Nvidia stock was heading for new highs on Friday as Metaplatform and Amazon.com Inc.’s earnings reports boosted the technology sector. The results for major technology companies demonstrate Nvidia’s commitment to investing in hardware-backed artificial intelligence technology.
Nvidia shares rose 2.9% to $648.28 in early trading Friday. Shares closed 2.4% higher at $630.27 on Thursday.
While the tech sector as a whole is rebounding on the back of earnings, there was a lot of concrete push that Nvidia’s graphics processing units will remain in high demand for training AI systems.
Mehta said he expects full-year capital spending in 2024 to be in the range of $30 billion to $37 billion. This is up from prior guidance of $30 billion to $35 billion given three months ago.
“Meta’s commitment to AI is evidenced by its recently announced significant investment plan, which includes billions of Nvidia chips to build a powerful computing infrastructure for AI development. ,” said Mayuranki De, research analyst at Global X, an exchange-traded fund provider.
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Amazon was less specific about its guidance, but said it expected capital spending to increase due to investments in AI. Analysts expect capital spending to be $59.9 billion in 2024, up from $52.6 billion last year.
“Results from top U.S. cloud customers suggest solid motivation for cloud.
Spending at genAI [generative AI],” BofA Global Research analyst Vivek Arya wrote in a research note Friday.
As for Nvidia’s own future earnings report, BofA analysts expect it to hit 3% to 5% of consensus revenue estimates of $20 billion for the January quarter and $21.4 billion for the April quarter. He said there was.
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Aria raised his price target for NVIDIA stock from $700 to $800 and maintained a “buy” rating. The new target is based on NVIDIA’s price-to-earnings ratio of 31 times its expected 2025 earnings.
Nvidia was emerging alongside other computing hardware providers. Advanced Micro Devices rose 4.3% in early Friday trading, while Broadcom rose 1.7%.of
S&P500
rose 0.2%, while the Nasdaq Composite rose 0.6%.
Nvidia stock is up 27% year-to-date, with the S&P 500 and Nasdaq Composite up 2.9% and 2.3%, respectively, as of Thursday’s close.
Email Adam Clark at adam.clark@barrons.com.