AI optimism continues to boost Nvidia shares

Nvidia continues its impressive stock rally at the beginning of the week, following positive short-term outlook forecasts from renowned Wall Street analysts for the tech giant. The company's stock, which has gained approximately $780 billion in market value since early September, has displaced Microsoft from the position of the second most valuable company in the world over the past week. The increased investor interest is attributed to Nvidia's dominant position in the global market for AI chips and processors, which benefits from massive investments. Nvidia's closest competitor, Advanced Micro Devices, has raised its forecasts for the market for AI accelerator chips, which power large language models for Microsoft, Alphabet, and Meta Platforms, to an impressive $500 billion over the next three years. These chips are becoming increasingly important in the context of companies' multi-cloud strategies, supported by Nvidia's performance and broad installation base. Analysts from Citigroup and Goldman Sachs see further potential for Nvidia. Citigroup analyst Atif Malik maintains his price target of $150 and praises Nvidia's strong market share among the largest US hyperscalers. Meanwhile, Toshiya Hari of Goldman Sachs raises his price target assessment due to the growing complexity of AI workloads. The rising demand for more complex AI computing models could significantly boost Nvidia's GPU sales and secure a market share of over 30% among US cloud providers. The company also receives support from its chip supplier Taiwan Semiconductor, which recently presented strong quarterly figures.