BofA reiterated Nvidia Corporation (NASDAQ:NVDA) as one of its top picks after "solid meetings" with the company's CFO and head of gaming.
The firm has a Buy rating and $500 price target on the stock, and told investors that the meetings reassured them that NVDA's "recent surge of demand in data center is unique and sustainable, with no evidence of pull-ins or customer/regional concentration risk."
"NVDA's market share in AI inference has solid headroom as compute requirements in large language models are well above what traditional CPU can handle (currently 90%+ share of legacy inference)," the firm said, adding there are underappreciated opportunities for NVDA to expand its market from just AI accelerators into high-performance CPU, data processing and Mellanox Infiniband + Ethernet networking.
Elsewhere on Wednesday, JPMorgan reiterated an Overweight rating on NVDA, stating the company has "multi-quarter visibility in its data center business, combined with strong automotive and gaming trends."
The analysts also said they are optimistic about the demand from China, while Nvidia's supply/demand situation "looks good."