Citi, on Wednesday, reaffirmed its Buy rating and $150.00 price target for NVIDIA Corporation (NASDAQ: NASDAQ:NVDA), following the company's announcement of a new service aimed at boosting generative AI for enterprises.
NVIDIA introduced the NVIDIA AI Foundry service in conjunction with NVIDIA NIM inference microservices, leveraging Meta (NASDAQ:META)'s Llama 3.1 models, which are openly available.
"Geared towards enterprises and nations, this service aims to help create custom supermodels for their domain-specific industry use cases leveraging Llama 3.1 in addition to NVIDIA software, computing infrastructure, and expertise," said a Citi analyst.
The launch, revealed on Tuesday, is seen by Citi as a significant step for NVIDIA in addressing the growing demand for AI solutions in the enterprise sector. The analyst pointed out the importance of the range of models available to enterprises when selecting AI cloud platforms or services. NVIDIA's move is perceived as a strategic effort to unlock further AI potential for businesses.
The NVIDIA AI Foundry service is expected to be a focal point at the upcoming SIGGRAPH 2024, where both NVIDIA and Meta are anticipated to showcase their collaborative efforts in AI beyond AI GPU technology.
NVIDIA's new service offering is part of its broader strategy to penetrate the enterprise market with advanced AI solutions. The company's collaboration with Meta and the integration of Llama 3.1 models into its services are indicative of NVIDIA's commitment to expanding its reach and influence in the AI space.
Meanwhile, Nvidia has approved the use of Samsung (KS:005930)'s fourth-generation high bandwidth memory chips for a specific graphics processing unit tailored for the Chinese market. The company has also unveiled its Nvidia AI Foundry service to enhance generative AI capabilities for global enterprises.
At the same time, Barclays has raised its 2024 forecast for the S&P 500 index, driven by an expected sustained profit growth among major technology companies, including Nvidia. Meanwhile, Piper Sandler increased Nvidia's price target from $120.00 to $140.00, maintaining an Overweight rating on the stock.
InvestingPro Insights
In light of NVIDIA Corporation's (NASDAQ: NVDA) recent announcement and Citi's reaffirmed Buy rating, examining some key metrics and InvestingPro Tips can provide additional context for investors. NVIDIA's market capitalization stands at a robust $2920.0 billion, reflecting the company's significant presence in the industry. The P/E ratio, a measure of the company's current share price relative to its per-share earnings, is high at 70.9, suggesting that investors are expecting high earnings growth in the future. This is supported by a substantial revenue growth of 208.27% over the last twelve months as of Q1 2025, which underscores NVIDIA's expanding market reach and the success of its strategic initiatives.
InvestingPro Tips highlight NVIDIA's perfect Piotroski Score of 9, indicating strong financial health, and analysts' anticipation of sales growth in the current year, aligning with the company's forward-looking AI service offerings. Additionally, NVIDIA's stock has delivered a strong return over the last year, with a 174.87% price total return, showcasing the company's robust performance and investor confidence.
For investors seeking more in-depth analysis and additional InvestingPro Tips, they can visit InvestingPro's NVIDIA page. There, they will find 19 additional tips that could help in making informed investment decisions. To enhance their experience, users may use the coupon code PRONEWS24 to get up to 10% off a yearly Pro and a yearly or biyearly Pro+ subscription.
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