Citigroup Raises Nvidia (NVDA) Target on Soaring AI Chip Demand

NVIDIA Corporation (NASDAQ:NVDA) is one of the must-buy semiconductor stocks to invest in. NVIDIA Corporation (NASDAQ:NVDA) has already cemented its status as the world’s most valuable company, riding the AI boom to new heights. Yet, the growth story is far from over, with demand for its chips accelerating and fresh AI applications just beginning to take shape.

Citigroup Raises Nvidia (NVDA) Target on Soaring AI Chip Demand

Citigroup analyst Atif Malik recently raised his outlook on the total addressable market (TAM) for data center AI chips to $563 billion by 2028, a 13% increase from his previous estimate. This upward revision is largely driven by stronger-than-expected demand from sovereign AI initiatives, which are contributing billions in sales today and are expected to expand further with upcoming AI factory buildouts.

Malik notes that Nvidia is deeply involved in nearly every sovereign AI deal, projecting tens of gigawatts of enterprise and sovereign AI factory installations over the next few years. While compute remains the primary growth driver, networking is also becoming increasingly important. Malik raised the networking TAM forecast by 32% to $119 billion, citing larger AI training clusters and more intensive inference workloads as key factors. Networking is expected to account for about 21% of the data center semiconductor TAM, up from 18%.

Reflecting these trends, Malik lifted his price target on Nvidia shares from $180 to $190. With a broad analyst consensus backing the stock, Nvidia remains a standout in the evolving AI semiconductor landscape.

While we acknowledge the risk and potential of NVDA as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than NVDA and that has 10,000% upside potential, check out our report about this cheapest AI stock.

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