[ad_1]
(Reuters) – Nvidia shares hit a new high on Monday after Goldman Sachs raised its price target for the high-flying chipmaker’s stock in anticipation of a major boost to its profits from the rise of artificial intelligence ( AI).
The stock rose about 4% to $689.21 and looked like it would add about $70 billion to the company’s market capitalization. Nvidia was valued at $1.63 trillion at Friday’s close.
Nvidia has become a poster child for the AI frenzy and saw a record monthly jump in its market value in January.
The dizzying growth in the share price (which is already up around 39% so far this year) has made it more expensive to own relative to its peers. Nvidia shares trade at 31.4 times the company’s forward earnings estimate, compared to the industry average of 22.9.
Still, Goldman Sachs analyst Toshiya Hari sees more room for growth.
“We believe Nvidia will remain the industry’s gold standard for the foreseeable future, given its strong hardware and software offerings and, more importantly, the pace at which it continues to innovate,” Hari said.
Analysts at Goldman Sachs raised their price target on Nvidia to $800, the third highest among U.S. analysts covering the stock and indicating a 21% upside from current levels, according to LSEG data. Their previous price target was $625.
The bank also raised its full-year 2025-2026 earnings estimates for Nvidia by 22% on average, citing signs of strong demand for AI servers and improving supply of graphics processing units (GPUs).
Hari highlighted signs of AI monetization from companies like Microsoft and Meta Platforms, as well as the positive earnings outlook from AI server maker Super Micro Computer.
While Nvidia has unlocked billions in revenue thanks to the AI frenzy, other chipmakers that are not as involved in making AI chips, such as Intel, have seen their shares fall.
Nvidia will report its results on February 21, and analysts expect fourth-quarter earnings per share of $4.51 and revenue of $20.19 billion, according to data from LSEG.
(Reporting by Sruthi Shankar in Bengaluru; Editing by Saumyadeb Chakrabarty and Shweta Agarwal)