AI High: Shares of NVIDIA and AMD soar to a record high as analysts express optimism about AI hardware
The value of the stocks of AMD and NVIDIA increased significantly during the week. The price of NVIDIA's stock increased by 3% to $563.65, setting a new record. AMD saw a strong 7.5% increase at the same time, and its stock price of $157.57 was its highest in the previous two years.(Source:firstpost.com)
Shares of both NVIDIA and Advanced Micro Devices (AMD) saw substantial gains throughout the week, fueled by investor optimism surrounding the growing demand for AI-powered chips. This prompted Wall Street analysts to revise their price targets upwards for these industry leaders.
NVIDIA currently holds a dominant position in the advanced AI chip market, but AMD is expected to make significant strides in the coming year. According to Barclays analysts, led by Tom O’Malley, AMD is poised to gain ground as it increases deliveries of its own chips to enterprise customers. Supply constraints have led customers to utilize the entire NVIDIA platform to secure priority shipments of accelerators. Analysts predict that 2024 will witness the opening up of the AI market, with other chipmakers, including AMD, gaining substantial market share.
In response to this positive outlook, NVIDIA’s stock surged by 3%, reaching a new record high of $563.65. Concurrently, AMD’s shares experienced a robust 7.5% increase, reaching $157.57, marking their highest level in over two years.
Over the previous year, NVIDIA’s shares tripled, establishing the company as the world’s most valuable chipmaker, while AMD’s shares more than doubled. In line with this bullish trend, Barclays raised its price target for AMD shares from $120 to $200, and KeyBanc analysts increased theirs to $195 from $170.
NVIDIA also received a price target hike from KeyBanc, moving from $650 to $740. Both stocks are leading gainers in the industry-wide PHLX semiconductor index, which is up 1.15% in the session.
The 53 analysts covering NVIDIA’s stock have a median price target of $625, which is marginally lower than the $627.50 goal from one month ago. All of the analysts have issued a “buy” recommendation for the company, according to LSEG data. On the other hand, the 47 analysts covering AMD’s shares set a median price target of $145, up from $130 a month ago, also unanimously recommending buying the stock.
Responding to tightened US export rules, NVIDIA plans to commence mass production later this year of an AI chip specifically designed for its Chinese customers. In December, AMD challenged NVIDIA’s flagship microprocessors by announcing two new AI data center chips. As these heavyweights of the semiconductor industry position themselves for development and innovation, the competition for dominance in the AI chip market only gets more intense.(Source:firstpost.com)
