DA Davidson maintains NVIDIA stock Neutral with $135 target

On Monday, DA Davidson reiterated its Neutral rating on NVIDIA Corporation (NASDAQ:NVDA) shares, maintaining a price target of $135.00. The firm’s analyst, Gil Luria, highlighted the impact of recent advancements in artificial intelligence (AI), particularly noting the significance of the introduction of DeepSeek. According to InvestingPro data, NVIDIA boasts impressive financial metrics with revenue growth of 152% and industry-leading gross margins of 76%. Luria’s comments come after a series of events that have shaped the industry’s landscape, including Microsoft (NASDAQ:MSFT) and Meta Platforms (META) earnings reports, as well as the release of OpenAI’s o3.

Luria pointed out that AI efficiency has seen a dramatic improvement in the past weeks, with evidence suggesting that computational needs have been reduced by 90-97%. This assessment is based on a variety of interactions, including conversations with investors, corporate executives, and technologists, as well as a well-attended investor call hosted by DA Davidson. NVIDIA maintains its position as a prominent player in the semiconductor industry, with a perfect Piotroski Score of 9, indicating exceptional financial strength.

The analyst also addressed counterarguments to the firm’s stance, providing a detailed response to each point of pushback received. The firm’s perspective is further supported by observations from colleague Alex Platt, who has also published insights on the implications of o3 and the direction of AI following the release of R1.

DA Davidson’s continued Neutral stance on NVIDIA indicates a cautious optimism about the company’s position in the rapidly evolving AI space. The price target of $135.00 reflects the firm’s assessment of NVIDIA’s stock value in light of these technological developments and market dynamics. For a deeper understanding of NVIDIA’s valuation and growth prospects, InvestingPro subscribers can access comprehensive analysis including 20+ additional ProTips and detailed financial metrics in the Pro Research Report.

In other recent news, Nvidia, the global leader in accelerated computing, is set to hold its Q4 and fiscal year 2025 earnings call on February 26. This announcement follows the recent developments involving Nvidia’s AI chips and their use by Chinese AI firm, DeepSeek. Amid concerns about DeepSeek’s reliance on Nvidia’s AI chips, U.S. Congress members John Moolenaar and Raja Krishnamoorthi have urged for export control on these chips.

In response to these issues, Nvidia clarified its revenue situation regarding Singapore and China, stating that revenue from Singapore does not suggest a diversion to China. Furthermore, Nvidia’s CEO, Jensen Huang, is scheduled to meet with President Trump, a move that follows DeepSeek’s release of a cost-effective model that utilizes old Nvidia GPUs.

Additionally, Mark Zuckerberg, CEO of Meta Platforms Inc (NASDAQ:META)., discussed the potential impact of DeepSeek on the company’s infrastructure and capital expenditure trajectory, stating it’s too early to form a strong opinion. These developments represent the latest updates for Nvidia and related companies.

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