- Nvidia reported revenue that barely exceeded Wall Street’s expectations, triggering an 8.5% stock slide as investors hoped for more outperformance. But Bank of America said that Nvidia is still a solid investment and raised its price target 5%. Regardless of the DeepSeek drama and Chinese trade implications, the company continues to roll out Blackwell chips that have blown past sales projections.
Analysts from Bank of America still think that Nvidia is a buy and have increased their price target on the stock despite some disappointment from fourth-quarter results.
While Nvidia beat estimates late Wednesday, it wasn’t by much, as revenue rose 78% from a year ago to $39.3 billion, edging Wall Street’s projection of $38.3 billion. Nvidia also forecasted its first-quarter revenue will come in at about $43 billion, $1 billion above the Street’s consensus.
That wasn’t enough for investors, who had grown accustomed to blowout numbers from the AI chipmaker, and the stock sold off 8.5% Thursday.
But analysts at Bank of America remained optimistic and moved their stock price target from $190 to $200, representing 53% upside from Wednesday’s closing price and a 60% surge from Friday’s close.
“We reiterate our Buy rating on NVDA as the company remains in a dominant position of leading the AI market towards compute-intensive inference, agentic applications, and physical AI/robotics,” BofA said in a note dated Wednesday.
BofA pointed out that Nvidia posted overall strong results despite certain headwinds, such as DeepSeek’s release of a large language model that allegedly matched American competitors for a fraction of the costs.
Still, analysts acknowledged investors were disappointed, saying Nvidia’s first-quarter revenue guidance was “only” $1 billion more than consensus, whereas in previous quarters the margin reached $2 billion.
Other factors weighing on sentiment include “fatigue” surrounding overall AI investment amid restrictions on Chinese trade and concerns over return on investment, BofA added.
Another worry is narrower gross margins due to the costs of rolling out the new Blackwell chip. Last March, Nvidia unveiled Blackwell, its most advanced GPU. Production delays stalled the release of the chip until January.
But BofA said Nvidia saw $11 billion in Blackwell sales, exceeding the $4 billion-$7 billion market projections, with analysts expecting “very modest upward” trends in gross margins and a recovery by the second half of fiscal year 2026.
In fact, Nvidia CFO Colette Kress called Blackwell “the fastest product ramp in our company’s history.”
Given what Nvidia still has going for it, BofA remains bullish on the stock and its price.
“We understand the desire to diversify portfolios away from AI/cloud, but we believe this underappreciated the solid (and global) pace of AI investments and NVDA’s compelling valuation,” the note said.
According to BofA, other chip stocks in non-AI markets like Texas Instruments and Microchip Technologies trade at a higher value than Nvidia, “which does not seem reasonable to us.”
Meanwhile, Nvidia shares could see more action at the annual GTC trade show later this month, when business leaders across all industries are expected to explain how they’re using AI systems known as agents. During the last GTC conference, Nvidia announced Blackwell.
During the earning call Wednesday, CEO Jensen Huang said the company has “some really exciting things to share” at this year's conference. The company plans to announce two new chips: Blackwell Ultra and new AI platform Vera Rubin.
“We expect NVDA to re-energize as excitement builds for its flagship GTC trade show in mid-March,” BofA analysts said.
