The impressive surge in the value of Nvidia shares (NASDAQ: NVDA) that began at the end of 2022 is now almost two years old, with the chip giant delivering gains of 11x during this period.
An initial investment of just $100 in Nvidia stock a couple of years ago is now valued at over $1,100. Furthermore, it appears that the company’s remarkable performance could continue into 2025, driven by advancements in the artificial intelligence (AI) chip market.
Let’s delve into the reasons why Nvidia’s impressive streak may persist in the upcoming year.
Strong Blackwell demand and supply improvements to boost Nvidia in 2025
Consensus estimates project Nvidia to finish fiscal year 2025 with $125.5 billion in revenue, a 125% increase from the previous year. KeyBanc analysts anticipate revenue to reach $130.6 billion in the current fiscal year, fueled by the strong growth of Blackwell AI processors.
Nvidia’s sales of Hopper chips, particularly the H100 and H200 processors, are expected to rise in the second half of fiscal 2025 due to robust demand and enhanced supply. Suppliers are also working to meet the increased demand, with Foxconn building a production facility for Nvidia’s GB200 Grace Blackwell Superchip.
The GB200 Superchip, priced between $60,000 to $70,000, is in high demand, and Nvidia is expected to sell a significant number of units next year, generating substantial revenue.
TrendForce estimates that Nvidia could ship 60,000 units of GB200 NVL36 servers in 2025, potentially resulting in significant revenue for the company.
Mizuho forecasts strong sales of Nvidia’s AI graphics cards in 2025, indicating a potential increase in data center revenue. If realized, Nvidia could surpass analysts’ revenue projections for the next fiscal year.
Potential for further growth in 2025
Analysts anticipate Nvidia to achieve $177 billion in revenue in fiscal 2026, with estimates trending higher. The company’s expected revenue growth is set to drive impressive earnings growth as well.
Nvidia is positioned to sustain its growth momentum in 2025, with a median 12-month price target of $150 per share. The highest 12-month price target of $203 suggests significant potential gains for the stock.
Considerations for investing in Nvidia
Before investing in Nvidia, it’s important to note that the Motley Fool Stock Advisor team has identified what they believe are the 10 best stocks for investors to buy now, with Nvidia not included in the list. The recommended stocks could offer substantial returns in the future.
Reflecting on when Nvidia was recommended on April 15, 2005, investing $1,000 at that time would have yielded…
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