BofA’s Hartnett says concentrated U.S. stock returns are likely to persist
On Monday, Morgan Stanley (NYSE:MS) reiterated its Overweight rating on NVIDIA stock (NASDAQ:NVDA) with a $160.00 price target. The semiconductor giant, currently valued at $3.3 trillion with trailing twelve-month revenue of $130.5 billion, has demonstrated remarkable growth with revenue surging 114% year-over-year. According to InvestingPro analysis, NVIDIA maintains a perfect Piotroski Score of 9, indicating exceptional financial strength. The firm’s analysts focused on NVIDIA’s recent announcements, highlighting the NVlink Fusion as a significant development. This new interconnect technology broadens NVIDIA’s ecosystem, allowing integration with custom ASICs and non-NVIDIA CPUs, with Qualcomm (NASDAQ:QCOM) and Fujitsu as notable examples. Morgan Stanley analysts acknowledged the need for further analysis to understand the strategy’s full impact on the competitive landscape and customer choices, especially in comparison with the upcoming UAlink.
NVIDIA also introduced RTX PRO servers aimed at the enterprise AI inference market, featuring up to eight Blackwell RTX Pro Graphics 6000 cards and NVIDIA networking technologies. These servers will support the AI enterprise software platform, signifying NVIDIA’s commitment to expanding its enterprise solutions.
The company updated its robotics foundation model, Isaac GR00T, by adding a new framework for synthetic data generation named Isaac GR00T-Dreams. This enhancement is designed to improve training for humanoid robotics. Additionally, NVIDIA is nearing the customer availability of its first personal workstation computers, the DGX Spark and DGX Station, with the former expected to launch in July and the latter later in the year. With a gross profit margin of 75% and return on assets of 82%, NVIDIA’s product innovation continues to drive strong financial performance. Discover more detailed metrics and 20+ additional ProTips with InvestingPro.
In a strategic move to bolster its international presence, NVIDIA announced a partnership with Foxconn (SS:601138) and the Taiwan government to construct a new 10,000 Blackwell GPU supercomputer. TSMC is set to be the lead customer for this project, utilizing the supercomputer for R&D research. Moreover, NVIDIA has plans to establish a new office in Taiwan.
Morgan Stanley’s analysis also touched on NVIDIA’s challenges, including a $5 billion+ revenue headwind due to the U.S. Commerce Department’s ban on H20 sales in China. The early-year difficulties with the GB200 have also been problematic. However, the firm sees these intermediate-term concerns being addressed progressively and anticipates a strong second half of the year for NVIDIA. With the next earnings report due on May 28 and analyst targets ranging from $100 to $220, investors seeking comprehensive analysis can access NVIDIA’s detailed Pro Research Report, available exclusively on InvestingPro, along with advanced valuation metrics and peer comparison tools.
In other recent news, NVIDIA Corporation has been in the spotlight with several key developments. Mizuho (NYSE:MFG) Securities raised its price target for NVIDIA to $168, maintaining an Outperform rating, ahead of the company’s anticipated earnings report. The firm expects a mixed near-term performance but projects a strong second half of the year. Meanwhile, Raymond (NSE:RYMD) James reaffirmed an Underperform rating with a $150 price target, noting potential revenue headwinds due to recent H20 export restrictions but acknowledging strong product ramps that could drive future growth.
BofA Securities maintained a Buy rating and a $160 price target following NVIDIA’s CEO’s keynote at Computex 2025, highlighting the company’s expanding AI product portfolio. Additionally, NVIDIA announced the launch of NVLink Fusion, a new technology aimed at enhancing AI infrastructure capabilities, with several industry partners already adopting it. This innovation is expected to facilitate the integration of CPUs and GPUs, allowing cloud providers to scale AI factories significantly. NVIDIA’s management remains optimistic about the company’s prospects, anticipating robust hyperscale capital expenditure trends and growth in the Middle East market. These recent developments underscore NVIDIA’s strategic positioning in the evolving AI landscape.
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