Analysts are starting to be bullish on Nvidia again, after the semiconductor giant fell out of favor amid geopolitical tensions and a slowdown in the chip sector. Both Citi and JPMorgan said last week that strong demand for PC gaming, as well as cloud adoption in data centers, were going to be tailwinds for Nvidia. This is after the company unveiled new flagship gaming chips that use artificial intelligence to improve graphics. Nvidia’s data center business, which sells chips used in AI, has also boomed in recent years. “Whereas [first half] is generally seasonally weaker than 2H, we expect strong PC gaming demand to be a strong revenue driver for the company, offsetting PC [original equipment manufacturer], which is in secular decline,” JPMorgan said in a Sept. 21 note. The bank added that it also expects strong growth from Nvidia’s data center segment and noted strength in the automotive and JPMorgan said Nvidia’s new gaming products are expected to be strong demand drivers through 2023. high-performance computing, gaming and autonomous vehicles, in our view,” said JPMorgan. continues to be 1-2 steps ahead of competitors in silicon/systems, software and ecosystem adoption. .” Citi also has a buy rating on Nvidia, with a price target of $248, up about 98%. He said Nvidia was “working hard and fast” to provide customers with alternative products, given the restrictions in China. shares are down nearly 60% so far this year as it grapples with geopolitical headwinds. In August, the US government announced it was restricting chip sales to China, imposing a new licensing requirement for future exports to China to reduce the risk of the products being used by the Chinese military. “We work with our customers in China to satisfy their planned or future purchases with alternative products and may seek licensing when replacements are not sufficient,” an Nvidia spokesperson told CNBC at the time. The news prompted some downgrades for the stock in early September. However, during the same week, Cathie Wood of Ark Invest picked up 226,717 shares of Nvidia.
