NVIDIA Corp (NASDAQ:NVDA) has the potential to see its stock price surge by 81% in the next year, according to a recent note by Evercore ISI.

What Happened: Evercore ISI initiated Nvidia with an “Outperform” rating and set a price target of $1,160, representing a 36% potential upside from the current levels, reported Business Insider.

In a bullish scenario, the firm suggested that the stock could potentially reach $1,540, an 81% increase from the current levels.

The note highlighted Nvidia’s position as a leader in the AI ecosystem, a role that is expected to drive efficiency gains for years to come.

Evercore ISI’s Mark Lipacis believes that Nvidia’s AI ecosystem play could capture 80% of the value created during its respective computing era, with the potential to dominate the parallel processing market by 2030, a market that could be worth more than $350 billion.

“We think investors underestimate 1) the importance of the chip+hardware+software ecosystem that Nvidia has created, 2) that computing eras last 15-20 years and are typically dominated by a single vertically integrated ecosystem company, whose returns are measured in 100-to-1000 bagger range,” Lipacis said.

“We believe that the Tectonic Shift to the current Parallel Processing / IoT Computing Era started 5-to-8 years ago, and that NVDA is the dominant ecosystem play in parallel processing, which is only in the beginning phases of generating outsized returns for its investors,” Lipacis said.  

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Why It Matters: Nvidia has been making strategic moves to solidify its position in the AI chip market. In response to U.S. sanctions, the company has revealed new products for China, aiming to launch two AI chips with diminished capabilities to comply with the sanctions. This move could potentially open up new avenues for growth in the Chinese market.

Analysts have also been bullish on Nvidia’s future prospects. Piper Sandler analyst Harsh V. Kumar reiterated an Overweight rating on Nvidia, citing strong demand for the company‘s Hopper chips and the upcoming Blackwell launch as key factors driving future growth.

Despite recent market dips, market commentator Jim Cramer has maintained his confidence in Nvidia, noting that the stock still holds significant growth potential.

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