Nvidia's Shares Reach New Record Following Anticipation Of Big Profits From Booming AI

Nvidia shares reached a new peak on Monday 5 February (photo: x @nvidia)

JAKARTA - Nvidia shares reached a new peak on Monday, February 5, after Goldman Sachs raised its price target for this rising chipmaker stock, to anticipate a massive increase in revenue due to the booming artificial intelligence (AI).

The shares rose about 4% to USD 689.21 (IDR 10.8 million) and potentially added around USD 70 billion (IDR 1.104.3 trillion) to the company's market cap. At the close of last Friday, Nvidia was valued at USD 1.63 trillion (IDR 25.7 quadrillion).

Nvidia has become an icon of the turmoil in the artificial intelligence industry and experienced the highest monthly market value surge in history in January. Despite rising by about 39% so far this year, its very high stock growth makes it more expensive than its competitors. Nvidia shares are trading around 31.4 times the company's future profit forecast, compared to an industry average of 22.9.

However, Goldman Sachs analyst Toshiya Hari sees that there is still room for further growth. "We believe Nvidia will remain the industry's gold standard in predictable time, given its strong hardware and software offerings, and, more importantly, its continued speed of innovation," Hari said.

Goldman Sachs analysts raised the price target for Nvidia to 800 US dollars, which is the third highest among American analysts covering the stock, indicating a 21% increase from the current level.

Previously, their target price was 625 US dollars. The bank also increased Nvidia's revenue forecast for the full year 2025-2026 by 22% on average, referring to signs of strong AI server demand and increased supply of graphics processing units (GPUs).

Hari points to signs of AI monetization from companies such as Microsoft and Meta Platforms Inc., as well as positive income prospects from Super Micro Computer AI server manufacturers.

Although Nvidia has earned billions of dollars in revenue thanks to the turmoil of the artificial intelligence industry, other chipmakers who are not deeply involved in chip manufacturing for AI, such as Intel, are slumped. Nvidia is scheduled to report financial results on February 21, with analysts estimating a fourth-quarter net profit per share of $4.51 and revenue of 20.19 billion US dollars.