Nvidia’s (NASDAQ:NVDA) new year has kicked off in a muted fashion, with the shares’ uncharacteristically tilting into the red since 2025 came into view.
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But according to Bank of America analyst Vivek Arya, who ranks in the top 2% of Wall Street stock pros, investors needn’t worry too much here, as following investor meetings with some of the chip giant’s top brass, there appears to be plenty to stay positive about.
The 5-star analyst came out of the talks more confident in Nvidia’s standing as an AI incubator due to its “unique/highly leverageable silicon/system/software platform.” This is driving growth in areas like physical AI/robotics, on-premise AI workstations (Project Digits), AI PCs, and autonomous driving through partnerships with companies like Uber and Toyota – all capabilities unmatched by merchant or ASIC rivals.
Additionally, the company is still in the early stages of a $2 trillion “infrastructure opportunity,” having transformed only 20-25% of the first $1 trillion in traditional architecture to accelerated systems, with another $1 trillion opportunity to “support next-gen AI biz models.”
Meanwhile, general AI demand is still “very strong” across both Hopper and new Blackwell platforms. While Hopper remains a highly capable solution for many customers, most are expressing a preference for the supply-constrained Blackwell, now available through 15 partners and over 200 configurations. Once Blackwell fully ramps, Arya expects gross margins to return to the mid-70% range.
On the hot topic of GPU vs. ASIC, Nvidia acknowledged the recent rise in interest in custom ASICs but played down their potential for significant market share gains. The concept of custom ASICs is not new, having been around for nearly a decade, and developing one successfully typically takes 2-3 years. Nvidia pointed out that the rapidly evolving hardware and software requirements for AI make ASICs a “difficult solution,” aside from the lone success of Google’s TPU (Tensor processing unit). The company also emphasized that its products can be tailored specifically to a customer’s needs via its flexible platform.
Despite the overall bullish tone, Arya cautions investors to prepare for potential short-term turbulence.
“The stock could stay volatile until Q4 earnings (Feb-26) due to potential for enhanced China restrictions (low-mid single digit % sales impact, though offset by stronger demand elsewhere), and transition impact from Hopper to new Blackwell products. The next big catalyst will be the flagship GTC conference starting Mar 17th,” the analyst opined.
All in, Arya remains a big NVDA bull, calling the stock a “top sector pick,” and reiterating a Buy rating on the shares. The analyst’s $190 price objective factors in a one-year gain of 44%. (To watch Arya’s track record, click here)
Most analysts are thinking along the same lines. Based on a mix of 36 Buys vs. 3 Holds, the consensus view is that NVDA stock is a Strong Buy. Going by the $177.63 average price target, a year from now, shares will be changing hands for a ~35% premium. (See Nvidia stock forecast)
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Disclaimer: The opinions expressed in this article are solely those of the featured analyst. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.
