Nvidia Stock Rises on Optimism of an AI Arms Race Boost

Nvidia Stock

Nvidia Stock (NASDAQ:NVDA)

Following some optimistic remarks made by a Bank of America analyst named Vivek Arya on Tuesday on the possible profits that may accrue to the chipmaker as a result of advancements in artificial intelligence technology, Nvidia (NASDAQ:NVDA) stock increased by more than 4%.

Nvidia climbed higher after Arya reported that the company’s data center unit is poised to enjoy substantial revenue improvements due to the increased demand for AI technology and services. According to Arya, an “AI arms race” may cause Nvidia’s (NASDAQ:NVDA) data center sales to skyrocket in the next five years, causing them to become four times more than they are now.

The “complete stack” of accelerated hardware, systems, software, and developers that Nvidia (NASDAQ:NVDA) has puts the business in a position to “win the fledgling generative AI arms race among global cloud and corporate clients,” according to Arya. Due to this development, Arya increased his price objective on Nvidia stock from $215 to $255 per share while maintaining his buy recommendation on the company.

Nvidia stock and its shareholders have had a prosperous year so far, as the company’s stock price has increased by 46% since 2022 came to a close. Arya stated that even though “we could see some stock volatility” in the near term as a result of Nvidia’s share price gains, any pullback in the stock should be “short-lived” as investors prepare themselves for the company’s GTC conference in March. Arya’s comments about Nvidia’s share price gains were made.

Nvidia and Advanced Micro Devices all had risen, with AMD’s increase coming in at more than 3%. At the same time, Qualcomm, Applied Materials, and Broadcom all posted decreases.

Companies already actively competing in the AI sector demonstrated their strength on Tuesday. As the trading day proceeded, share prices for C3.ai (AI), Big Bear Ai, and SoundHound all went up by between 2.6% and 3.0%, respectively.

C3.ai (AI) had a bit of a bounce after large losses on Monday. These losses were brought on by news that certain politicians in the United States were looking at new methods to control the artificial intelligence business.

Featured Image: Megapixl © Savconstantine

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