AI Creates 'Generational Opportunity': Why Nvidia Analyst Says Stock Will Hit $190

Nvidia Corp. NVDA continues to be Bank of America’s top stock pick within the artificial intelligence (AI) universe, with analyst Vivek Arya labeling the company as a “generational opportunity.”

On Thursday, the investment bank raised its price target for the company from $165 to $190. This implies a 40% upside compared to current market prices, on the heels of Nvidia's “dominant market position in AI chips” and future AI-driven growth.

Bank Of America Raises Earnings Estimates On Nvidia

Arya significantly boosted Nvidia’s earnings forecasts for 2025 and 2026 by 13% to 20%. He also highlighted the company’s “strong competitive lead” in the AI sector, controlling 80-85% of the market.

The analyst estimated that Nvidia could tap into a total addressable market (TAM) of over $400 billion by 2024. That’s four times larger than what was previously projected.

Several recent industry developments have also reinforced Bank of America's confidence in Nvidia’s long-term prospects.

Among these are strong earnings from key suppliers like Taiwan Semiconductor Company Ltd. TSM and Advanced Micro Devices Inc. AMD’s recent AI event, alongside meetings with tech giants like Broadcom Inc. AVGO, Micron Technology Inc. MU, and key players in optical technologies.

Recent reports from TSMC confirm that demand for AI technologies is robust and will likely remain so for years to come.

According to Nvidia management, demand for the company's next-generation Blackwell chips is “insane,” further supporting the bullish outlook.

The report also highlights Nvidia's “extraordinary cash generation potential.” Arya predicts the company could generate over $200 billion in “free cash flow” (FCF) over the next two years, with margins of 45-50%—almost double the average of the so-called “Magnificent 7” tech stocks, which includes giants like Apple Inc. AAPL and Microsoft Corp. MSFT.

Undervalued Partnerships And Revenue Growth

Arya also indicate that Nvidia's growing enterprise partnerships with companies such as Accenture plc ACN, ServiceNow Inc. NOW, and Oracle Corp. ORCL are “undervalued by the market.”

Beyond its hardware dominance, Nvidia’s software offerings, like its Networking Interface Modules (NIMs), are critical components in maintaining its leadership in AI infrastructure. These partnerships are expected to drive further expansion across multiple industries.

Despite NVIDIA's strong growth outlook and market dominance, Arya believes its “valuation remains attractive.” He calculates that NVIDIA's price-to-earnings growth (PEG) ratio for 2025 is just 0.6x, well below the average PEG ratio of 1.9x for the “Magnificent 7” stocks.

Market Reactions

Shares of Nvidia rose 0.84% on Friday to $138, just a hair’s breadth away from its record high of $140.89 set the previous day.

The iShares Semiconductor ETF SOXX slipped 0.1%, poised for a weekly decline of about 2.8%, following Wednesday’s selloff sparked by negative market reactions to ASML Holding N.V. ASML’s early earnings release.

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