Why Is Nvidia Stock Trading Higher Friday?

Nvidia Corp NVDA stock is trading higher Friday as it continues to make headway into the Chinese market despite the U.S. embargo.

B of A Securities analyst Vivek Arya reiterated a Buy rating on Nvidia with a price target of $700. The stock is Arya's top pick.

The analyst views Nvidia as the biggest beneficiary of the growing AI accelerator market.

NVDA has a leading 75%-80% position in the rapidly growing accelerator space with next-generation GPUs.

Arya expects NVDA to maintain its leading 75%+ market share position, followed by a 10%-15% share combined across hyperscalers and OEMs investing in custom silicon projects and Advanced Micro Devices Inc AMD (5%-6%) with the remaining market share split across Intel Corp INTC and others.

If Nvidia can hold its 75%+ market share, then Arya expects it to generate >$40 in EPS by CY27E.

Arya upgraded AMD from Neutral to Buy and a $165 price target as he now sees potential for 5%-10% accelerator share capture in a growing market ($150 billion - $400 billion) by FY27E per various estimates).

The analyst views AMD as well-positioned to gain an incremental share of the hugely profitable $100 billion+ accelerator market while continuing to progress in server CPUs against incumbent INTC.

Intel intensified competition and announced its new artificial intelligence chips for PCs and data centers while dumping its plans to spin off its contract chip manufacturing division.

Arya upgraded Intel to Neutral from Underperform with a price target of $50 on possible restructuring action, driving a higher sum of parts valuation.

Price Action: NVDA shares traded higher by 1.43% at $490.39 on the last check Friday.