Can Nvidia Stock Hit $200 in the Next Year?

Core Viewpoint - Nvidia's stock has experienced a significant decline of 26% since reaching a 52-week high at the beginning of 2025, with broader market sentiment indicating ongoing challenges for the company [1] Group 1: Challenges Facing Nvidia - The company is facing multiple challenges, including a potential slowdown in AI infrastructure spending, increased competition in the AI chip market, and rising manufacturing costs due to tariffs [2] - Citi has lowered Nvidia's price target from $163 to$150, citing a slight slowdown in U.S. data center spending [2][4] - Data center spending growth is expected to be 35% this year, down from an earlier estimate of 40%, with a further slowdown anticipated in 2026 [4][5] Group 2: Data Center Developments - Microsoft is slowing down data center construction, which is partly due to changes in its arrangement with OpenAI, allowing OpenAI to build its own data center infrastructure [5][6] - OpenAI plans to invest $100 billion in building AI data centers as part of the Stargate project, which could lead to increased demand for Nvidia's chips [6][7] - The first Stargate data center is expected to be completed by mid-next year in Texas, featuring 400,000 Nvidia AI GPU systems [7] Group 3: Financial Outlook - Nvidia's GPUs are priced between$30,000 to $35,000 each, with flagship server systems costing up to$3 million [8] - The Stargate project could lead to investments of up to $500 billion over the next four years, supporting Nvidia's data center business growth [9] - Major cloud computing companies like Alphabet and Amazon are maintaining substantial capital spending plans, which should benefit Nvidia [10] Group 4: Earnings Projections - Analysts forecast a 51$4.53 in fiscal 2026, with the stock currently trading at 25 times forward earnings, below its five-year average of 40 [12] - If Nvidia achieves the projected earnings and the market rewards it with a higher multiple, the stock price could reach $181, representing a 63$200 mark, making it an attractive investment opportunity [14]