Optimists looking for a Wall Street recall performance was very rewarded in 2024. Last year, the Industrial average Dow Jones,, S&P 500And Nasdaq Composite All have reached several records of record closing and finished respectively by 13%, 23%and 29%.
The fuel triggering this gathering has been abundant, with solid benefits from companies, an American economy resilient, a decrease in the rate of inflation in force and Donald Trump’s November victory All play a role. But at the heart of this gathering is the revolution and the evolution of Artificial Intelligence (AI).


Image source: Getty Images.
AI is the technology that changes the situation that gives software and systems the ability to reason, act and evolve, all without the need for human intervention. With the AI offering public service in most industries around the world, PWC plans that this technology increasing the Gross Domestic Product (GDP) by 26% in 2030.
Although AI was a boon for a large part of the technological sector, no company has only directly benefited from Nvidia (Nvda 0.77%)).
Each Wall Street analyst expects Nvidia’s stock to increase
In a Span of Less Than Two Years, We’ve Witnessed Nvidia Grow from a $ 360 Billion Business that was predominantly Known for Graphics Processing Units (GPUS) Used in PC Gaming and cryptocurrency mining to A $ 3.7 Trillion Company (At Its Peak) has become the brain of data centers accelerated by companies.
The demand for the company’s ultra-popular chip (H100) and the architecture of GPU Blackwell successor were from another world. While Advanced micro-apparents Evaluated its AI-ACCCELANT CHIPS MI300X instinct between $ 10,000 and $ 15,000, NVIDIA’S HOPPER ordered a price from $ 30,000 to $ 40,000. This combination of AI-GPU rarity and exceptional demand has increased the power of pricing and the raw margin of Nvidia.
In addition, no company is particularly approached to match the IT potential of the GPU of Nvidia. The above-mentioned blackwell GPU is designed to accelerate computer science in half a dozen arenas, including quantum calculation And generative AI solutions, and can do so while being considerably more energy efficient than its predecessor.
It is not only equipment, which helps Nvidia to hang its competitive advantages. Society CUDA software platformWho is the toolbox that the developers used to maximize the IT potential of their NVIDIA GPU, played a role in maintaining customers loyal to its product and service ecosystem.
And, of course, Nvidia’s operational results have always thrilled the consensual expectations of Wall Street analysts. After reporting $ 27 billion in annual sales during the year 2023 (completed on January 29, 2023), NVIDIA is expected to generate $ 129 billion in income for the year 2025. Cash flows and profits.
It may not be surprising that each Wall Street analyst expects Nvidia’s stock to go above. Of the 40 analysts that have issued price objectives, the The lowest ($ 135 per share) involves 5% Hence the actions closed on January 28. In addition, out of the 67 analysts who issued a recommendation for purchase, detention or sales (all analysts’ recommendations do not include a price objective), not Nvidia prices as the equivalent of a sub-performance or sales.
Although this may look like a resounding approval for Nvidia, this could be the ultimate annoying indicator.


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Wall Street could have nvidia all false
If history has proven something, it is because Wall Street analysts tend to be reactive rather than proactive with their notes. In other words, their rating adjusts After NVIDIA provides its quarterly operating results or its actions blow to a previous price objective. Being reactive instead of proactive can cause dozens of analysts to miss potentially serious red flags with Nvidia.
One of the greatest concerns that analysts seem to be unaware of collectively History is undefeated when it comes to putting innovations nearby in their place.
About three decades ago, the proliferation of the Internet allowed companies to market and reach their customers. Finally, the Internet has raised the growth trajectory of American and global companies. But it was not without the Dot-Com bubble which takes place and erase 78% of the value of the Nasdaq composite on a bread rush base.
Each innovation that has changed the situation for three decades has needed time to mature, without exception. However, investors (including Wall Street analysts) systematically overestimated the adoption rate and the utility at an early stage of each innovation and Big-Big trend.
Earlier this week, we had a Perfect example of this overestimation in practice. When Deepseek’s Great Language model (LLM) rocked the markets, investors were briefly worried about an increase in AI competition (which is a point to which I will speak in a moment). But the biggest concern is that it has revealed the reality of most companies that do not understand what is necessary to build and train LLM. In other words, most companies do not have a clear match plan with their investments in AI and have no definitive idea of the way to optimize AI solutions – and this is a problem when action Nvidia is evaluated for perfection.
Competition is also an inevitability that should weigh on the gross margin of Nvidia. Although the external competition of the AMD is a challenge, the A more disturbing threat could come from the greatest customers of Nvidia by net sales. Microsoft,, Meta-platforms,, AmazonAnd Alphabet are all internal development ia chips to use in their data centers. Even if these chips pale compared to the IT potential of Hopper and Blackwell from Nvidia, they will be much cheaper and more easily accessible than Nvidia equipment.
The end of the rarity of the A-GPU should erode the gross margin with Nvidia juice. NVDA gross beneficiary margin (quarterly) data by Ycharts.
A strong argument can be advanced according to which the AI-GPU rarity was more important for Nvidia than its superiority of computer speed. While this rarity decreases in the upcoming districts, the pricing power of Nvidia, and therefore its gross margin, could take a notable blow.
Wall Street analysts may also ignore geopolitical risks. China is one of Nvidia’s largest markets by net sales, and President Donald Trump’s trade policies have the potential to reduce trade relations Between the world’s largest economies by GDP. Be careful, the possibility that Trump implements prices on China and / or the manufacturers of foreign fleas appearing at the top of the Joe Biden administration who reprimanded himself on AI GPU exports since 2022.
Finally, Nvidia and the stock market, as a whole, are historically expensive. Nvidia exceeded a Price / sale ratio (P / s) Of 40 last summer, which is a level in accordance with bubble events for companies at the cutting edge of Next-Big innovations.
Although each analyst covering Nvidia expects her stock to go above, there is convincing evidence suggesting that they could all be false.
Suzanne Frey, director of Alphabet, is a member of the board of directors of Motley Fool’s. John Mackey, former CEO of Whole Foods Market, a subsidiary of Amazon, is a member of the board of directors of Motley Fool’s. Randi Zuckerberg, former Director of Development of the Facebook and Sister of the CEO of Meta Platforms, Mark Zuckerberg, is a member of the board of directors of Motley Fool’s. Sean Williams has positions in alphabet, Amazon and Meta platforms. The Motley Fool has positions and recommends micro advanced devices, alphabet, Amazon, Meta Platforms, Microsoft and Nvidia. The Motley Fool recommends the following options: Long January 2026 Calls $ 395 on Microsoft and Court January 2026 405 $ calls Microsoft. The Word’s madman has a Disclosure policy.