each advance by around 1, 7%.

The Standard & Poor’s 500 rose by 0.13% and the Nasdaq Composite by 0.68%, the latter two indices having set records at the opening of the session in New York.

JP Morgan, impressed by the growing scale of customer demand, sees Nvidia’s new Blackwell chip as a significant driver for fiscal year 2025. The intermediary raised its price target on the stock to $1,150.

For BoFA Global Research, Nvidia is growing its sales faster than other mega-caps and sees the group’s earnings per share exceeding $50 in the next two years, with more than $120 billion in free cash flow.

Nearly thirty intermediaries have raised their forecasts on Nvidia shares, with a median target of $1,180, according to LSEG data.

Nvidia’s 12-month price-to-earnings ratio is currently 34.7, compared to 38 for AMD and 26.8 for Super Micro Computer.

Nvidia, whose investors have high expectations, announced on Wednesday a turnover forecast for the current quarter higher than expectations, a split by ten of the nominal value of its share and an increase in its quarterly dividend by 150%.

“Companies continue to increase their capital spending, especially large technology companies, to respond to this revolutionary technology, and Nvidia is by far the biggest beneficiary,” notes Josh Gilbert, markets analyst at eToro.

Analysts welcomed comments from Nvidia executives that its new Blackwell AI chip would begin shipping in the current quarter and that demand for the processor could outstrip supply “well into next year.” “.

Nvidia Chief Executive Jensen Huang told Reuters he expected new AI models, capable of creating videos and providing human-like voice interactions, to further drive demand for its processors.

“With years ahead of the competition, we believe Nvidia can comfortably defend and maintain its market share,” said Ido Caspi, an analyst at Global X, a company that has invested in Nvidia.

“Continued demand for Hopper (Nvidia’s current chip) should help alleviate investor concerns about customers delaying purchases in anticipation of the transition to Blackwell,” he adds.

Analysts also noted that the stock split could make Nvidia more accessible to retail investors.

(Reporting by Aditya Soni and Gokul Pisharody in Bangalore; with contributions from Siddarth S and Shubham Batra in Bangalore, and Danilo Masoni in Milan; French version Claude Chendjou, editing by Kate Entringer)

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