Actions of Nvidia (Nvda -3.67%)) suffered a clear drop earlier this week. News that little costs Artificial Intelligence (AI) The Deepseek model, a Chinese AI start-up, could compete with the most advanced offers of companies like Openai sent a shock wave in the technological sector.
If you can build it for millions, why spend billions on Nvidia data center fleas? It was the fundamental concern that sent Nvidia Tumbling. But some Wall Street analysts think that the accomplishment of Deepseek will benefit the chip giant.
Citigroup ATIF analyst Malik maintained a note “buying” on the action with a price target of $ 175, which implies an increase of 40% on the current course of the current NVIDIA share of around $ 125. However, there are mixed opinions on the impact that Deepseek will finally have an impact on the activity of the Nvidia data center.
Is Deepseek good or bad for Nvidia?
If Deepseek can build an AI model at the cutting edge of low -cost technology, it could push large technological companies to adopt similar AI training techniques to do more with less slowdown in the recent impetus of Nvidia . Society data center The segment transported $ 30.8 billion in revenues during its third quarter of the 2025 financial year, more than double year to another.
However, a spokesperson for Nvidia told CNBC on Monday that Deepseek’s accomplishment was an “excellent AI progression”. And it is possible that instead of pushing technological companies to retreat to the expenditure of the data center, the effectiveness of the Deepseek model will only increase the overall demand for IA and Nvidia equipment to accelerate the more ‘Innovation in space.
Does the stock go to $ 175, and should you buy it now? There are currently a lot of unknowns, and some experts are skeptical about the assertion of Deepseek that he has formed his advanced model for less than $ 6 million. However, NVIDIA’s actions already negotiating a premium evaluation, he may find it difficult to achieve new short -term heights while investors sort what Deepseek means for the industry.
The safest course is to wait after NvidiaReport on the profits of February 26 when management updates investors at the request of trends. This will give an overview of the impact of these recent developments on the company.
Citigroup is an advertising partner of Motley Fool Money. John Ballard has positions in Nvidia. The Motley Fool has positions and recommends Nvidia. The Word’s madman has a Disclosure policy.