"Bank of America slapped a $275 price target on stock. This is nowhere near the highest price target of $352, but it is still something to peek into, considering BofA is a major firm that has usually been more conservative. What's more puzzling is that this price target came at a time when big-name investors and "gurus" started doubting Nvidia's story."
"For example, Michael Burry implied that Nvidia was misrepresenting its earnings by what he sees as the delayed depreciation of GPUs. NVDA stock is now at a 10% discount since that price target was issued. Should you pay any heed to it, and is BofA's price target within reach in the near term? Let's take a look at what the analyst has to say."
"Bank of America called the AI skepticism healthy but overstated in the near to medium term, and believes the skepticism ensures that the space is not "overcrowded". They're basically implying that with bears being so skeptical, it is keeping the "bad money" out. Ergo, the NVDA stock rally is healthy. His team said that OpenAI spending has not yet peaked, and that Nvidia's $500 billion data center order disclosure for 2025 and 2026 means that the company can keep growing sales and profits"
Bank of America set a $275 price target on Nvidia, lower than some higher estimates but notable from a typically conservative firm. NVDA traded about 10% below that target after the note. Vivek Arya, a senior semiconductor analyst, provided the rationale and has a documented track record. The bank views AI skepticism as healthy and not indicative of an overcrowded market. The team expects OpenAI-related spending to continue rising and cites a disclosed $500 billion data-center order for 2025–2026 that could support sales and profit growth as high as 70% annually. The price target uses a 44x forward P/E for 2026, minus cash, which sits within Nvidia's historical forward valuation.
Read at 24/7 Wall St.
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