All The Reasons Bank Of America Just Bumped Its Nvidia Price Target To $210

Analysts at Bank of America turned incrementally bullish on NVIDIA Corporation NVDA amid multiple notable catalysts that will continue playing out. The firm's Vivek Arya maintains a Buy rating on Nvidia's stock with a price target boosted from $185 to $210.

Cloud Capex Surge

Nvidia's cloud capex is expected to materially accelerate from a 7-percent decline in the first half of 2017 to positive 31 percent in the bottom half of 2017, the analyst commented. Of particular note, Nvidia is looking to exert its influence and first mover advantage within the health care industry where its technologies will prove to be necessary for artificial intelligence and deep learning for predictive analytics, image scanning and pathology assessments.

In fact, the notable tech blog Wccftech highlighted Nvidia's new Volta V100-based DGX-1 has that boasts unrivaled and unprecedented performance versus its prior generation Pascal P100, Arya highlighted (see his track record here).

Gaming Momentum

The analyst's proprietary survey of Steam gaming and online graphics cards adds another element to the bullish case. For instance, the survey found that:

• 1. Nvidia's Pascal penetration gained momentum but still remains below the 45 percent adoption rate of the prior generation Maxwell.
  2. Nvidia holds a 95 percent-plus market share among top selling cards with average pricing higher by up to 14 percent month over month.

The rise of eSports and a new generation of video consoles at price points of $499 and above implies large upside to Nvidia's average selling price of its technology, the analyst added.

Low Investor Interest

Despite Nvidia's 73-percent gain in 2017 and nearly 200-percent gain over the past year, the stock isn't that widely held among fund managers, Arya added. For example, Nvidia's stock is held by just 22 percent of U.S. large-cap fund managers which is notably below the 28–35-percent range for its large-cap semi peers.

At time of publication, shares of Nvidia were up 3.88 percent at $187.09.

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