By Nvidia Corp. gained fresh support from Wall Street on Wednesday after HSBC upgraded the semiconductor giant’s stock to buy from hold, citing sustained growth in artificial intelligence (AI) demand and an expanding total addressable market for graphics processing units (GPUs).
The brokerage also lifted its price target on Nvidia shares to a Street-high of $320, up from $200, implying an upside potential of roughly 78% from the stock’s last close of $180.03.
The new target would value Nvidia at nearly $8 trillion, compared with its current market capitalization of about $4.37 trillion, making it by far the world’s most valuable semiconductor company.
Shares of Nvidia rose 2.7% in premarket trading following the upgrade, extending their 34% year-to-date gain.
HSBC cites expanding AI chip market and China demand recovery
In a note to clients, HSBC analyst Frank Lee said the AI GPU total addressable market (TAM) is expected to expand beyond traditional hyperscale cloud providers, supporting “continuous earnings growth” over the next several years.
Lee projected “room for significant FY27e earnings upside” as Nvidia continues to dominate AI chip sales amid broad-based adoption of generative AI technologies.
The brokerage also expressed optimism that trade conditions between the US and China could improve, potentially easing restrictions on advanced chip exports.
“We see potential easing of China GPU uncertainties following the potential US-China trade deal that could enable Nvidia to see a demand recovery in the Chinese market,” Lee wrote.
Nvidia has been at the center of the AI hardware boom, supplying GPUs that power models developed by firms such as OpenAI, Anthropic, and xAI.
The analyst noted that the AI GPU market is growing rapidly “beyond hyperscalers,” indicating strong demand from enterprise, research, and edge-computing sectors.
Analyst consensus remains overwhelmingly bullish
HSBC’s upgrade adds to the already dominant bullish sentiment surrounding Nvidia.
According to data compiled by Bloomberg, more than 90% of analysts covering the stock rate it as a buy, while fewer than 8% hold neutral ratings and only one analyst recommends selling.
The average price target among 66 analysts tracked by LSEG stands at $214.50, implying a return potential of over 20% based on the previous close.
The latest bullish call follows Nvidia’s participation in a major infrastructure deal.
The company is part of an investment consortium — alongside BlackRock, Microsoft, and xAI — that agreed to acquire Aligned Data Centers in a $40 billion transaction, underscoring its growing influence beyond chip design into the broader AI infrastructure ecosystem.
Broader chip sector gains as AI spending accelerates
Nvidia’s gains coincided with strength across the semiconductor sector after ASML Holding NV reported third-quarter orders and operating income above market expectations.
Other US chipmakers, including Advanced Micro Devices Inc. (AMD), also traded higher.
HSBC reaffirmed its buy rating on AMD and lifted its price target to $310 from $185, another Street high.
Lee said AMD’s recent partnership with OpenAI “paints a more favorable picture” for the company and “improves visibility,” adding that pricing premiums and higher AI GPU volumes could drive further upside.
AMD shares rose 2.6% in premarket trading, extending their 35% October rally and pushing year-to-date gains to over 80%.
With AI investment accelerating globally and demand for high-performance chips showing little sign of slowing, HSBC’s bullish stance underscores the belief that Nvidia and its peers remain at the heart of one of the most powerful growth cycles in the technology sector.
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