Major investment firm initiates coverage on Nvidia stock

Amid a recent lackluster performance of Nvidia (NASDAQ: NVDA) stock following its earlier stellar advances, financial services and investment banking giant William Blair has initiated its coverage on NVDA shares, with expert Sébastien Naji sharing his reasoning.

Specifically, William Blair’s analyst expressed optimistic sentiment regarding Nvidia’s future, initiating coverage on NVDA stock with an ‘outperform’ rating, as he took into account its previous performance in terms of demand for its products and its revenue so far, on September 18.

William Blair’s reasoning

Indeed, as Naji explained, Nvidia’s strong performance is likely to continue, referring to the still ongoing widespread artificial intelligence (AI) craze and Nvidia’s data center profits to date, albeit without providing a specific price target for the next 12 months:

“The rising AI tide has catapulted parallel computing to the forefront of the tech industry and has driven massive demand for the company’s GPUs and parallel computing stack. As evidence, Nvidia’s data center revenue grew 217% in fiscal 2024 and is expected to grow 132% in fiscal 2025, exceeding $110 billion in revenue (up dramatically from $15 billion in fiscal 2023).”

Furthermore, the William Blair analyst highlighted Nvidia’s “broader system-level approach,” extending its total addressable market (TAM) from around $100 billion in GPUs to the $800 billion semiconductor and $1.6 trillion cloud services markets.

Nvidia stock prediction

Meanwhile, Naji is one of the more bullish analysts on Wall Street who have provided their Nvidia stock ratings and/or price targets in the past three months and offered a consensus of a ‘strong buy’ score on it, with an average price target for the next 12 months at $153.24 (+34.27%).

Other analysts sharing their views of NVDA stock include the team from Bernstein, which pointed out that sustainability might be the main concern for Nvidia after its massive growth, but that “time to worry is clearly not now,” while Morgan Stanley retained its “top pick” rating, arguing that:

“Nvidia gross margins are likely to come down slightly, but the concerns are overblown in our view. (…) There are several potential puts and takes on gross margins, but the biggest will be the decision to move to a more aggressive product positioning, including the annual product cadence, and the decision to price Blackwell for good value.”

Nvidia stock price history

For the time being, the price of Nvidia stock stands at $117.03 in pre-market, indicating an increase of 3.17% on the day, a decline of 4.41% across the past week, and an accumulated loss of 8.03% in the last month, while racing 142.95% year-to-date (YTD), according to the data on September 19.

So, why is Nvidia stock going down today? Notably, the semiconductor behemoth’s recent weak performance coincides with the rest of the sector slowing down after the intense growth earlier this year and might be the result of speculation surrounding a possible AI ‘bubble.’

It is also worth noting that Nvidia stock might be preparing for a massive breakout after forming a “beautiful cup and handle” pattern on the hourly chart and breaking out from a descending broadening wedge, as observed by pseudonymous stock market analyst imposiblebull.

All things considered, banking giants like William Blair initiating their Nvidia coverage on such a strong note is a bullish sign for the stock, but doing one’s own research, like finding out when will NVDA stock split, Nvidia price prediction, when does NVDA report earnings and the like, is critical when investing.

Buy stocks now with eToro – trusted and advanced investment platform

Disclaimer: The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk.