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Nvidia (NVDA) shares are extending gains on Friday after one of its major suppliers, Foxconn, issued guidance that confirmed the AI trade is far from over yet.
The electronics maker known more formally as Hon Hai Precision Industry expects its AI server revenue to exceed 1 trillion New Taiwanese dollars or about $30 billion in 2025.
Foxconn is currently building the world’s largest server manufacturing plant in Mexico. The site will produce servers equipped with Nvidia’s GB200.
Including today’s gain, Nvidia stock has rallied nearly 10% over the past five trading days.
Why Is Nvidia Stock Gaining on Foxconn’s Earnings Release?
Investors are returning to NVDA because Foxconn’s update reinvigorated the AI trade this morning signalling demand for the giant’s AI chips is bound to remain strong in 2025.
This helped ease some of the broader concerns that a tariffs-driven recession in the U.S. could prove to be a significant challenge for tech stocks, including Nvidia, this year.
Additionally, the upcoming GTC conference is being seen as a potential catalyst that could drive the Nvidia stock price further up in the coming months.
NVDA could announce new partnerships and offer more color on its Blackwell Ultra and Rubin architecture at the annual event starting March 17.
NVDA Seen Hitting $200 Over the Next 12 Months
Bank of America analyst Vivek Arya expects “attractive” announcements from Nvidia at its GTC conference.
These may include the chipmaker’s view on “long-term opportunity in autonomous cars, physical AI/robotics and quantum computing,” he told clients in a research note this week.
Arya’s “Buy” rating on NVDA stock is coupled with a $200 price target, which translates to potential upside of a whopping 65% from current levels.
Nvidia shares are attractive also because they’re going for about 25 times their forward estimated earnings – well below the AI stock’s average of 40 times over the past five years.
Wall Street Hasn’t Bailed on Nvidia Shares
Despite a meaningful surge in Nvidia stock in recent sessions, Wall Street remains uber bullish on the semiconductor behemoth.
The consensus rating on NVDA currently sits at “Strong Buy” with the mean target of about $176 indicating potential upside of some 45% from here.
