Bank of America analyst Vivek Arya suggests Nvidia Corp. shares are currently trading at a significant discount.
Bank of America analyst Vivek Arya reports that Nvidia Corp. shares could be trading at a discount of up to 50% because investors may be overstating risks associated with the artificial intelligence chip leader. A conceptual sum-of-parts analysis of the company's free cash flow shows the stock trades at a 34% to 50% discount, even after accounting for financing risks. While Nvidia Corp. shares fell 2.5% on Tuesday as part of a broader market decline, the company remains a strong performer with an 18% gain so far this year. The administration announced that Nvidia Corp. is investing heavily across the AI ecosystem, committing approximately $300 billion in capital to partners. This strategy aims to secure inputs like chip supply, land, and power while diversifying beyond public hyperscalers. Analysts from GF Securities also maintain a buy rating, with Jeff Pu raising the price target to $345. The company is scheduled to release its fiscal second-quarter results on August 26.