Here’s Why Nvidia Stock Jumped Today

Nvidia (NASDAQ: NVDA) stock posted significant gains in Monday’s trading. The artificial intelligence (AI) leader’s share price climbed 4.1% in the daily session, according to data from S&P Global Market Intelligence.

Nvidia stock got a boost in today’s trading as investors and analysts reassessed the impact of a potential delay for the first generation of the company’s upcoming Blackwell processors. The company’s share price likely also got a boost from news that the graphics processing unit (GPU) frontrunner had signed a new AI training deal with the state of California.

Nvidia continues to rack up public sector wins

Nvidia has been touting the importance of developing AI systems for countries. The company anticipates a dramatic ramping of public sector spending to develop artificial intelligence systems as countries aim to shore up national defense capabilities and overall sovereignty. The announcement of the new training partnership with California reflects a similar dynamic on a U.S.-state level. It wouldn’t be surprising to see Nvidia announce additional AI training deals with other states in the near future.

Is Nvidia stock on track for more big gains?

UBS published a report on Nvidia today, maintaining a buy rating on the stock and a one-year price target of $150 per share. The artificial intelligence leader’s stock has seen volatile trading recently as investors have weighed concerns about expectations that its first Blackwell processors will be delayed. With the company closing out today’s daily session valued at roughly $109 per share, UBS’ price target suggests near-term upside of roughly 38%.

The first releases in the Blackwell line are expected to deliver a substantial leap forward in processing power and were expected to be a major performance driver for Nvidia this year. In general, the market has also shown some skittishness lately when it comes to valuations for megacap companies and leading AI players. But the bank thinks the tech stock is undervalued at current prices.

UBS expects that a potential delay for the first Blackwell processors would still have them releasing by the end of January 2025, and the bank’s analysts on the stock think overall demand for Nvidia’s processors will remain very strong. While some analysts have projected that the AI leader’s earnings will hit a near-term peak in 2025, UBS thinks profits will likely grow in 2026 as well.

Should you invest $1,000 in Nvidia right now?

Before you buy stock in Nvidia, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Nvidia wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Story continues

Consider when Nvidia made this list on April 15, 2005… if you invested $1,000 at the time of our recommendation, you’d have $641,864!*

Stock Advisor provides investors with an easy-to-follow blueprint for success, including guidance on building a portfolio, regular updates from analysts, and two new stock picks each month. The Stock Advisor service has more than quadrupled the return of S&P 500 since 2002*.

See the 10 stocks »

*Stock Advisor returns as of August 12, 2024

Keith Noonan has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Nvidia. The Motley Fool has a disclosure policy.

Here’s Why Nvidia Stock Jumped Today was originally published by The Motley Fool

Read The Full Article Here