Nvidia (NVDA 2.57%) recently gave investors more evidence that the surge in demand for its data center products powering artificial intelligence (AI) applications has more legs. That helped persuade Rosenblatt analyst Hans Mosesmann to continue to recommend investors buy the stock.
His firm’s $1,400 price target for Nvidia stock remains one of the highest on Wall Street. That represents upside of about 34% even after Nvidia shares popped following its fiscal 2025 first-quarter results. Nvidia shares have now more than doubled in 2024.
Nvidia beats expectations again
The strength in Nvidia’s AI business hasn’t been a secret for investors. Expectations have been high, but the company continues to surpass Wall Street’s, and its own, estimates. Consider that the three months ended April 28 marked the fourth straight quarter in which the company beat its own revenue guidance by at least $2 billion.
Year over year revenue by business segment increased as follows:
- Data center: 427%
- Gaming: 18%
- Ominverse: 45%
- Automotive and robotics: 11%
While the company is growing all areas, its data center AI business is what’s driving the stock right now. Mosesmann thinks that will continue, with the company outperforming expectations as Nvidia projects another meaningful jump in sales in the current fiscal quarter.
Nvidia wants even more of the AI pie
Some investors thought near-term demand would wane as customers wait for the more powerful Blackwell architecture. But clearly that hasn’t happened, and Blackwell shipments are expected to begin before the end of this year. In the earnings release, Nvidia CEO Jensen Huang commented, “We are poised for our next wave of growth. The Blackwell platform is in full production.”
The runway for growth in AI spending looks to be a long one. And Nvidia continues to innovate in other areas as well. The company wants to offer more and more value to customers. It is including software solutions with its server stack offerings.
That makes me think the $1,400 price target will only be a stop along the way to even higher prices.