$NVDA Nvidia’s stock could win big amid ‘AI arms race,’ says BofA analyst
Emily Bary
Published: Feb. 14, 2023 at 12:10 p.m. ET
Instead of placing bets on which software companies will rise to the top in artificial-intelligence-powered search, perhaps investors should look below the surface.
BofA Securities analyst Vivek Arya is upbeat about Nvidia Corp.’s NVDA, +4.64% ability to capitalize on the push that companies are making to bake artificial intelligence into their offerings — a push that has become frenzied thanks to the recent success of OpenAI’s ChatGPT.
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“[Nvidia’s] full-stack of accelerated silicon/systems/software/developers positions it uniquely to lead the nascent generative AI arms race among global cloud and enterprise customers,” Arya wrote in a Monday note to clients.
Nvidia is a “top compute pick” for Arya, and he’s feeling even more bullish lately. He upped his price objective to $255 from $215 Monday while maintaining a buy rating, “as AI adoption potentially catalyzes long-term data center growth.”
He expects that generative AI will increase to $62 billion the total addressable market for accelerators, which can help process AI tasks more efficiently and deliver “near-instantaneous results.”