Nvidia’s Phenomenal Rally Continues as Analyst Projects $5 Trillion Valuation

Nvidia Corporation is on a remarkable upward trajectory, with shares surging over 200% in the past year. A leading analyst now predicts that the semiconductor giant’s rally will push its market capitalization to nearly $5 trillion within the coming year. This projection underscores Nvidia’s meteoric rise and its expanding influence in the tech sector.

Nvidia’s stock has soared more than 200% over the past year, driven by robust demand for its cutting-edge AI chips and data center solutions. This extraordinary growth has led Rosenblatt Securities analyst Hans Mosesmann to revise his price target for Nvidia to a Wall Street high of $200, up from $140. Mosesmann’s optimistic outlook follows Nvidia’s 10-for-1 stock split on June 10, a strategic move that has further fueled investor enthusiasm.

On Tuesday, Nvidia’s shares climbed as much as 2.7%, reaching new intraday highs and reflecting the market’s confidence in the company’s future. Nvidia’s products, renowned for their role in powering data centers that handle complex AI computing tasks, have solidified the company’s market dominance. The Santa Clara-based company continues to outpace competitors, leveraging its advanced semiconductor technology to meet the growing demands of AI and data processing.

Mosesmann, who has consistently maintained a buy rating on Nvidia since 2017, highlighted the emerging importance of software in complementing Nvidia’s hardware prowess. In a note to clients, he emphasized that “the real narrative lies in the software that complements all the hardware goodness.” He anticipates that Nvidia’s software solutions will significantly contribute to its sales mix over the next decade, enhancing the company’s valuation due to the sustainability of this revenue stream.

Nvidia is a favorite among sell-side analysts, with 64 buy ratings, seven holds, and just one sell rating, according to Bloomberg data. “We anticipate this software aspect will significantly increase in the next decade in terms of overall sales mix, with an upward bias to valuation due to sustainability,” Mosesmann reiterated, highlighting the long-term growth potential.

With shares rising 165% in 2024 alone, Nvidia has added more than $2 trillion to its market cap, positioning it to potentially surpass Microsoft and Apple as the world’s most valuable company. This rapid ascent reflects Nvidia’s strategic focus on AI and data center markets, which continue to drive substantial growth and investor confidence.

For a comprehensive analysis of Nvidia’s market performance and future prospects, visit Fortune.