AI Bubble

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Yusuf M.
February 16, 2024
Written by Yusuf M.
Est read: 0 minutes

Earlier this week Nvidia’s market cap reached $1.83 Trillion briefly surpassing Amazon and Google further fueling the current AI bubble. Analysts have boosted their price targets with Mizuho raising its target price from $625 to $825. Goldman Sachs Toshiya Hari raised his price target from $175 to $800.

Another company whose stock is “booming” due to this “bubble” is ARM, a British chipmaker designer. Their designs are used by every major semi-conductor maker including Nvidia and Apple. ARM has seen its stock almost triple since IPO. Citi bank raised its price target from $86 to $115 and Barclays have set a target of $105. The rise in price has been driven by higher-than-expected revenue forecasts linked to AI development.

TSMC shares also closed at all-time highs this week as Morgan Stanley lifted its price target from 603 TWD to 750 TWD. As demand for chips increases a great deal of semi-conductor producers/designers and chipmakers alongside firms offering complementary products/services should see increased revenues likely to be reflected in their stock prices.