Nvidia (NASDAQ:NVDA) stock has traded sideways over the last month. But it likely won’t be long before this leading AI stock is once again running higher. Nvidia stock seems to have lost its mojo following a 10-for-1 stock split executed in June.
The hand-wringing has intensified in recent days as investors rotate out of tech names nd into blue-chip value stocks. However, much of the worry is misplaced. Analysts predict Nvidia will consolidate before rising again. The company’s Q2 financial results on Aug. 28 could move the share price.
Analysts Remain Bullish
While NVDA has dipped 2% over the past month, or since its stock split, Wall Street analysts remain extremely bullish on the company and its prospects. Each day seems to bring a new analyst upgrade for Nvidia stock.
Recently, analysts at both UBS (NYSE:UBS) and Wolfe Research lifted their ratings and price targets on Nvidia stock, highlighting ongoing demand for the company’s microchips and processors that drive artificial intelligence applications and models.
UBS raised its price target on NVDA stock to $150 a share from $120, while Wolfe Research also upped its price target to $150. Both firms maintained “buy” equivalent ratings on Nvidia.
Beyond its AI chips and processors, analysts say Nvidia is likely to also gain from growing sales of its AI servers. It’s worth noting that Nvidia currently holds a “strong buy” rating among 41 analysts who cover the company.
The median price target on the company’s shares is 10% higher than where they currently trade.
Analysts continue to see upside for Nvidia stock even after it has nearly tripled in the last 12 months.
Leading The AI Race
What has Wall Street so bullish is not only the soaring demand for Nvidia’s chips but also the speed at which the company is advancing its technology and announcing new products.
In June, Nvidia unveiled its next generation of AI chips named “Rubin,” which arrive after the company previously announced its “Blackwell” line of microchips in March of this year.
Nvidia executives have said that the company plans to release new AI chips every year rather than every two years as was previously the case. Nvidia remains the market leader in AI chips with a 75% share of the global market.
For this year’s second quarter, Nvidia forecast revenue of $28 billion. That’s ahead of analysts’ consensus expectation of $26.66 billion and would represent year-over-year growth of 107%.
Buy Nvidia Stock
There were a lot of milestones for Nvidia in this year’s first half. Not only did the company’s share price more than double, but Nvidia achieved a $3 trillion market capitalization and split its stock on a 10-for-1 basis.
After so many momentous events, it’s not surprising that the stock has taken a breather. But it likely won’t be long before the stock is breaking out again.
The company’s upcoming Q2 print could be the catalyst that reignites a fuse under the shares. Nvidia stock remains a buy.
On the date of publication, Joel Baglole held a long position in NVDA. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
On the date of publication, the responsible editor did not have (either directly or indirectly) and positions in the securities mentioned in this article.
