How are energy investors positioned?
UBS maintained its buy rating and $175.00 price target on Nvidia (NASDAQ:NVDA) Tuesday, citing the chipmaker’s expanding customer base and visibility into substantial future AI infrastructure investments. According to InvestingPro data, NVDA’s stock is trading near its 52-week high of $153.13, with remarkable revenue growth of 86% over the last twelve months.
The research firm noted that Nvidia now has "line of sight" to approximately $1.5 trillion of AI infrastructure investment over the next several years, consistent with previous company commentary about "tens of gigawatts" of projects within a two-to-three-year timeframe. The company’s financial health score is rated as EXCELLENT by InvestingPro, with a robust gross profit margin of 70%.
UBS highlighted that Nvidia’s demand is broadening beyond U.S. hyperscalers to include sovereign states and brownfield industries, while the company’s supply chain, software stacks, and product cadence are scaling accordingly.
The firm pointed out that Nvidia expects to generate $40-50 billion in revenue per gigawatt of AI data center capacity, potentially implying datacenter revenue of around $400 billion annually for the company.
This projected figure is approximately double UBS’s current estimate of $233 billion for calendar year 2026, which the firm believes should address investor concerns about near-term or medium-term earnings peaks.
In other recent news, Micron Technology Inc (NASDAQ:MU) has been chosen by Nvidia Corp as the first supplier for its next-generation memory solution, SOCAMM. This development gives Micron an early advantage in the AI server memory market, where it has outpaced competitors Samsung (KS:005930) and SK Hynix in securing Nvidia’s certification for production. Additionally, Nvidia has announced a collaboration with Novo Nordisk (NYSE:NVO) to accelerate AI-powered drug discovery. This partnership will utilize Nvidia’s DGX SuperPOD technology and BioNeMo platform to enhance research and development in life sciences. Beamr Imaging Ltd also revealed plans to launch a new video compression solution for autonomous vehicles, leveraging Nvidia’s accelerated computing to address storage demands. Meanwhile, Nvidia is set to conduct its 2025 Annual Meeting of Stockholders virtually, providing a platform for shareholders to vote and engage with the company. These developments highlight Nvidia’s ongoing efforts in expanding its technological and strategic partnerships across various sectors.
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